Why does flying abroad cost so much?
April 12, 2011 11:25 AM Subscribe
Why are international flights so much more expensive than domestic flights?
I need to go to Europe in May, and to California in June. The cheapest return flight return flight to Amsterdam I could find is around $1400, and a return flight to LAX is around $550. So, that's 38 cents per mile versus 22 cents per mile. What could possibly explain this huge price difference? Taxes? The actual planes used?
I need to go to Europe in May, and to California in June. The cheapest return flight return flight to Amsterdam I could find is around $1400, and a return flight to LAX is around $550. So, that's 38 cents per mile versus 22 cents per mile. What could possibly explain this huge price difference? Taxes? The actual planes used?
Response by poster: Ah, should have added, I'm in the New York metro area.
posted by monospace at 11:29 AM on April 12, 2011
posted by monospace at 11:29 AM on April 12, 2011
Demand has something to do with it. Summer is a really bad time to go to Europe: it's high season. I've had flights from DC to Berlin for as cheap as $220 + taxes (no jokes, but this was in 2004).
posted by kdar at 11:30 AM on April 12, 2011 [1 favorite]
posted by kdar at 11:30 AM on April 12, 2011 [1 favorite]
Some international flights can be very cheap (for example, see Ryanair). I think your question is really, how come flights out of and into the USA are so expensive?
And yeah, stay away from Europe in the summertime (unless you like arriving at places only to find long lines of young people in front of you).
posted by Rash at 11:32 AM on April 12, 2011
And yeah, stay away from Europe in the summertime (unless you like arriving at places only to find long lines of young people in front of you).
posted by Rash at 11:32 AM on April 12, 2011
JPD has it. There's a lot more airlines flying the route you want into LA than into Amsterdam. You could try flying to London Heathrow and then take a commuter flight to Amsterdam. There's many more airline flying into LHR so prices might be better.
posted by Long Way To Go at 11:32 AM on April 12, 2011
posted by Long Way To Go at 11:32 AM on April 12, 2011
Taxes are another reason, according to United's fare rules:
Travel within the 50 United States
Fare includes 7.5% U.S. excise tax. For travel to or from Hawaii and Alaska, fare also includes U.S. government excise tax of 8.10 USD per direction for tickets purchased before January 1, 2011, or 8.20 USD per direction for tickets purchased on or after January 1, 2011.
Fare does not include the following taxes, fees and surcharges:
- Airport passenger facility charges (PFCs) of up to 18.00 USD roundtrip
- U.S. Federal Segment Tax of 3.70 USD on each flight segment †
- September 11th Security Fee of 2.50 USD per enplanement at a U.S. airport
International travel (including Puerto Rico and the U.S. Virgin Islands)
Fare includes U.S. excise tax, and carrier-imposed fuel surcharges (YQ) of up to 300.00 USD per direction of travel may apply. For travel to some countries, additional airport, transportation, embarkation, security and passenger service taxes/surcharges may also apply depending on destination. Fare does not include the following taxes, fees and surcharges:
- Airport passenger facility charges (PFCs) of up to 19.50 USD roundtrip
- September 11th Security Fee of 2.50 USD per enplanement at a U.S. airport
- Other government taxes and fees (including U.S. government excise tax) of up to 140.00 USD based on destination; total may vary slightly based upon currency exchange rate at time of purchase
- Taxes and fees are subject to change without notice and at the discretion of each country’s government
posted by brainmouse at 11:33 AM on April 12, 2011
Travel within the 50 United States
Fare includes 7.5% U.S. excise tax. For travel to or from Hawaii and Alaska, fare also includes U.S. government excise tax of 8.10 USD per direction for tickets purchased before January 1, 2011, or 8.20 USD per direction for tickets purchased on or after January 1, 2011.
Fare does not include the following taxes, fees and surcharges:
- Airport passenger facility charges (PFCs) of up to 18.00 USD roundtrip
- U.S. Federal Segment Tax of 3.70 USD on each flight segment †
- September 11th Security Fee of 2.50 USD per enplanement at a U.S. airport
International travel (including Puerto Rico and the U.S. Virgin Islands)
Fare includes U.S. excise tax, and carrier-imposed fuel surcharges (YQ) of up to 300.00 USD per direction of travel may apply. For travel to some countries, additional airport, transportation, embarkation, security and passenger service taxes/surcharges may also apply depending on destination. Fare does not include the following taxes, fees and surcharges:
- Airport passenger facility charges (PFCs) of up to 19.50 USD roundtrip
- September 11th Security Fee of 2.50 USD per enplanement at a U.S. airport
- Other government taxes and fees (including U.S. government excise tax) of up to 140.00 USD based on destination; total may vary slightly based upon currency exchange rate at time of purchase
- Taxes and fees are subject to change without notice and at the discretion of each country’s government
posted by brainmouse at 11:33 AM on April 12, 2011
Yeah, taxes are definitely a part of it. They easily double the cost of a flight when I have to travel to Europe for work.
posted by backseatpilot at 11:41 AM on April 12, 2011
posted by backseatpilot at 11:41 AM on April 12, 2011
The above all sound like good explanations to me (limited number of flights, European taxes and fees, etc.), but you should also consider the cost of jet fuel. New York to LA is about 2,450 miles, while New York to Amsterdam is about 3,650 miles—i.e., it's about 150% of the former distance.
posted by evidenceofabsence at 11:45 AM on April 12, 2011
posted by evidenceofabsence at 11:45 AM on April 12, 2011
brainmouse - add up the fees, sure there is some difference - but max at 140/bucks- but that fuel surcharge for existance only exists because of the lack of competition on a route. Pretty much every destination in Europe has only 3-4 carriers from the US. Many are just 2-3, and often those 2-3 might be in the same alliance so they play nice with one another.
posted by JPD at 11:46 AM on April 12, 2011
posted by JPD at 11:46 AM on April 12, 2011
USA-Europe flights in my experience use larger/better planes. The seats I've had going to Europe in coach are the equivalent of business class in domestic. So they're probably using a larger, less fuel-efficient plane, while carrying less passengers per square whatever.
posted by drjimmy11 at 11:49 AM on April 12, 2011
posted by drjimmy11 at 11:49 AM on April 12, 2011
JPD -- $140... plus the $300 from the first sentence, plus possible "additional airport, transportation, embarkation, security and passenger service taxes/surcharges" -- So $440 + (unknown amount) in possible fees above and beyond the US ones.
posted by brainmouse at 11:49 AM on April 12, 2011
posted by brainmouse at 11:49 AM on April 12, 2011
Also, I'd imagine the price of fuel matters -- this is an undated table of car fuel prices... but I assume that plane fuel is subject to the same discrepancies -- A gallon of gas cost $6.48 in the Netherlands (US dollars)-- so it costs them a lot more to re-fuel to come back to the US there than it does to refuel to go back to NY from LA.
posted by brainmouse at 11:54 AM on April 12, 2011
posted by brainmouse at 11:54 AM on April 12, 2011
Along with what everyone else has said, I've gotten more and much better food when crossing the Atlantic than I ever have flying across the... flyover states. I know food is a small % of the total cost, but it's something.
posted by desjardins at 12:04 PM on April 12, 2011
posted by desjardins at 12:04 PM on April 12, 2011
In addition to what has been posted so far I would guess that total fuel requirement is not a linear function of distance. The further you fly the more fuel you need. More fuel means more weight. More weight means less mpg means more fuel consumption. So total fuel consumption should increase more than linearly with distance.
(This is assuming that airlines try to optimize tank fill levels depending on flight distance rather than always filling tanks all the way by default.)
posted by Hairy Lobster at 12:07 PM on April 12, 2011 [1 favorite]
(This is assuming that airlines try to optimize tank fill levels depending on flight distance rather than always filling tanks all the way by default.)
posted by Hairy Lobster at 12:07 PM on April 12, 2011 [1 favorite]
I see flights to Europe (from Calgary, Canada) for $199 return all the time. EXCEPT they always add approximately $480 worth of taxes. Even if the flight was free, the taxes would make it expensive.
posted by blue_beetle at 12:17 PM on April 12, 2011
posted by blue_beetle at 12:17 PM on April 12, 2011
(This is assuming that airlines try to optimize tank fill levels depending on flight distance rather than always filling tanks all the way by default.)
You're right, they definitely don't fill tanks all the way by default, they plan how much they need, add in a safety margin, then the pilot comes along and adds in another safety margin for luck (at least, that's how it was when a good friend of mine was a flight planner for an international airline).
posted by Infinite Jest at 12:29 PM on April 12, 2011
You're right, they definitely don't fill tanks all the way by default, they plan how much they need, add in a safety margin, then the pilot comes along and adds in another safety margin for luck (at least, that's how it was when a good friend of mine was a flight planner for an international airline).
posted by Infinite Jest at 12:29 PM on April 12, 2011
brainmouse- no the 300 is mostly fuel surcharges - you can only charge the fuel surcharges because of the lack of competition - its stealth pricing.
posted by JPD at 12:30 PM on April 12, 2011
posted by JPD at 12:30 PM on April 12, 2011
Here is a good explanation of how much fuel does each airliner have to carry.
posted by mmascolino at 12:36 PM on April 12, 2011 [1 favorite]
posted by mmascolino at 12:36 PM on April 12, 2011 [1 favorite]
I believe that the US has among the lowest landing fees at airports. I've seen in the Canadian media how airports in the States get more gov't support as economic hubs than in Canada. I know Toronto has significantly higher fees than American airports.
posted by dripdripdrop at 12:49 PM on April 12, 2011
posted by dripdripdrop at 12:49 PM on April 12, 2011
It's also just supply and demand. If flying is too expensive for trips within a 1-2 day drive, some travelers (especially leisure travelers) will just drive instead or will forgo the trip entirely. Many international travelers are flying because they have to, generally for business or sometimes because they have family overseas, while domestic trips have more passengers shopping around for low fares. International travelers tend to have larger budgets than domestic ones and are less price conscious, so the airlines charge them more because they can.
Plus, in your case, the time before the flight is also a factor. May is coming up soon. People don't generally plan European vacations on less than a month's notice, and the people who do this tend to be able to afford high airfares. As a result, most people trying to buy a ticket right now to go to Europe in May are business travelers or at least have a more urgent need to go. June isn't for another month after that and people don't plan domestic trips as far in advance, so there's more price elasticity in a June flight to LAX and the airline can't charge as high a price.
posted by zachlipton at 12:55 PM on April 12, 2011 [1 favorite]
Plus, in your case, the time before the flight is also a factor. May is coming up soon. People don't generally plan European vacations on less than a month's notice, and the people who do this tend to be able to afford high airfares. As a result, most people trying to buy a ticket right now to go to Europe in May are business travelers or at least have a more urgent need to go. June isn't for another month after that and people don't plan domestic trips as far in advance, so there's more price elasticity in a June flight to LAX and the airline can't charge as high a price.
posted by zachlipton at 12:55 PM on April 12, 2011 [1 favorite]
Response by poster: Okay, now riddle me this. Just for the hell of it, I did an Orbitz search for the inverse trip: Round trip from Amsterdam TO New York. Average price: $800. What??
posted by monospace at 1:05 PM on April 12, 2011
posted by monospace at 1:05 PM on April 12, 2011
Okay, now riddle me this. Just for the hell of it, I did an Orbitz search for the inverse trip: Round trip from Amsterdam TO New York. Average price: $800. What??
I'm not sure the exact dates you are flying, but I found EWR -> AMS round trip for $840 on USScare, $850 on Aer Lingus, dates May 11 - May 26. If you want to MeMail me with dates, I've got some excellent airfare-fu.
posted by Mister Fabulous at 1:32 PM on April 12, 2011
I'm not sure the exact dates you are flying, but I found EWR -> AMS round trip for $840 on USScare, $850 on Aer Lingus, dates May 11 - May 26. If you want to MeMail me with dates, I've got some excellent airfare-fu.
posted by Mister Fabulous at 1:32 PM on April 12, 2011
Okay, now riddle me this. Just for the hell of it, I did an Orbitz search for the inverse trip: Round trip from Amsterdam TO New York. Average price: $800. What??
Again, the thing to remember here is that the price airlines charge at any given time has virtually nothing to do with the cost of providing the service. If the plane has empty seats, the marginal cost of letting you fly is pretty close to $0 (just food, baggage handling, IT, etc...); that's why they let airline staff and their families fly for free on a space-available basis. The trick with pricing air tickets is not to determine a "fair" price for the flight in question, but rather to figure out how much people are willing to pay at this given moment and to charge them that. Will you or another passenger cancel your trip if the ticket cost $1500 but you're begrudgingly willing to pay $1400? If so, they've found a good price.
So why is the inverse trip so much cheaper? Presumably it's because people aren't willing to pay as much for it. The simplest reason could well be that more New Yorkers want to fly to Amsterdam than the other way around. There could be some big conventions in Amsterdam; it's peak European travel season; New York-based businessmen have bigger travel budgets than Amsterdam-based businessmen; Amsterdam residents have a lot more travel options within Europe than Americans do in our region; or any number of other reasons. It might be that European travelers are more willing to take Ryanair or another low-cost European carrier to London and connect to a flight from there, while American travelers prefer a direct flight. It doesn't really matter why this is the case: as long as people are willing to pay more, the airline will charge more.
The other thing that comes into play here is the effect of connecting flights. That flight from JFK-AMS might be one segment of a SFO-JFK-AMS routing, or we can even add a commuter flight in there and get a FAT-SFO-JFK-AMS routing (you probably can do better than that, but that's not the issue). All things being equal, the airline would rather sell the seat to the SFO-JFK-AMS passenger than the JFK-AMS passenger, because longer itineraries are usually more profitable and they can fill more seats in a single booking. There's no reason for them to sell you the JFK-AMS leg for $800 if you're going to take up the seat that the SFO-JFK-AMS passenger would pay $1400 or more for, so they price it higher in the hope they can sell it to someone who wants a longer trip.
So why doesn't this work in reverse too? It can, but it's not always a symmetric operation. Most travelers would prefer to clear customs at their final destination in the US rather than fret over whether they can clear customs in JFK and catch another flight to their destination. It might be that more Amsterdam-based travelers are making New York their final destination, while US travelers are more likely to use JFK as a stopping point en-route to AMS. Again, it doesn't really matter why this is true, as the airline will gladly recognize the disparity and incorporate it into their pricing model.
posted by zachlipton at 1:35 PM on April 12, 2011 [5 favorites]
Again, the thing to remember here is that the price airlines charge at any given time has virtually nothing to do with the cost of providing the service. If the plane has empty seats, the marginal cost of letting you fly is pretty close to $0 (just food, baggage handling, IT, etc...); that's why they let airline staff and their families fly for free on a space-available basis. The trick with pricing air tickets is not to determine a "fair" price for the flight in question, but rather to figure out how much people are willing to pay at this given moment and to charge them that. Will you or another passenger cancel your trip if the ticket cost $1500 but you're begrudgingly willing to pay $1400? If so, they've found a good price.
So why is the inverse trip so much cheaper? Presumably it's because people aren't willing to pay as much for it. The simplest reason could well be that more New Yorkers want to fly to Amsterdam than the other way around. There could be some big conventions in Amsterdam; it's peak European travel season; New York-based businessmen have bigger travel budgets than Amsterdam-based businessmen; Amsterdam residents have a lot more travel options within Europe than Americans do in our region; or any number of other reasons. It might be that European travelers are more willing to take Ryanair or another low-cost European carrier to London and connect to a flight from there, while American travelers prefer a direct flight. It doesn't really matter why this is the case: as long as people are willing to pay more, the airline will charge more.
The other thing that comes into play here is the effect of connecting flights. That flight from JFK-AMS might be one segment of a SFO-JFK-AMS routing, or we can even add a commuter flight in there and get a FAT-SFO-JFK-AMS routing (you probably can do better than that, but that's not the issue). All things being equal, the airline would rather sell the seat to the SFO-JFK-AMS passenger than the JFK-AMS passenger, because longer itineraries are usually more profitable and they can fill more seats in a single booking. There's no reason for them to sell you the JFK-AMS leg for $800 if you're going to take up the seat that the SFO-JFK-AMS passenger would pay $1400 or more for, so they price it higher in the hope they can sell it to someone who wants a longer trip.
So why doesn't this work in reverse too? It can, but it's not always a symmetric operation. Most travelers would prefer to clear customs at their final destination in the US rather than fret over whether they can clear customs in JFK and catch another flight to their destination. It might be that more Amsterdam-based travelers are making New York their final destination, while US travelers are more likely to use JFK as a stopping point en-route to AMS. Again, it doesn't really matter why this is true, as the airline will gladly recognize the disparity and incorporate it into their pricing model.
posted by zachlipton at 1:35 PM on April 12, 2011 [5 favorites]
zachlipton has given you a pretty good idea of the complexities of airline pricing. There's no straightforward relationship between the cost to operate a flight and and the price charged to any given person on any given date.
Apart from the factors already mentioned, there may be things like all the cheaper seats on the May flight have already been booked up due to people taking Easter vacations, or there may happen to be some big conference or event on in Amsterdam the week you wanted to travel etc.
posted by philipy at 3:09 PM on April 12, 2011
Apart from the factors already mentioned, there may be things like all the cheaper seats on the May flight have already been booked up due to people taking Easter vacations, or there may happen to be some big conference or event on in Amsterdam the week you wanted to travel etc.
posted by philipy at 3:09 PM on April 12, 2011
When I've looked for flights from the US to London recently, the cheapest flight I could find cost between $300 and $600 or so, but always with an additional two to four hundred dollars of fees tacked on. That's what makes the flight expensive, in my experience, compared to domestic travel, where the fees are usually like forty bucks.
posted by MadamM at 3:34 PM on April 12, 2011
posted by MadamM at 3:34 PM on April 12, 2011
Some countries in particular have very high government fees. Any flight into Heathrow will have $150 in taxes.
Also, keep in mind that you can fly extremely far for your money on some international flights. I recently flew JFK to Melbourne Australia on a $1500 ticket via Dubai. All told it was about 56 hours of flights and 28,000 miles (more than once around the world), but only 10 cents per mile.
posted by smackfu at 4:00 PM on April 12, 2011
Also, keep in mind that you can fly extremely far for your money on some international flights. I recently flew JFK to Melbourne Australia on a $1500 ticket via Dubai. All told it was about 56 hours of flights and 28,000 miles (more than once around the world), but only 10 cents per mile.
posted by smackfu at 4:00 PM on April 12, 2011
International air travel cost is outrageous most of the time. Deals are not easy, and need to be booked really many months in advance.
Here's a spring sale by Lufthansa.
It looks like NYC-AMS is not part of this sale. (Boston) BOS-AMS for random dates in May yielded ~$1100.
You know what frustrates me? -- just look at the ridiculous way they advertise this sale:
(emphasis mine)
posted by thewildgreen at 4:37 PM on April 12, 2011
Here's a spring sale by Lufthansa.
It looks like NYC-AMS is not part of this sale. (Boston) BOS-AMS for random dates in May yielded ~$1100.
You know what frustrates me? -- just look at the ridiculous way they advertise this sale:
(emphasis mine)
Enjoy the holidays in Europe and beyond and give yourself a treat after a long winter. Take advantage of our current low spring fares starting at $252* and visit the great sites across the Atlantic. Purchase your tickets by Apr. 13, 2011.A $252 number turns into 4x that before you can buy it! I really hope we get some regulation for how these fares are advertised by airlines.
Tax and Fee information:
*Fares are one-way based on round-trip purchase. Fares do not include applicable taxes, fees and airport charges up to $260, including the September 11th Security Fee of a maximum of $10 per round-trip. Weekend surcharges and additional baggage fees may apply.
posted by thewildgreen at 4:37 PM on April 12, 2011
Another factor is that planes that have the range necessary to fly overseas are more expensive than a plane that only needs to fly domestically. For example, a domestic airline that I am familiar with doesn't currently own any planes that are capable of flying to Hawaii.
posted by bendy at 5:56 PM on April 12, 2011
posted by bendy at 5:56 PM on April 12, 2011
1. Supply/Demand
2. Fuel prices (long hauls have to carry more fuel, which is a dead load.)
3. Taxes (Heathrow is famous for extreme landing taxes)
Overall, I think what you'll find in the comparison of international versus domestic plane flights is also a higher variability in prices due to a completely different customer base.
Long-hauls are catering to people who often make plans further in advance, thus the initial prices may be very low to ensure some revenue from the flight and then the prices increase continually as the flight fills up.
Short-hauls are a bit like sky-buses, there's a relatively narrow price range as there are many more unplanned trips.
posted by nickrussell at 1:36 AM on April 13, 2011
2. Fuel prices (long hauls have to carry more fuel, which is a dead load.)
3. Taxes (Heathrow is famous for extreme landing taxes)
Overall, I think what you'll find in the comparison of international versus domestic plane flights is also a higher variability in prices due to a completely different customer base.
Long-hauls are catering to people who often make plans further in advance, thus the initial prices may be very low to ensure some revenue from the flight and then the prices increase continually as the flight fills up.
Short-hauls are a bit like sky-buses, there's a relatively narrow price range as there are many more unplanned trips.
posted by nickrussell at 1:36 AM on April 13, 2011
Don't forget that international flights also cost more in terms of staffing. They have to have a larger crew to fit the work rules.
adding onto zachlipton's excellent comment, time of day makes a difference. (Although possibly not as much internationally..?) You are going to pay more for desirable flight times than not. I would suspect the "leave in the evening, arrive in the morning" types of flights are going to be more valuable than the opposite.
Also, don't discount fuel costs. A 747-400er holds 67,000 gallons of fuel with a max range of 7670 nm. That's 0.11 miles per gallon. It has a 416, 524 or 624 seating capacity (3, 2 or 1 class). Shooting for the middle, that's 59 passenger miles per gallon. Or, each passenger uses 127 gallons of fuel, which is about $3 a gallon. So for a flight like that, you are talking $380, just for fuel.
And the planes themselves cost $250 million, which is in the range of $3000 PER FLIGHT HOUR of depreciation. Or, about $100 per passenger per trip.
This is assuming it flies at max range every time, which is a big assumption, but serves as illustrative. For a long range flight, you are at almost $500 just for your share of gas and rent.
posted by gjc at 7:22 AM on April 13, 2011 [2 favorites]
adding onto zachlipton's excellent comment, time of day makes a difference. (Although possibly not as much internationally..?) You are going to pay more for desirable flight times than not. I would suspect the "leave in the evening, arrive in the morning" types of flights are going to be more valuable than the opposite.
Also, don't discount fuel costs. A 747-400er holds 67,000 gallons of fuel with a max range of 7670 nm. That's 0.11 miles per gallon. It has a 416, 524 or 624 seating capacity (3, 2 or 1 class). Shooting for the middle, that's 59 passenger miles per gallon. Or, each passenger uses 127 gallons of fuel, which is about $3 a gallon. So for a flight like that, you are talking $380, just for fuel.
And the planes themselves cost $250 million, which is in the range of $3000 PER FLIGHT HOUR of depreciation. Or, about $100 per passenger per trip.
This is assuming it flies at max range every time, which is a big assumption, but serves as illustrative. For a long range flight, you are at almost $500 just for your share of gas and rent.
posted by gjc at 7:22 AM on April 13, 2011 [2 favorites]
One thing to remember when annoyed by air fares.... the airline industry is one of the least profitable of all business sectors. By some measures looking at the whole industry over the whole of its lifetime, it's overall lost money. In some ways it's a wonder that anyone bothers to run airlines at all.
But basically in no business is there any necessary connection between costs of producing a product and what it gets priced at. Esp when you only look at the raw material costs.
An iPad sells for a lot more than the value of its component parts. Likewise how much people are willing to pay to read a newspaper has got nothing to with what it costs to produce that newspaper, which is why a lot of newspapers are in trouble and trying to figure out how to survive.
When you get a cheap flight the airline might not be covering its (fully allocated) costs, but just getting the best it can on that seat. And it stays in business only because some other guy, maybe a business traveller, paid a heck of lot more to fly than it cost to fly him.
posted by philipy at 12:11 PM on April 13, 2011
But basically in no business is there any necessary connection between costs of producing a product and what it gets priced at. Esp when you only look at the raw material costs.
An iPad sells for a lot more than the value of its component parts. Likewise how much people are willing to pay to read a newspaper has got nothing to with what it costs to produce that newspaper, which is why a lot of newspapers are in trouble and trying to figure out how to survive.
When you get a cheap flight the airline might not be covering its (fully allocated) costs, but just getting the best it can on that seat. And it stays in business only because some other guy, maybe a business traveller, paid a heck of lot more to fly than it cost to fly him.
posted by philipy at 12:11 PM on April 13, 2011
This thread is closed to new comments.
posted by raccoon409 at 11:27 AM on April 12, 2011