Low cost airline competition fuels big price cuts, survey finds
After years of mergers and acquisitions, 70% of US domestic air travel is operated by the four major carriers, but low-cost airlines still have an influence on air fare pricing, according to a study.
Travel planning website Hopper analyzed fare data on 96 domestic routes when a low cost airline entered the market.
The study showed that when budget carriers such as JetBlue, Spirit, Frontier, Alaska or Southwest launch services on a domestic route, fares can drop as much as 67%.
Hopper said JetBlue had the biggest impact on falling air fares when entering a new market, driving down prices by over 50% on average and as much as 67% on some routes.
A highlighted example was the JetBlue service between Boston and Philadelphia which began in May 2013, and saw prices fall from $356 to $118.
Spirit and Frontier Airlines saw an average 30% drop in airfares when they enter a new market, the study found.
Fares do gradually rise again over time, but rarely to same level as before.
The Hopper analysis spanned six months of air fare data – covering three months before and three months after a low cost carrier started flying a new route.
TravelMole Editorial Team
Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
Vegas’s Billion-Dollar Secrets – What They Don’t Want Tourists to Know
Visit Florida’s New CEO Bryan Griffin Shares His Vision for State Tourism with Graham
Chicago’s Tourism Renaissance: Graham Interviews Kristin Reynolds of Choose Chicago
Graham Talks with Cassandra McCauley of MMGY NextFactor About the Latest Industry Research
Destination International’s Andreas Weissenborn: Research, Advocacy, and Destination Impact
Graham and Don Welsh Discuss the Success of Destinations International’s Annual Conference
Graham and CEO Andre Kiwitz on Ventura Travel’s UK Move and Recruitment for the Role
Brett Laiken and Graham Discuss Florida’s Tourism Momentum and Global Appeal
Graham and Elliot Ferguson on Positioning DC as a Cultural and Inclusive Global Destination
Graham Talks to Fraser Last About His England-to-Ireland Trek for Mental Health Awareness
Kathy Nelson Tells Graham About the Honour of Hosting the World Cup and Kansas City’s Future
Graham McKenzie on Sir Richie Richardson’s Dual Passion for Golf and His Homeland, Antigua
ADS PRO 
Phocuswright reveals the world's largest travel markets in volume in 2025
Higher departure tax and visa cost, e-arrival card: Japan unleashes the fiscal weapon against tourists
Cyclone in Sri Lanka had limited effect on tourism in contrary to media reports
Singapore to forbid entry to undesirable travelers with new no-boarding directive
Euromonitor International unveils world’s top 100 city destinations for 2025