Record drop in US fares shows how far airlines have to climb

Domestic US airfares fell by the most on record in Q2 -- another illustration of how the coronavirus pandemic gutted demand for flights. Average one-way ticket prices plummeted 26% from the same period last year to $151, including taxes and fees, according to 20 years of airfare figures compiled by Cirium. Previously, the largest decline was 14% in late 2001, following the Sept. 11 terrorist attacks, the aviation-data provider said Tuesday. US travel demand all but vanished this March, plunging airlines into their worst-ever crisis less than two months after the first US coronavirus case was identified. As many Americans sheltered at home, carriers slashed their schedules, parked aircraft, ramped up borrowing and received $25b in federal payroll support, plus billions more in government loans. The lowest fare in Cirium’s data was $149 in Q4 2004 in nominal terms. But that would be about $203 in today’s dollars. Cirium’s report is based on data collected by the US DoT. The government agency delayed its report on Q2 fares, which had been planned for Tuesday, to review the information, a spokesman said. The bargains aren’t gone: The three largest US airlines continue to offer low fares -- $96.20 round-trip -- for flights from New York to Chicago on some off-peak days next month. In addition to the massive drop in customers, airlines are also suffering the loss of business travelers, who tend to purchase tickets closer to their travel date and pay more than people flying for leisure. “It’s a mix thing -- the mix of customers flying are now the cheap ones,” said Jim Ogden, a Cirium director and former American Airlines network planner.<br/>