The truth about airline ticket prices.


I can explain the truth about airline ticket prices in just two words:

Jerry Jones.

Stay with me, please. And go one step further, considering also “The Death Star,” as local sports commentators have dubbed Jerry Jones’ new billion-dollar stadium in Arlington.

"Jerry World," Arlington, Texas.

Put these two images together and consider one very important economic indicator: the FCI, or “Fan Cost Index.”  The FCI formula takes a representative look at what a family of four could expect to spend at a football game this year. The FCI comprises the prices of four average-price “general” tickets, two small draft beers, four small soft drinks, four regular-size hot dogs, parking for one car, two game programs and two least-expensive, adult-size adjustable caps.

According to a  recent survey, Jerry Jones and his new stadium have had a major impact on NFL ticket prices. According to a late-2009 “Team Marketing Report:”

“Tickets to National Football League games climbed a bit for the 2009 season, thanks to a pricey new stadium in Arlington, Texas. The average ticket to a NFL game rose 3.9 percent to $74.99, according to Team Marketing Report’s exclusive survey, but with 21 teams either keeping prices the same or lowering them, the main push behind the percentage increase came from Cowboys Stadium, Jerry Jones’ $1.2 billion football palace. [italics mine]

"YTBSM."

The average ticket to a Cowboys game costs $159.65, a new record for the Fan Cost Index survey, which has been around since 1991.
The Cowboys knocked the New England Patriots off their perch as the priciest ticket in pro sports. The Patriots kept their price the same
at $117.84.”

So, if the average family would like to take in a Dallas Cowboys football game, the price tag would be $758.00 per game. Does it make you feel any better that the $50 parking fee is included? Probably not.

A snack bar price list at "Jerry World."

Or that this bloated price tag buys the family a brief, one time visit to the below average Dallas Cowboys football team? Here are some average guys inside The Death Star with that analysis:

To summarize, for the outlay of $758 your average family gets approximately 3 hours of average to below average football, plus the experience of being in the new stadium. Hold that thought, please.

Around the same time as this report on NFL ticket prices was published, my Mom called with a question about airline ticket prices.

She and my dad were planning a trip from San Francisco to Chicago soon and she was wondering if the round-trip airfare, $199, sounded reasonable. My answer? No, Mom, that’s not reasonable at all.

I base my answer on my newly devised DHI, or Driving Hell Index. The DHI looks at total miles, divided by miles per gallon of the transportation mode (a mid-sized car), times an average fuel price of $3.59/gallon (AAA statistic 1-30-10), plus a standard cost factor of $129 (AARP rate at Hampton Inn) for each 500 miles, assuming an overnight stay per segment, plus a lowball $30 per day per person for food. Finally, I add in at least $50 a day–which is going to be low in their case–for the remorse factor: “we should have flown, what were we thinking?”

Anyway, if you total these factors for the 3,000 mile San Francisco-Chicago round trip ($566 for gas, $774 for 6 hotel nights, $180 for food, and $300 for regret) the total cost to drive would be  $1,870.

So no, that $199 round-trip fare isn’t reasonable–it’s ridiculously low.

How does this connect with Jerry Jones and The Death Star? Simple: in this modern era where three hours of mediocre football is valued at $758–and the stadium has been full all season–a 3,000 mile round trip from one coast to Chicago for less than half of that price is an astoundingly good value.

That in a nutshell is the revolution in airline ticket prices. What I can’t explain is why no one notices and in fact, why most complain about “high air fares.”

Because in a recent “Consumer Watch,” air travel analyst Terry Trippler conducted a random survey of schedules and airfares comparing ticket prices of today with those from 25 years ago for 27 different cities. When 1982 prices are adjusted for inflation, Trippler found that today’s prices are actually lower.

In 1982 there were three roundtrip flights from Boston to Los Angeles, with the lowest fare costing $298. Adjusted for inflation, that ticket should cost $635 today, but Trippler found that, not only are there nine roundtrip flights instead of three, the lowest fare was just $199.

Flying from New York to Miami? In the eighties there were 21 flights, with the lowest fare costing $188. That same ticket should cost $400 in 2007, but Trippler found that the lowest fare was actually $158 and there are now 25 nonstop flights.

How in the wide, wide world of sports is a $758 dollar afternoon outing reasonable, while a $199 round trip fare is considered “high?” Meanwhile, Jerry Jones has become a billionaire collecting the family fun budget of 108,000 people at a whack, and the US airline industry lost over $2 BILLION last year.

That is the stark raving reality of airline ticket prices and sadly, when you consider NFL football and air travel, the truth. If after mulling this over, you still want to complain about airline ticket prices or attend a Cowboys home game, I think I know why.

_______________________________________________________________________________________________________

Yup, some guy left his “wedding suit” on the airport shuttle. At departure time, he was looking for help. But he’d have to go back through security, claim the suit from the van driver who was miles away at the time, then brought it through security (no one can or should bring ANYTHING, including a “wedding suit,” through security for anyone else) and re-boarded. Not a chance of that happening in two minutes or less–and we were the last flight out of Tulsa for the day. Oops–guess somebody’s buying a new suit. Great way to start a marriage, right?

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17 Responses to “The truth about airline ticket prices.”

  1. […] More here: The truth about airline ticket prices. « JetHead's Blog […]

  2. Dennis Magnusson Says:

    Wow, great tie-in! Loved the road trip analysis.
    Always informative AND entertaining.

  3. Social comments and analytics for this post…

    This post was mentioned on Twitter by mcfryer: Great article, The Truth About Airline Ticket Prices… you should read this http://trunc.it/5swrf

  4. […] here to read the rest: The truth about airline ticket prices. « JetHead's Blog Share and […]

  5. […] Link: The truth about airline ticket prices. « JetHead's Blog […]

  6. Good point regarding the price of tickets, however here in Europe it is debatable given the propensity of airline workers to take strike action. Add that to the laborious effort taken just to get to the airport and the subsequent wait/hassles that greet you once there. As well as all the additional “fees” that are now becoming the norm. And lets not forget the interesting people that you share space with. Yes, you make a good argument but somehow I think that will not hold up very long.

    Keep up the great work.

    • I can see that it is a little different in Europe. Honestly, I use the 300 mile rule: if it’s within 300 miles, we drive, to avoid all of the airport hassles you mention. Because really, if I can drive it in 4-5 hours, it becomes real tempting because any airport experience involves at least 3-4 hours with getting to the airport, checking in, waiting, the flight itself, baggage claim and getting to a destination. The extra hour or two by car is worth it to avoid the other hassles over which a passenger has so little control. Unfortunately, in the US distances are measured in thousands of miles, not hundreds, so it’s not always possible to drive. Thanks for writing.

  7. […] A new aircraft, by contrast, costs upwards of $50-$100 million per aircraft, and hundreds of such aircraft are required to produce a fleet with a competitive route structure. Further, each aircraft has to earn revenue daily despite upturns and downturns in the travel market, as well as drastic fluctuations in fuel costs which follow oil prices. Face it: the cost of an airline round trip is not the same as a set of tires or a Cowboy’s football game–but the public expects to pass less anyway (more details–click here). […]

  8. Bravo!

    Even if you had not said up front you were a pilot, it would have been obvious.
    Usually, people do not count the cost of anything. They are generally impulse buyers. Pilots, however, learn early on to calculate the cost of EVERYTHING! Friends seem amazed when I tell them how much it cost them to drive for one grocery store to another to another, to get “bargains”. They somehow do not grasp the concept that it actually costs you money to drive your car. No, not jut the payment or insurance. Tires, gas, oil, wear & tear, etc.
    Since I own my own plane, I usually don’t have to worry about what the airlines are doing. I do, however, often check (for myself or others) to see if it makes more sense to fly commercial or private. Again, you have to figure in the amount of time it will take to clear security (usually 45 min. to an hour and a half @ IAH or HOU). Then I have what I call the P.I.T.A. QUOTIENT (paint in the a..). That is usuallly very high and worth several hundred dollars!
    Generally, if the times are within 30-45 minutes and the total cost within 250-400 then I take our plane. I Digress….
    Thank you for sharing your insight.
    I am new to your blog, slater being the first one read, comment to follow… But will be checking in often as I appreciate and enjoy you view of things most people would over look.
    Keep the shiny side up!

    R.L.

    • I’m with you on the PITA Quotient: our rule is, within 300 miles, we drive. You really don’t save any time flying lesser distances once you throw in the delays, parking, security hassles and weather problems.

  9. A section of Air India pilots, technicians and employees on Thursday marched to Parliament demanding immediate government action to save the cash-strapped national carrier. The employees, holding Air India CMD Arvind Jadhav responsible for the present condition of the airline, also demanded his removal and regularization of the payment of their due salary and productivity linked incentive.

  10. Nice information about The truth about airline ticket prices. There are very interesting fact i know about that. Thank’s for sharing ………..

  11. nice information about The truth about airline ticket prices.thanks to sharing….

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  12. Another way they airlines rigging the game They charge $400 for bags by making you pay more for a direct flight than someone else who is on the same flight is paying to connect at your destination

    • How exactly is it “rigged” if you already know about it?

      And why didn’t you buy the connecting ticket and just not use the excess segment if it was cheaper than the direct flight?

      Guess you could always drive, although flying is cheaper in both time and money. Given that USAToday in July stated that air travel today is cheaper than it was in 1987, I’m not sure what you’re complaining about.

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