Holiday airfares surge due to seat cuts and rising fuel costs

Holiday airfares are projected to reach decade highs due to rising fuel costs and reduced seat capacity. In the United States, Thanksgiving flight costs have increased by 31%, averaging $402, while Christmas fares have risen 23% to $452. This trend is driven by airlines trimming domestic seats—approximately 3% in the US—and soaring jet fuel prices. Carriers such as United, American, and Southwest are scaling back certain routes or capacity growth to protect profit margins despite strong passenger demand.

Similarly, in India, domestic airfares on major routes have seen sharp increases, with Delhi-Hyderabad fares rising 68% and Mumbai-Kolkata fares up 51%. While total seat capacity in India has only decreased by 1.2% due to the use of larger aircraft, the number of scheduled flights has dropped by about 5%. This reduction in flight frequency limits passenger options, potentially driving up costs as cheaper fare categories sell out. December 7 is identified as a peak period for domestic flight capacity during the final quarter of the year.