Bad News for Travelers: the Cost of Flying Is Likely to Rise

If you’ve been noticing higher flight prices lately, you’re not alone. Airlines across the US and beyond are quietly hiking fares, and according to industry experts, this trend isn’t likely to be versed anytime soon. The combination of strong consumer demand for flights, aircraft shortages, minimal competition, and unknown future operational costs means airlines are trying to maximize their profits now — and consumers should brace for steeper ticket prices in 2025 and beyond.

A new Reuters report highlights rising profit forecasts for major airlines, spurred by increases in the cost of flights. And a recent US Bureau of Labor Statistics (BLS) report shows that airline ticket prices increased by 7.1 percent year-over-year between January 2024 and January 2025, well over the consumer average across all expenditures of three percent. The drastic increase is likely a result of airlines taking advantage of being on the winning side of the supply-and-demand balance. Inflation was at a 42-month low of 2.4 percent in September of 2024, indicating most the rise has happened in late fall and early January of 2025.

Whether you’re a frequent flyer or planning a big trip in the coming year, understanding why fares are rising can help you budget for future trips — and decide when is the best time to book your upcoming flight.

Why is the cost of flying going up?

There are a few factors, but the primary one is probably the most basic: supply and demand.

Fewer planes, fewer flights, higher prices

A major contributor to rising airfares is the ongoing shortage of aircraft, partially spurred by manufacturing issues, safety concerns, and production delays from suppliers like Boeing. This makes it difficult for airlines to expand their fleets or offer additional flights, increasing the gap between supply and demand. And when demand outpaces supply, prices rise. Limiting available seats allows prices to stay high, which spurs secondary costs, such as paid upgrades when a flight is too full to allow for complimentary loyalty program upgrades. When all four of the major airlines raise their prices, smaller airlines can also raise their prices, even if they don’t rely on the same manufacturers.

International airlines are also suffering from the same production issues and adjusting prices accordingly. According to Reuters, Turkish Airlines has 17 percent of its planes out of service, and expects fares to raise about 25 percent this year in response.

Traveler demand remains high

Despite higher prices, travel demand from consumers has remained strong, particularly among the wealthier travelers airlines are most likely to value. The Reuters report notes that households earning $100,000 are driving much of the demand with a willingness to pay extra for perks like direct flights and business-class upgrades. Even if the cost of flying rises too much for the average consumer, the wealthiest in America will still travel enough for airlines to maintain high prices. Wealthier travelers can also absorb higher ticket costs, allowing airlines to raise prices without losing customers. “Global airlines body IATA has forecast about a 15% year-on-year jump in net profit per passenger for North American airlines in 2025,” writes the Reuters report.

Of course, this poses challenges for budget-conscious travelers, who are likely to find fewer deals and have increasing limited access to low-cost airfare options, especially as the remaining smaller airlines in the US undertake mergers.

Airlines can charge more with less fear of consequence

For economists, this isn’t a suprising shift. The US airline industry is dominated by just four major carriers (American, Delta, United, and Southwest), which together control more than two-thirds of flights in the US. This near-monopoly limits competition, reducing the risk that raising flight prices will cause customers to buy elsewhere, or allow smaller companies to gain market share. Republican administrations also tend to support economic policies that are more favorable for businesses, which could be spurring confidence.

Consumer protections could also weaken under the Trump administration, which has previously signaled support for deregulation and is currently starting the process of closing the Consumer Financial Protection Bureau, or CFPB — a move that could make it easier for airlines to introduce policies that prioritize profits over passenger satisfaction. Travelers could face higher fees, reduced compensation for delays and cancellations, and fewer options for recourse when airlines act unfairly.

Airlines are trying to maximize profits while their margins are wider

According to the Reuters report and BLS data, the costs of flying are likely to continue to rise in the coming months. Airlines are facing potential economic impacts from US political shifts, such as a proposed 25 percent tariff on foreign aluminum. That’s likely to impact manufacturing supply chains, and raise the costs to manufacture and maintain planes — costs that will likely be at least partially passed to consumers. Ongoing trade disputes and taxes on fuel could also increase airlines’ business costs, motivating them to try to maximize their profits now, before any of those changes take effect.

How can travelers keep the cost of flying low(er)?

It’s likely going to be difficult, and some travelers may be better off booking travel sooner rather than later, as experts think the cost of flying will continue to rise. However, if you can’t book right away, these strategies may help you stretch your travel budget.

• Book Early: Airlines are moving away from last-minute discounts, so booking months in advance is the best way to lock in lower fares. You’re less and less likely to find reduced fairs if you wait until days before your flight. And, with fewer flights and more travelers, you’ll probably get stuck in an uncomfortable middle seat, too.
• Use alternative airports: Major hubs tend to have higher prices, while smaller regional airports may offer better deals.
• Avoid weekends: Traveling midweek or during off-peak seasons can significantly reduce costs. Consider visiting Paris in November, or planning your vacation from Tuesday to Tuesday, instead of Saturday to Saturday.
• Consider getting an airline credit card: Having a credit card can significantly hurt your credit if you don’t use it correctly, so read all the terms and rules before you sign up. But if you are comfortable opening a new account, many airlines have partnerships with major credit card companies that will give you frequent flyer mile bonuses when you sign up, and make even include other perks for free. For example, travelers who hold a Mileage Plus credit card through Chase can get free checked bags when they book flights, potentially offsetting the impact of higher ticket prices.
• Use price tracking tools: Price-tracking tools can notify you when fares drop, allowing you to book at the right time. The most widely used is likely the ticket tracking notification via Google Flights, which will send you an email alert when flight prices drop below a certain amount for any flight you’re considering.

With airlines focusing on profitability and external pressures driving up costs, the era of bargain airfare may be fading — or at least temporarily shrinking — in the US. Both the Reuters report and BLS data confirm what many travelers have already noticed: that flying is getting more expensive, and there’s no sign of fares dropping anytime soon. Whether you’re planning a domestic trip or an international getaway, staying flexible (and keeping a close eye on the few flight deals that are available) will be key to sticking to your travel budget.