Those Wacky Airfares

With the current trend towards Internet-based travel, airfares have become more confusing, unpredictable, and treacherous. Here’s why.



These days many airlines, including Air Canada, sell tickets the way that service stations sell gas—their prices go up and down depending on what the competition is doing. This might seem like a good thing, but it has resulted in an airfare system that is even more confusing than the old one. And unlike buying gas, which is pretty simple and something most of us do all the time, searching for airfares can be frustrating and baffling to those who do not do it professionally. With prices swinging wildly up and down all day, if you’re not constantly shopping for airfares how do you know what is a good deal?



What has happened is that most North American airlines have radically changed the way they price their airfares. Up until recently all airlines used an “inventory control” system to determine their fares. It is simple to understand and is based on the principle of supply-and-demand. If there are lots of seats available, the price will be low. If space is tight, particularly around holiday periods, airlines will typically charge a lot more. The idea of the old system is to get a fair price for a seat, which is a perishable item, based on demand and the amount of time left to sell it.



Lately, however, thanks to the chaotic nature of the Internet marketplace, many airlines are abandoning “inventory control” in favour of a “dynamic pricing” system. This is an impressive-sounding expression for being a “copy-cat” at setting airfares. Air Canada, for instance, monitors electronically what WestJet, Jetsgo, and other competitors are doing day-by-day (and in some cases perhaps minute-by-minute), and adjusts its prices accordingly. The result is much like our local gas stations, whose prices fluctuate up and down according to whatever the guy down the road is charging at the moment. There will be no rhyme or reason for the price other than this. Sometimes this will be great for consumers, but quite often we feel we are getting “burned” by prices that are too high for no good reason.



Fortunately, our agents can help. Just as regular drivers know what is a good deal for gas, our agents, who deal with airfares all day long, can help you sort out what is a good price for a ticket. We are trained to consider historical issues, amount of advance notice involved, available inventory, and many other factors. We will help you decide whether to “lock in” at the present price or allow us to monitor for better airfares. The moral of the story: the more complicated the world becomes, the more you need an expert to help you navigate safely through it.