Second-Quarter Int'l Airfares Highest Ever, Says Amex - 2008-08-26
Average one-way international airfare reached new heights during the second quarter, according to the American Express' Business Travel Monitor released this week. Studying client data on 160 international citypairs originating from North America, American Express documented an 11 percent increase in one-way international fares from April to June, compared with the same period last year.
American Express said the average $1,980 per-way international airfare during the quarter represents the highest quarterly average fare it has recorded since initiating the Business Travel Monitor in 1999.
American Express Business Travel Global Advisory Services vice president and general manager Herve Sedky said fares from North America to Asia witnessed the greatest increase during the quarter, surging by 15 percent. Meanwhile, fares to Europe grew by 9 percent, representing the lowest percentage increase across all regions.
In addition to the highest increase, Asia also boasted the highest fare—which averaged $2,485 per way during the second quarter, up from $2,155 from the same period last year. Fares from North America to South America increased 13 percent from the second quarter in 2007, growing to $1,589 from $1,409. Sedky said the average fare includes taxes and fuel surcharges, which have proliferated this year.
Despite a higher average fare paid, business travelers traded down in greater numbers to lower-bucket fares, Amex said. The percentage of international business class tickets decreased to 49 percent, which Amex said represented the lowest percentage of business class tickets sold since the third quarter of 2004.
"Increases in the percentage of tickets purchased in other classes of service show that companies are employing strategies to encourage travelers to trade down to other classes of service," American Express said in a statement. In the past two years, international business class fares comprised as much as 53 percent of all international tickets sold, Amex data show.
Sedky suspects the slight decline in business class usage represents either the development of new corporate policies governing business class use or further compliance measures. "We're counseling clients to really look at their policy and increase their compliance to policy," Sedky said. "Some don't have to change the policy, but just make sure they implement the right change-management vehicles and the right monitoring vehicles to make sure people follow the policy. We're seeing that extra effort result in that business class shift."