It was found that airfares are decreasing as Canadian residents’ travel demand decreases due to high interest rates and high inflation. According to the Federal Statistics Office on Wednesday the 21st, airfares in October fell 19.45% compared to a year ago.
Regarding this, aviation industry experts said that after the peak summer season, the number of domestic and international travellers decreased significantly, leading to lower prices.
Last August and September, which were peak seasons, fell by 20% and 21%, respectively, compared to the same time last year, showing a sharp contrast to 2022, when the desire to travel, which had been suppressed due to the coronavirus outbreak, exploded.
Unlike before, when air ticket prices showed an upward trend ahead of the year-end and New Year holidays, it was revealed that they recorded a clear downward trend in October as well.
The airline industry said, “This year’s seat reservation rate reached 92% of the 2019 level just before the outbreak of the coronavirus,” and added, “Airlines are increasing flights and reducing fares.”
In relation to this, Heran Becker, a market analysis expert at TD Bank, said, “As airlines rush to increase flights, seat capacity has increased significantly,” adding, “We are seeing this phenomenon not only on major resort routes but also on flights to major domestic and international cities.”
“The number of airline reservations for the U.S. Thanksgiving, Christmas, and year-end holidays is lower than expected,” he said. “Residents are refraining from traveling as the cost of living is increasing due to rising prices.”
Additionally, Rick Erickson, an aviation industry consulting expert, pointed out, “The entire airline industry is shrinking,” adding, “This is due to the aftermath of high inflation.”
He continued, “When the burden of living expenses increases, travel decreases first,” and “leisure activities also decrease.”
“Statistics from the summer season to October show that airfares have decreased, but compared to 2019, they are about 4.6% more expensive,” said Cameron Dorksen, an analyst at National Bank. “This is still more expensive than before the coronavirus outbreak.”
He continued, “The downward trend in fares is mainly occurring on domestic routes,” and predicted, “Competition among airlines is heating up, so it will continue for some time to come.” He added, “Competition is fierce on routes to and from major resort destinations in the Caribbean, including Mexico, as well as the Vancouver-Toronto route and Vancouver-Calgary route.”