Take a careful look at what antipyretic offers exist on the market for smartphones and press the button to stop the flight. This used to be common among travelers with limited resources until now. Yet, like many things in times of inflation, the scene has shifted. Higher costs, especially fuel which makes up about a third of airline expenses, following the war in Ukraine, are being felt from afar and push airlines away from old, attractive commercial policies as time goes on.
Ryanair chief executive Michael O’Leary recently stated that rates would not exceed 9.99 euros. The reality is that rising expenses, among other factors, are starting to show up in the prices airlines post for their flights and will become clearer in the near future.
As one observer notes, average prices across companies are no longer under 50 or 60 euros. This view comes from Javier Gándara, president of the Airline Association and Southern Europe director for EasyJet, who sums up that airlines will keep lower prices for some seats depending on the operator. For Ryanair, a mid-August bid priced 19.99 euros for 45,000 seats—low, but still twice as cheap as ultra-low-cost fares. That pricing acts as a promotional tool to spur demand, but it is nearly impossible for a company to survive on those rates alone. Regular tickets will look very different, but how exactly is the question.
Multivariate rates
Sources from Valencia based Air Nostrum describe ticket pricing as a mix of many variables. Pricing shifts by route, season, and even day. Today, however, the market shows instability with costs climbing after a 2021 dip when airlines lowered fares to attract passengers after Covid shutdowns.
All these factors align with a Wise fintech study that analyzed 130,000 tickets from 17 airlines. The findings show traditional European carriers have already raised prices by around 30 percent, with Europe-wide increases near 50 percent for lower-cost segments. In several carriers like Air France, Iberia, Ryanair, and Vueling, the year-on-year change in the minimum purchase price has surged by more than 43 percent from the previous year. This underscores a broader shift in pricing strategies across the continent [Wise study attribution].
Still, the outlook remains uncertain. In the near to mid term, the average rate will hinge on how supply and demand balance on each route and flight, explains Gándara. In a competitive market like aviation, steep price hikes can immediately dampen demand and invite rivals to challenge a carrier’s position, comments Air Nostrum. Transferring higher costs directly into prices is not straightforward, and airlines may need to soften price impacts where possible, especially on certain cost components.
The fuel element stands out as the most critical risk, with the end of the war remaining uncertain. Gándara notes that hedging fuel at favorable prices has largely stopped or ended, adding pressure on future pricing. In addition, broader cost pressures such as inflation and mortgage increases affect consumer purchasing power, creating a squeeze on margins. The alliance head suggests margins will narrow as flight activity rebounds after the pandemic, reflecting a new normal in airline economics.