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Air fares to become more complex in 2005
Air fares for business travellers are set to become more complex and varied in 2005 as intense competition leads to airlines repeatedly changing their price structure, according to Carlson Wagonlit Travel.
The travel management firm points out there are now three additional fare options in Europe – those from low cost carriers, dynamic fares from traditional carriers and lower fare options in long haul business class.
The low cost carriers have forced the mainstream airlines to offer an increased number of cheaper fares in return for constraints, such as booking a week to ten days in advance.
Carlson Wagonlit believes an even wider range of fares will be offered this year. “There will not only be an increase in the variety of fare type and levels in 2005, but there will be additional complexity,” said a spokesman for the company.
“For example there will be constant changes route by route, caused by increased emphasis on yield control and competition.”
Another major trend predicted in 2005 is that airlines will charge different prices by country, following a change to the International Air Traffic Association rules.
Companies are now permitted to make their purchasing decisions based, among other things, on the most advantageous exchange rates.
Overall inflation of fares is expected to run at around 5 per cent unless there is a significant drip in the price of jet fuel.
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