What is one major factor that impacts airline ticket pricing?

One major factor that impacts airline ticket pricing is supply and demand. This economic principle operates on the notion that when demand for airline tickets exceeds supply, prices tend to rise. Conversely, when supply surpasses demand, airlines often lower prices to encourage more bookings. Seasonal travel trends, economic conditions, and consumer behavior significantly influence this balance. For example, during peak travel times, such as holidays or major events, the demand for tickets increases, allowing airlines to charge higher fares. Conversely, during off-peak times, airlines may offer discounts to stimulate demand.

This relationship between supply and demand is crucial in the airline industry as it directly affects pricing strategies, seasonal fare adjustments, and promotional offers. Understanding this concept helps travel agents analyze market trends and advise clients on the best times to book flights for cost savings.