April 23, 2024

Average airfares to rise as NDC takes hold

Wider NDC adoption is likely to force a 'continued upward trend' in airfares this year, despite a short-term dip this March.

Global average ticket prices (ATP) for air bookings are expected to fall 4% by April – to US$673 – as fares readjust after a sharp increase in the first two months of the year when the ATP exceeded US$700.

However, in its latest Air Trends Report, the CWT Solutions Group says it expects generally rising fares for the rest of the year as NDC solutions gain traction.

“We foresee a continued upward trend in the average ticket price through 2019,” says Christophe Renard, Vice President of CWT Solutions Group.

“One of the reasons is that more airlines are looking to adopt IATA’s New Distribution Capability (NDC) standard as a means to generate greater ancillary revenues such as seat selection and baggage fees.”

Renard adds: “Post-booking price tracking tools can be an effective way for companies to optimise the cost of expensive tickets before upcoming departures.”

The report also suggests travellers’ advance booking behavior will worsen in the next couple of months following a period of “year-end budget considerations and belt-tightening” from December to February.

Around 47% of tickets were booked more than 14 days before departure during this period, but that figure is expected to fall to 43% in March and April.

“In order to keep a handle on costs, travel managers are advised to stress the importance of booking in advance, either as a message displayed on the OBT or through targeted communications to individual travellers,” says Renard.