Do airlines hike fares around popular events like the U2 concert?

2019-06-11 06:18:06

When U2's Mount Smart show was announced, concertgoers were quick to claim that Air New Zealand had hiked its fares to Auckland around the date of the show.

One commenter on a Stuff story on the November 8 concert claimed that the airline had doubled the price of flights the day it went on sale.

Another said "Thanks for putting up your airfares to Auckland on the day of the concert Air New Zealand! Checked them when the concert was announced for budgeting purposes and now they are $239 per person one way. #ripoff."

However, an Air New Zealand spokesperson said that flights to Auckland around the U2 concert date had "proven very popular" even before it went on sale.

"To give you an example, seats from Wellington to Auckland and Christchurch to Auckland were sold at our lead in fare of $49 but high demand has seen the cheapest seats get snapped up very quickly. We recommend customers get in quick to secure the best deals."

While Air New Zealand would have worked out its price structure around the U2 concert date long before it was announced, it is possible for airlines to jack up fares last-minute to cash in on a popular event, aviation expert Irene King said.

"Airlines can ramp up fares reasonably easily as they control online prices through their websites. However, whether they would ramp up for a particular concert - if the artist was extremely popular the short answer is probably yes. They are selling a scarce product for which there are people willing to pay the price."

Airline revenue managers divide all the seats on a particular flight into different price levels, or price buckets, based on anticipated demand, King explained.

"Anticipated demand is worked out by algorithms derived from largely historical data although there's an element of forwards looking."

A revenue manager will tip fewer seats into the cheapest bucket over expected busy periods and these are usually the first to go. As departure time approaches, seats will usually become progressively more expensive. If there is high demand to travel to a certain destination on a certain date - because, for example, it is hosting a popular event - this will happen quickly.

"If you want cheap flights on weekends to destinations, then it's wise to book three to six months out because the cheap seats sell out," King said.

If a concert is scheduled for a Friday night or weekend then, concertgoers will be very lucky to bag the cheapest fares. And those who don't get in quick, will inevitably end up paying much higher prices than usual or missing out altogether.

At the time of writing, those travelling from Wellington could get return seat-only fares to Auckland in time for the concert from $268, while those travelling from Christchurch would have to pay at least $428 to be sure of making it on time.

Air New Zealand has offered a glimmer of hope to anyone who does miss out.

"We are currently looking at options to offer additional capacity to cater for this increased demand," the airline spokesperson said.

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