Answer: high air fares.
Great analysis in one of the New York Times blogs…
The writer wanted to figure out why, say, an average passenger flying out of Newark Liberty Airport pays about 25 percent more than someone flying out of John F. Kennedy International for an equivalent seat on an equivalent flight.
So, he cranked some nums re: airline pricing, and sorted airports as ‘relatively overpriced’ or ‘competitively priced’.
He modeled airport prices based on distance to destinations, size of market (how much ‘traffic’), and competitive structure – i.e. the market share at the origin and destination airports held collectively by the five “legacy carriers” (United, American, Delta, Continental and US Air); the market share held by Southwest Airlines; and the market share held by the largest single carrier at that airport (for instance, Delta and its affiliates are responsible for about 66 percent of all traffic at Atlanta).
He concluded that prices are higher where:
- Legacy airlines dominate an airport
- Southwest has a large share as opposed to other low-cost carriers like AirTran and JetBlue.
- One airline dominates an airport, regardless of whether it is a legacy carrier or a low-cost one.
Here are overpriced airports:
For ‘competitively priced’ airports, the “unifying theme” is that many are warm-weather vacation destinations, like Las Vegas and pretty much anywhere in Florida.
Why?
Leisure travelers are more price-sensitive than business travelers since they, not their company, are paying for the ticket. To keep them flying, prices have to be relatively low,
Here are the bargains:
A very clever analysis … Worth reading the details:
http://fivethirtyeight.blogs.nytimes.com/2011/04/06/which-airports-have-the-most-unfair-fares/
Thanks to BM for feeding the lead.
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