How It Fares

I have been selling airline tickets as a Travel Agent since 1983, so I started to see how fares were calculated from the beginning. I have always been interested in how airline fares are calculated and how I can get the best fare for my customers.

I am not a mathematician or an IT professional. Just a Travel Agent who likes figuring out how things work.

I like to keep up with new developments in the airline industry, so if you are too, feel free to email me your questions or comments at:

These days, when shopping for a deal on an airline ticket, consumers can compare the fares of 22 different airlines at a time with relative ease. But with so many carriers and fare classes available, it’s easy to get lost in the sea of acronyms and numbers.

That’s why we’ve created this blog. It aims to help educate consumers about the process used for calculating airfares and will hopefully shed light on where your hard-earned money goes when you purchase an airline ticket. After all, you deserve to know why you paid $1,200 for that flight from New York to Los Angeles while your neighbor paid only $450.

I have been a travel agent for 20 years and have flown millions of miles on airlines all over the world. I’ve booked thousands of tickets and worked with many people to find the best deals possible. I’m also a frequent flyer on American Airlines and have been following their recent filing for bankruptcy. American has asked the court to allow them to throw out their current labor contracts which will cause widespread layoffs and possibly strikes.

I want to write about airfare pricing but am not sure where to start. In this blog, I will not be telling you what fares are good or bad; instead, I will explain how airlines calculate fares so that you can decide for yourself what fare is fair.

I am a software engineer and mathematician who has been working in the airline industry for over 15 years. I have worked on the reservation systems of three major airlines, and have written software for pricing, inventory, revenue management, and scheduling. I’m currently working on the next generation of flight shopping websites.

I started this blog because I enjoy talking about airline fare structures, and thought it would be fun to share my knowledge with others. I will write about how fares are calculated from scratch, how airline pricing works in general, how airlines make money (or not), what is an e-ticket (electronic ticket), what is a PNR (Passenger Name Record), why do you have to pay for baggage but not for a seat assignment or a soda, why are some flights more expensive than others when they are on the same plane and take off minutes apart, and other topics that may interest you if you fly often.

Some of these topics can be quite technical and abstract, so I will try to keep things as simple as possible while still staying at a reasonably high level. If there are any parts that are unclear or confusing please let me know.

When you’re buying an airline ticket, how do you know that you’re getting the best deal?

You can try to figure out which website will give you the lowest fare. You can try to time your purchase just right. Or you can give up, close your eyes and click “purchase.”

In this series, we’ll show you what goes into the price of a plane ticket and give you some tips for getting a better deal.

Airplanes are the safest, most reliable form of transportation ever invented. No matter what the airline companies suggest, you probably should not drive instead.

The same airplanes that are so safe are also extraordinarily complex. The number of parts, miles of wiring and circuits, valves, sensors, and pumps is mind-boggling. There is more computing power in an airplane than there was in the Apollo space missions. And the software is even more complex than the hardware.

So why don’t airplanes fall out of the sky more often? Because for all their complexity, airplanes and their engines are designed to fail safely. For example:

* Airplanes have two or three complete sets of control surfaces (rudders, ailerons, elevators). If one fails or jams, others can take over its job.

* Engines have multiple igniters so if one fails another can take over. If a jet engine loses a turbine blade it continues to run just fine on the remaining blades (this happens all the time). If an engine loses thrust completely it can be shut down with no harm done to the airplane; you’ll just be flying at lower altitude with less fuel efficiency on your remaining engines.

* Fuel lines have multiple pumps and filters so

When you buy something for a certain price, it seems like there ought to be a law or a rule that says that’s the price you paid and that’s what it should cost. You’re wrong!

Airlines don’t sell seats, they sell tickets. And those tickets are not always priced the same for all passengers. Sure, there are base fares which are the same for all passengers, but there are also charges for other things called “ancillaries” like checked bags and seat assignments which can vary from passenger to passenger.

The reason airlines use this kind of pricing is because they want to create an inventory of seats with different prices so they can maximize their revenue. And airlines have gotten very good at this since the 1990s when pricing flexibility was first introduced in the US.

Some of you may be wondering: “Wait, how do airlines get away with charging different people different prices for the same seat? Isn’t that illegal?”

It is not illegal but it is illegal to charge two people different prices on the same flight if they purchase their ticket at the same time. That’s why airlines don’t allow you to see other people’s fares when you’re shopping online. They don’t want you to realize that there is any variance in what people

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