If you’re planning on booking a flight this summer, you might want to rethink your budget.
According to CNN, airfares are expected to go up this summer even more so than usual due to the widespread grounding of Boeing 737 Max aircraft.
After the crash of an Ethiopian Airlines plane back in March, as well as a Lion Air crash in 2018, both U.S. and international airlines began to take their own Boeing 737 Max 8 planes out of service for an indefinite amount of time while an investigation is being conducted. Currently, 371 planes are currently grounded worldwide, according to CNN.
Some airlines, including American Airlines and Southwest Airlines, have begun to extend their grounding of the Boeing 737 Max through August, resulting in thousands of flight cancellations. United Airlines has announced a cancellation of all Boeing 737 Max flight until July, according to the Epoch Times.
With so many planes out of service, particularly for Southwest Airlines, United Airlines, and Norwegian Air, companies have already begun to feel the pinch. A fewer number of seats on planes is bound to result in higher fares. With budget airlines, like Southwest, for example, offering fewer flights, competition for lower price fares becomes far less steep for other carriers, according to CNN.
In addition, summer tends to be the busiest season for most airlines, especially since there are more people traveling by plane than ever. Many companies often put extra planes into service during these busy times to keep up with demand, but the widespread grounding also means there are fewer planes available to fill the gap, CNN reported.
Robert Mann, an independent airline consultant, told The Points Guy, “Those yet to book may see limited available inventory, which could push them up a bucket in the fare structure.”
The change in supply and demand ultimately gets passed along to the customers. According to Fortune, American Airlines expects a fare hike around 2.5 percent, while Southwest expects prices per seat to go up by nine percent.
While no one likes to have to pay more, these projections show a fairly nominal increase that customers may see this summer. However, in some cases, the fare hikes may result in people deciding not to fly at all for their summer vacations.
“There’s a limit to how high fares can go because eventually people opt out and people drive,” Helane Becker, managing director at the investment banking firm Cowen, told The Points Guy.