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Due to competition in aviation, the prices of tickets fluctuate. In international trips, it is unpredictable. Because of this the price of tickets on such long trips is contributed by a number of factors that keep on changing from time to time. Global airlines have to keep in mind a number of factors when they are tagging their tickets for several destinations. The final price of tickets is determined after a number of permutation and combination of these factors.
New Airline
New airline is one of the most crucial factors when it comes to aviation. Unlike a number of industries, it involves a huge capital investment and permissions. Most of the money involved are from huge loans and the company stays in pressure to make profit in the first five years of operation, so that it is able to repay the loans. The revenues are directly proportional to the number of travellers that take their flights. For example, American Airlines booking directly throws light on the income of the carrier. Whether the people will book tickets on its flights is not known at the time when it starts operating. Thus, setting up an airline is considered quite risky.
Seeking Permission/Canctions
Getting permission and sanctions from the governments is also a matter, which involves a lot of money and influence. The airline has to seek permission from the concerned authority of that nation about getting allowance to operate its flights within its boundaries. More the number of operating nations, tougher and more time consuming it is to get the permissions. If the carrier is planning to start an international service, it has to pass the safety standards of the countries it looks forward to operate. Even if the carrier is looking forward to initiate domestic services only, it has to get a go-ahead from the government. It takes a significant amount of time and money just to get a green signal to start operations.
Establishment
The cost of aircraft involves hundreds of dollars and procuring them takes years. If a carrier plans to start its services in a particular year, it has to place an order at least five years prior to that. It can afford to order aircraft of one type if it is only operating in the domestic sector. However, when it plans to start international services, it has to order aircraft of several types depending on the duration of the journey. This involves a hefty sum of money and the airline has to spend it even before the start of its operations.
All these factors contribute to the actual price of tickets. Even if travellers are booking cheap last minute flights, they have to pay that amount so the airline breaks even with the costs incurred. There have been several instances where the carrier had to stop services because it could not manage to get rid of the initial loans. This is why, not always, it is possible to offer the cheapest options for flying.
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