I’m considering getting one of those cheap tickets you see which is a direct round trip from MSP to Orlando for $60 including fees (it wasnt the date i wanted but it was cheap). How does that make economic sense for the airline? Sure the plane is making the trip anyway, but how can hauling my 200lbs of man meat 1500miles for $30 each direction not more than offset the fuel?
In: Economics
Airline ticket pricing is similar to options pricing. That analogy is too complex for eli5 but that’s my general theory from the few plane tickets I’ve bought.
The airline makes their profit before the plane is full so they can probably afford to take a loss on some seats
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