Why do the ticket prices of flights fluctuate so much?

Question

Even the same flight going up and down confuses me. I can understand the price raising as demand for that particular flight goes up, (even though that’s a dumb system) but why would it go back down?

In: 5

Answer 1

An airline seat only has value before the plane takes off. An empty seat is a concrete loss, so airlines will do anything in their power to get a butt in that seat. So prices will go significantly down as the time of the flight approaches and the seat is still empty.