Singapore airfares cost 27 per cent more than before Covid-19 – so why are prices so high?

Industry insiders say demand ‘is off the charts’ across all categories of travellers, who are opting to stomach higher costs after being grounded for so long

Reasons for sky-high ticket prices include scaled-down flight networks, soaring fuel prices, widespread staff shortages – and airline’s battered balance sheets

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A Singapore Airlines plane takes off at Changi International Airport. A study found the cost of flying from the city state was on average 27 per cent higher in April than in 2019. Photo: Reuters

Published: 10:06am, 7 Jun 2022Updated: 10:10am, 7 Jun 2022

For more than two years, the main topic of conversation pretty much everywhere has been about the impact of Covid-19. Now that the worst of the pandemic seems to be over and people are travelling more freely again, another hot topic is on everyone’s lips: expensive plane tickets.

People are looking for flights – sometimes their first in years – in a rush of what’s been termed “revenge travel”. Internet searches show sky-high airfares for many routes, yet travellers with wanderlust are opting to stomach the higher costs after being grounded for so long.

“Ticket prices are really expensive these days,” said Jacqueline Khoo, who works in tourism. Her company paid S$5,000 (US$3,632) for a colleague’s return trip with Singapore Airlines Ltd. to Hamburg later this month. That used to cost about S$2,000, she said. “It’s really amazing that an economy seat ticket would cost you so much.”

Cathay Pacific planes are seen parked at Hong Kong International Airport. Economic-class tickets from the city to London later this month cost as much as US$5,360. Photo: Yik Yeung -man

Searches for a return economy-class ticket between Hong Kong and London on Cathay Pacific Airways Ltd. in late June turned up prices as high as HK$42,051 (US$5,360), which is more than five times the typical cost before the pandemic. Direct flights between New York and London around the same time cost more than US$2,000 in economy.

A Mastercard Economics Institute study found the cost of flying from Singapore was on average 27 per cent higher in April than in 2019, while flights from Australia were 20 per cent more. Increasingly, travellers are booking tickets months in advance as they are worried about the cost of buying at the last minute, said David Mann, chief economist for Asia-Pacific, Middle East and Africa at the institute.

“The demand is off the charts,” Delta Air Lines Inc. CEO Ed Bastian said at an industry conference last week, noting that fares this summer may be 30 per cent higher than pre-pandemic levels. “It’s coming with leisure, it’s coming with premium customers, it’s coming with business, it’s coming with international. It doesn’t matter what the category is.”