A few years ago, Eduardo de Nascimento Barbosa (name changed on request), an executive with a telecom company in Mumbai, decided he would leave for Goa, his home State, to spend Christmas with his family. But when Barbosa searched for tickets on various websites, including Cleartrip, Makemytrip, Yatra, Easemytrip, Goibibo and Ixigo, he found that the one-way fare would wipe out more than half his monthly salary. Compounding matters, bus and train tickets had been sold out. Finally, he hopped on to the Konkan Kanya Express train the following night, in the unreserved section, standing for much of the journey, sitting on the floor the rest of the time, and got home exhausted by the ordeal.

Cut to today and little has changed. Sonali (name changed on request), a Mumbai resident working in, of all things, the travel trade, recently found herself in the same predicament. She planned to take a holiday in Europe with her family during the Diwali break. However, like Barbosa, she had not booked her tickets in advance, and found to her chagrin that the last-minute fares would burn a hole in her pocket. "The difference in fares was as much as Rs 10,000 per person from the time I initially planned the holiday to the time I decided to book my tickets," she recalls. Eventually, since the fares were high even for the week after Diwali, Sonali decided to postpone the holiday to November, between the Diwali rush and New Year, and is still waiting for a good deal.

 

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If this could happen to someone in the travel industry, it could happen easily happen to you. If you haven’t booked that holiday ticket yet, you may well find yourself struggling to find a low fare at the last minute.

Fares already rising

Last year, during the Christmas season, it was not uncommon for booking engines to show a one-way fare of anything between ₹22,000 to ₹25,000 for tickets sought two days before travel to Goa, said a top executive at an online travel portal, speaking to  BusinessLine .

Similarly, last-minute one-way air fares last December from Delhi to Kerala ranged between ₹18,000-20,000. Since fares for flights within India have hardened this year, last-minute fares to these two destinations, and to other destinations, are likely to be higher this year.

Travel and hotel booking e-commerce website Ixigo says it has seen a 12-15 per cent average increase in year-end airfares for 2019 compared to the same period last year. Fares on routes such as Delhi-Bengaluru and flights to Goa have seen an increase of 80 per cent and 60 per cent. It expects ticket prices to increase by another 22-25 per cent in the coming weeks due to a surge in Christmas and New Year holiday traffic.

However, in comparison, and perhaps because people are watching their expenses in the midst of the ongoing economic slowdown, winter fares for 2019 booked 60 days in advance are showing a dip of 15-20 per cent for popular destinations. In 2017, international fares for year-end bookings had registered a growth of 30-35 per cent over 2017.

Destinations that are gaining popularity among Indian travellers this winter include Singapore, Indonesia, Dubai and Abu Dhabi and long-haul destinations such as Russia, Prague, Austria, Norway, Canada and Japan. Within India, Kerala, the Andamans and Rajasthan are popular destinations.

Travel companies recommend that travellers book their tickets at least 30-35 days in advance for domestic flights and 60 days in advance for international flights to get the best deals for both airfares and accommodation. A major reason for this is that travel companies cannot predict with certainty whether there will be a decrease or increase in prices closer to the date of flying.

Read also: Why international flights from India take off at insane hours

Dynamic fares

Conventional wisdom, too, says that if you book well in advance you are likely to get get lower fares. However, this logic worked till Indian skies were opened to private players in 1994, as until then, airlines had Advance Purchase Excursion tickets or APEX fares. The lowest fare would be available for those booking 90 days out; those booking 60 days before their travel paid a bit more, and those booking 45 days ahead paid a little more, and so on, till the date of the flight.

At that time, if an airline started filling aircraft earlier it would know in advance exactly how many passengers would be on a particular flight, enabling it to better plan its costs in terms of fuel, landing and parking.

Unfortunately, this system has now been replaced by dynamic pricing, which means that as demand for seats goes up, so does the price of an air ticket. All domestic airlines report the lowest and highest fares that they charge to the Directorate General of Civil Aviation (DGCA) and also display them on their websites. As long as the airlines do not charge more than the highest fare shown to the DGCA and on their websites, they are good to fly.

A perishable commodity

In theory, all this sounds very good. But in reality, things can be very different. An aircraft seat is a perishable commodity. Once the aircraft has taken off and a seat has remained empty, the airline has lost revenue forever. So, it is not uncommon for airlines to sometimes reverse conventional wisdom and sell seats at the last minute at lower fares.

One does not need to look far to find an example of this. State-owned Air India, perhaps because of the red hue on its balance sheet,allows seats to be booked on its website up to six hours prior to departure time. This facility is available on select sectors within India, every day, sometimes offering discounts of up to 40 per cent.

Since most airlines open their booking for flights 365 days before the day of departure it is theoretically possible to book a ticket a year out and thereby get the cheapest fare. Passengers in Europe and the US are known to make such bookings.

Today, airlines’ booking systems have various algorithms that keep pushing up the cost of seats being sold on a flight. Often you will find the person sitting next to you on a flight may have paid much less despite booking a ticket weeks after you did.

If they want it, travellers will be able to find advice on how to find the lowest fare on websites such as Kayak. These tips include having flexible travel days — Kayak maintains that flying within India on Saturday is cheaper than on other days. Travelling mid-week (Tuesday or Wednesday), it says, is also cheaper than flying on Monday, Thursday or Friday. Indeed, flying on Wednesday might be a good idea — globally this is considered a day when airports are the least crowded.

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