Why aren’t last minute airline tickets inexpensive?

At 7:15 pm on Sunday, October 20 I checked the JetBlue web site for fares to Las Vegas. They were showing a flight leaving in approximately two hours at a fairly high price (roughly double what Spirit charges):

The Mint ticket is especially costly, $1,104, given that there are two seats left and only two hours to go.

Maybe the “Even More Space” seats are not truly empty because JetBlue has sold a bunch of regular price tickets and will have to allocate these at the gate to people who did not pay extra.

But that leaves the mystery of why not sell the Mint seats for closer to the next night’s price of $604. Are two people likely to buy those last two seats at $1,104?

Is this evidence of lack of competition in the airline market? In an Econ 101 competitive marketplace, JetBlue should be happy to sell these last seats at any price above marginal cost (essentially $0 on top of the taxes, TSA, and airport fees).

13 thoughts on “Why aren’t last minute airline tickets inexpensive?

  1. Conjecture: if the airlines regularly sold last minute tickets at bargain prices, more travelers might wait to the last minute to try and scoop up a bargain. That could end up lowering the airline’s revenue in the long run. Or something.

    • +1, this seems highly likely. Airlines really want people to book in advance for route planning so they incentivize early booking as a cost of doing business.

      But I also think last-minute bookings were once officially handled as “flying standby” – you had to show up at the airport and roll the dice, preventing mass abuse. But that seems to not be a thing anymore: https://www.shermanstravel.com/advice/how-to-fly-standby-in-2015

    • +1. Airlines want to get your money early and invest it to earn interest and help Visa/MasterCard earn interest as well.

  2. Airlines have had it wrong all along. East coast aero club needs to fix this ages old problem. Last minute seats should be free, like standby.

  3. Because only two seats left in this class and if they don’t move them, they’ll do cheap upgrade at the gate (“upgrade to business for $100” – I did it couple times; or upgrade somebody with high status – never happens to me, I’m not flying enough)

    If there are a lot of seats same day, there are bargain prices. I’ve flown San Jose to Seattle for $75 on the same day, business for $50 more, etc. If you are flying same direction a lot, periodically you’ll see things like this, but they got so good at scheduling, that usually it’s other way around – last seat near the toilet left for the premium.

  4. A last minute seat is a valuable commodity to a traveller on an unexpected, tight schedule. Family emergency requires last minute trip? Ka-ching! for the airline.

    (Speaking as somebody who just paid 2x fair for a trip scheduled on a two day notice)

  5. The answer is in the fine print and legal documents. Basically what it comes down to is if you book and find the flight at a lower price then you can get a refund of the difference. There is paperwork involved and again hidden in the legalise but the ticket price most rise or everyone would be able to get the “late to book”price.

    • I’ve actually had this experience. Bought a three weeks advance ticket, and on the day before departure, decided to check the airlines website again. Got a significant price reduction, purchased and had the difference refunded. But that has been a while.

  6. I’ve had to pay higher prices for a ticket just before departure a few times. My guess is that the majority of travellers wanting to buy a ticket like that are less price-sensitive, and the increased sales volume from lower prices doesn’t justify the difference.

    Using a “roughly double” price as a guide, unless that double price halves the number of last-minute seats sold it seems like a profitable strategy.

  7. Why? Because those last two seats on the flight don’t exist. The flight is oversold or looking to be oversold. Let’s say the first 50% to get ticketed on a flight pay a base price of $100 as the flight gets more full, the prices of the tickets increase to some number, say $200 where it is finally sold out. Now, the airline can advertise a couple of remaining seats for $400 that actually don’t exist, double the going price. A last minute flyer purchases a seat for $400. Now on the day of the flight, at the gate, the airline asks for volunteers to take a later undersold flight and offer a $100 voucher towards the purchase of a next flight. Without adding more passengers, they’ve essentially just added a $100 – $300 profit on a flight that was already sold out. ($400 – ($100 or $200 original ticket price) – (possibility that voucher is never redeemed))

  8. I think that the tickets should be the same price if you buy them a week a head or last minute. If you buy them well in advance then yes they should be cheaper. That way everyone gets a chance to take the ride.

  9. One wonders if JetBlue read your blog post because all flights with cheapest inventory are $31, at least on JetBlue and some AA for 10/31 only.

    The dearly missed AirTran U program offered university student age travelers standby only flights for $25.

  10. Because it’s a lot easier to make money in America by deception, marketing and trickery than by providing a superior product. The airlines know precisely the likelihood that people will buy a last minute flight and they charge accordingly. Those seating charts seem to be nonsense. Full one day, empty the next. I’ve seen where the only free seats were middle seats so that people are compelled to purchased the extra room seats.

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