The largest low-cost airline in the U.S. announced a 71% increase in ticket prices

Frontier Airlines, the largest U.S. low-cost carrier, reported that in the third quarter, the average price of its airline tickets rose 71% year-over-year. CNBC explains that the company was thus attempting to pass on to passengers the costs associated with the sharp rise in jet fuel prices. The airline’s jet fuel expenses jumped 82% in the quarter to $425 million.

Taking into account numerous additional fees, including those for checked and carry-on baggage, Frontier’s total revenue per passenger in the third quarter, which ended on September 30, increased by 30% year-over-year to $138.22. A significant portion of this growth was driven by a 71% increase in average fare revenue per passenger, which reached $67.82 compared to $39.74 a year earlier. The airline’s quarterly revenue rose by 53% to a record $1.35 billion.

Despite the price increases, passengers continued to book tickets actively, according to CNBC. In the third quarter, Frontier carried more than 9.8 million passengers, an increase of 18 percent—or 1.5 million passengers—compared to the previous year. The low-cost carrier reported that demand remains high even at current prices. However, despite these strong results, the airline’s net loss in the third quarter widened to $104 million, compared with $77 million a year earlier. Excluding one-time items, Frontier posted a profit of $40 million ($0.18 per share), which, according to the company, significantly exceeded its own forecast.

During trading on Wednesday, October 28, Frontier's stock rose more than 9% to $6.07.

Airlines, from Delta Air Lines to Frontier, note that passengers are largely continuing to book flights despite higher fares, according to CNBC. However, record-high jet fuel prices—the second-largest expense for airlines after labor costs—are cutting into their profits. According to the latest data from the IATA Jet Fuel Price Monitor, the global average price of jet fuel reached $196.7 per barrel for the week ending October 23. This is 118.5% higher than it was a year ago.

On October 20, Michael O’Leary, CEO of Europe’s largest airline, Ryanair, warned that rising jet fuel prices could lead to a record increase in airfare prices in Europe next year—up to 20 percent. However, even that, according to his estimates, may not be enough to cover the carriers’ “sharply increased” kerosene costs.

This article was AI-translated and verified by a human editor