How Airlines Work

By: Kevin Bonsor

That's the Ticket

Anatomy of an airline ticket

Once you determine your destination, your next step is to call the airline and make a reservation on a flight. Airlines employ many people who process these reservations and your tickets. There are personnel who take care of travellers at the reservation desk and the check-in counter at the airport. There are two types of tickets:

  • Paper tickets - This is the conventional ticket that passengers have been using for decades.
  • Electronic tickets - Many travelers are starting to use electronic tickets, or e-tickets, instead of paper tickets, according to Delta Airlines's document "The Plane Truth." Electronic tickets are typically purchased over the Internet. At the airport, passengers with e-tickets need only obtain their boarding pass by providing the gate agent with a confirmation number and proof of payment (sometimes, they only need to show a photo I.D.).

For most people, ticket pricing can be the most confusing part of air travel. Fares are constantly changing. What your friend paid yesterday for a flight from New York to Chicago is probably not what you are going to pay today for the exact same flight. Even the people sitting in the same section of a flight likely paid very different prices for their tickets. Believe it or not, fares are cheaper today than in 1978, which is why more people are flying than ever before. Fares are tracked according to what a passenger pays (in cents) per mile. In 1978, passengers paid approximately 19 cents per mile. In 1997, passengers paid about 14 cents per mile.


Many travelers are choosing to buy electronic tickets. In some cases, passengers with e-tickets can check themselves in using a self-service check-in machine.
Photo courtesy Lufthansa

There are several factors that contribute to the cost of a fare:

  • Purchase date - The earlier you buy a ticket, the cheaper it will be (most likely). For instance, Delta loads a flight into its reservation system about 332 days from the actual flight date. Someone who buys a ticket on the day the flight is entered is going to get a cheaper fare than someone who buys a seat on the day of the flight.
  • Class - Put simply, first class is more expensive than coach.
  • Destination - There are certain destinations that cost more, either because of the distance to the destination or the popularity of the destination. This is simple supply-and-demand economics.
  • Flight date and time - Flights that depart earlier in the day tend to have lower fares because fewer people are flying then. Also, fares go up in the summer vacation season.
  • Fuel costs - Fuel is an airline's second largest expense. Only labor costs more than fuel. In 2000, airlines paid about $5.4-billion in fuel costs, according to the Air Transport Association (ATA). Any increase in fuel costs is usually passed onto passengers in the ticket price.
  • Competitors' fares - An airline has to be careful not to price their fares too much higher than their competitors. Sophisticated computer software is used to track the fares of competing airlines.
  • Special factors - There are certain specialty fares given to senior citizens, government and military employees and corporate customers.

Another factor that can affect ticket pricing is the hub system itself. If a large airline controls a lot of the gates at a particular airport, it may charge higher ticket prices. That large airline has the most flights coming into that airport, so consumers have to pay the higher fares if they want to fly into or out of that airport.

Airlines often overbook flights, according to the ATA. Overbooking is the practice of selling more tickets for a flight than there are seats available. Airlines justify this practice by using historical analysis of traveller behavior. Often, travelers don't show up for a flight that they have a reservation for, or they don't make it to the gate in time. There are also travelers who reserve seats on multiple airlines and flights to ensure their travel plans. The ATA reports that airlines take great care in selecting which flights to overbook. They look at a flight's history of no-shows and try to match the overbook number to that.

Obviously, overbooking can sometimes cause problems, such as when more people show up for a flight than there are seats available. When that happens, airlines give special incentives to travelers who are willing to give up their seats. Usually, these volunteers are given free fare on another flight. If an airline is forced to bump a passenger involuntarily, the airline must compensate that person.

When you board an airplane, you might not be aware of all of the gears that are turning behind the scenes. There are many people performing many functions to get you to your destination.

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