Airfare prices are going up in 2025, survey says

Airfares are forecast to see modest increases across most regions globally in 2025 as airline capacity continues to rise, according to American Express Global Business Travel’s (Amex GBT) latest Air Monitor 2025.

The report anticipates that, after a period of sharp fluctuations, airfare prices are starting to stabilize globally, marking a shift from the more volatile pricing patterns of previous years.

However, despite these stabilizations, the underlying cost of air travel is likely to remain high.

Amex GBT identified several key factors influencing airfare pricing, including the growing trend of dynamic pricing, which allows airlines to adjust their fares based on a variety of market conditions. The integration of New Distribution Capability (NDC), is expected to impact corporate travel buyers as they navigate fare negotiations. Additionally, geopolitical tensions, which could affect fuel costs, and increased operating expenses, such as higher labour costs from new contracts and environmental surcharges, are all contributing to the upward pressure on prices.

Business class fares will rise

Amex GBT’s forecast indicates a year-over-year increase in business-class fares within North America, projected to rise by 2.7 percent.

Similarly, Europe is expected to see a 1.2 percent rise in business-class prices. On the economy-class front, prices are forecasted to increase by 2.8 percent for both regions, reflecting a general trend of price stabilization.

Australia is projected to see the highest fare increases for intra-regional travel, with business-class fares up 7.8 percent and economy-class fares up 13.7 percent year over year.

“In 2025, businesses will be faced with a new reality – even though price rises are levelling off and capacity has returned, fares remain high,” said Gerardo Tejado, SVP professional services, Amex GBT. “Corporates should expect tough negotiating stances from airlines, particularly as carriers evolve their distribution models. Business travel buyers will need to be strategic – for example, around loyalty and programme performance data – to get value in this environment.”

Airlines leveraging AI

The use of artificial intelligence (AI) in air travel pricing is another key development highlighted in the report. Airlines are increasingly leveraging AI to sharpen their revenue management and retailing capabilities.

The report references how AI technologies are reshaping air travel revenue strategies, allowing airlines to better respond to market shifts and consumer behaviour. As airlines continue to innovate in their pricing strategies, the use of AI is expected to become an integral part of revenue management, making it even more important for corporate travel buyers to leverage program performance data and loyalty to navigate this new pricing environment effectively.

View the full report here.