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Today (Friday) I was about to book a round trip ticket Mumbai(BOM) - Beijing(PEK) - Mumbai(BOM) via Hong Kong by Cathay Pacific airlines leaving Mumbai on 18th Oct (Saturday) and coming back from Beijing on 27th Oct (Monday). Below is the screenshot from the official website of the said airline showing the price to be INR 57,028 (USD 927.66).

enter image description here

But just out of curiosity i checked what the prices are for an earlier date and I selected the dates to be such that they are the same day as my intended days and with same number of total days i.e leaving Mumbai on 4th Oct (Saturday) and coming back on 13 Oct (Monday). I was thinking that surely this would be at least the same price if not higher and to my surprise the price was significantly lower, it was INR 44,314 (USD 720.85) as seen in the screenshot below.

enter image description here

I had always heard that in general the prices go up as the dates approach your travel date. Off-course there could be fluctuations in the price but you wouldn't expect to see the kind of drop seen above considering that 4th October is tomorrow.

So can I extrapolate this data and assume that on 17th Oct (Friday) the probability that the price for my intended ticket would be around INR 44,314 is higher than the probability that it would be around INR 57,028.

I understand that it would be risky and maybe silly to make such an assumption considering that there are many variables involved in the equation which determines airline price but what would you do? Seeing this data would you wait till the end or just book it right now?

I don't travel international much so maybe its not that unusual to see this kind of drop in prices.

FYI: both the screenshots were taken at 08:55 GMT on Friday, October 3, 2014

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    Pricing (yield) of flights is very, very complex. Your chances of guessing what the airline are going to do next are slim to none. For a start some of the decisions on this type of price is manual, performed by the commercial department in real time.
    – user9533
    Commented Oct 3, 2014 at 12:53
  • I would guess that those are "last minute" discounts for seats the airline has not yet been able to fill. After all, those depart tomorrow!
    – Michael Hampton
    Commented Oct 3, 2014 at 18:58

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Prices are based on available seats within each fare class (and economy cabins can have numerous different fare classes or fare buckets in industry parlance).

The fact that you found a lower fare closer to departure simply means that on that flight there are still cheaper seats available. Airlines start with X seats in a fare class, when those seats sell the booking engine will show the next higher fare class. But depending on how sales are going for an individual flight, the airline's revenue department may decide to add more seats to the lower fare class to try and fill the plane. They could just as easily remove seats from a fare class if sales are ripping right along.

Airfares do appear go up as you approach your travel date, but this is due primarily to advance purchase requirements on the most deeply discounted airfares cause them not to be shown at 21 or 14 or 7 days prior to the departure date (depending on the fare class). So all you see are the more expensive fare classes

Airfares are constantly being adjusted, as is capacity within each fare class. You may find come Monday a totally different set of prices if you check the same flight combinations.

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    pricing is not just based on seats left open (unless you get real close to departure) but on predicted load percentages. If a flight is predicted to sell out they're not going to discount (many) seats on it. If a flight is predicted to be nearly empty they'll start selling those seats cheap early on. And those predictions are made half a year or more in advance based on historical data, adjusted over time as departure comes closer.
    – jwenting
    Commented Oct 3, 2014 at 11:21
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    These decision are all different per company. You can't say for sure how these decisions are made. What's true for company X will not be true for company Y. Any attempt to make sense of it (unless you actually work for the company?) will be guessing at best.
    – user9533
    Commented Oct 3, 2014 at 13:04
  • While the exact formula used to determine initial seat allotments and subsequent adjustments to that count vary a bit from airline to airline, most every carrier uses the basic concept explained. If you reject an answer because 110% of airlines, hotels or whatever don't follow the exact answer, then it will be impossible to answer any question here.
    – user13044
    Commented Oct 4, 2014 at 2:01

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