You’ve got 1,000 miles between you and your destination. Would you rather spend $61.86 or $163.07 to get there? In 2000, when gas was only $1.53 on average throughout the US (according to U.S. Energy Information Administration), the $61.86 could have been possible. Now, with the annual gas average hovering around the $4-$5 range, you can bet on spending around $160-$170, and don’t forget about the way back home, which doubles the gas expense.
Don’t worry; airfare roundtrip is also currently more than $300, especially when you take into account nonstop vs. indirect flights. The biggest factors are jet fuel & oil cost, seasonality, supply & demand, and location. After the pandemic, there is also a pilot shortage, which results in fewer flights. To combat this, airlines have heightened the wage for pilots, but we will still see that supply and demand shift with fewer pilots and fewer flights.
Looking at the consumer price index over the years, in 2000, airfare had an average of $239.425 according to FRED, while in 2022 so far, the annual CPI is at $265.99. This isn’t including June’s CPI so far, which is at $330.
Table of Contents
- Is Your Time Worth Less?
- Is Your Life Worth More?
- The Cost of Driving
- Why Would You Want to Drive?
- The Cost of Flying
- Comparing Price Statistics in Detail
- What Are the Different Ways to Save?
- Contributing Factors & Variables
- So, What Will You Choose?
Is Your Time Worth Less?
The average hourly wage for the United States as of May 2022 is $31.95 for all nonfarm payrolls. Let’s say you were able to take off work to take a 1000-mile trip. If you were to drive there, it would take approximately 16.667 hours of driving. That’s 16.667 hours that you could have been making $31.95 per hour, which totals to $532.50 that you lost out on when you could have been working.
If you were to fly there, the average time it takes to fly 1,000 miles is about 2 hours and 28 minutes. When you determine your earnings for those 2 hours and 28 minutes, you only lost out on $72.85 of income. $72.85 in comparison to $532.50 already sounds like a significant difference, and that’s only focusing on the worth of your time.
Adding in the gas price and airfare makes the total travel cost of driving (time and fuel cost) to be $712.24 and the total travel cost (time and airfare) of flying to be $411.15.
Is Your Life Worth More?
Did you know that one of the leading causes of death in the United States is car-related incidents? In fact, more than 40,000 people die annually on the roads of the United States. Between distracted driving, impaired driving, aggressive driving, and bad weather — it’s no surprise that driving can be dangerous. In the most recent statistics from the National Highway Traffic Safety Administration, there were around 6,756,000 police-reported traffic incidents, leaving 39,096 people killed in just one year.
When it comes to aviation, major airlines don’t have many fatalities. In fact, in 2020, according to National Safety Council, there was a fatal accident rate of 0.0 per 100,000 flight hours, which in comparison to 40,000+ annually, is drastically different. When we get down to Commuter Airlines – which has a maximum capacity of 75 – we saw a slight jump of around 2-5 fatalities within the years 2019 and 2020 — still nowhere near the car crash fatalities. This could be because of the intense training that pilots have to go to, along with the air traffic control systems in place, and constant maintenance of airplanes.
The Cost of Driving
When it comes to travel, the huge debate about driving vs flying always relies on one main factor: the cost. With gas prices increasing drastically over the past year, we see this more lately than ever.
In fact, looking at the year 2000, the average price of gasoline landed at around 1.5 US dollars. The average price of gasoline in 2020 was 2.1 US dollars, and the average price annual to date in 2022 so far is 4.19 US dollars. In 20 years, from 2000 to 2020, the gasoline prices didn’t even double in average annual pricing. In just 2 years, from 2020 to 2022, gas prices dramatically increased to double the annual average pricing.
Taking Car Ownership into Consideration
A huge expense that many people don’t take into consideration when determining whether to fly vs. drive is the cost of ownership. The average cost of owning an automobile per 15,000 miles in 2018 was $8,849. The following year was $9,282. The year after that (2020) was $9,561. Cars can be a lot to maintain, and, on average, the value of a car decreases significantly as the years move forward.
From fixing bad breaks to mending broken windshields, significant damage can happen to cars when taken for a drive. These damages can be quite costly, especially if the driver doesn’t have car insurance. These maintenance costs should be included in the budget for taking a car on a vacation, whether it is upfront costs or costs to help repair small deterioration over long drives and frequent road trips.
Depreciation of a Car
To calculate the depreciation of the vehicle you plan on using for travel, take the car’s current market value from the purchase price (without sales tax and fees). That number can determine how much value the car has lost since you originally bought it. Though cars are a vital resource and form of transportation, due to the annual wear and tear, this is how cars quickly lose their value.
The higher miles a car has on it also determines the lessened value of the car because high mileage cars tend to need necessities fixed like tires and service fees.
Why Would You Want to Drive?
Opportunities & Convenience
When driving, there are more opportunities to stop along the way. Road trip attractions from Cadillac Ranch and Mount Rushmore to the Grand Canyon and the Enchanted Highway are just a few that stand out on the road trip bucket list. Between these side shows attractions and the ability to stop the car when you want to get out and stretch, it’s not hard to see why people like to drive more than fly.
There’s also something about control and convenience. In an airplane, travelers typically aren’t flying the plane, thus creating a feeling of a lack of control. Between TSA and security causing stressful experiences as well as the length of ticket lines and checked bag lanes, an airport is overwhelming enough to give travelers anxiety. When driving, however, travelers take control of their overall experience. They control the wheel, how quickly they get somewhere, the ac, the windows, and other small things that wouldn’t normally bother those who love to fly.
The Cost of Flying
Are Airfare Tickets Really That Expensive?
If you’re a traveler who is wondering why everything is so expensive, then you’ve come to the right place. Here, we will break down exactly what goes into the airfare cost that you’re seeing and how to avoid breaking the bank when you choose an airplane as your main form of transportation.
Jet Fuel Prices
Although frequent travelers may not think about it often, jet fuel is a huge determining factor for whether or not airfare is expensive. Jet fuel is one of the largest expenses annually, and while some airlines choose to hedge the cost of Jet fuel, others do end up paying the financial price changes (even at all-time highs). Unfortunately, whether travelers are aware of it or not, these jet fuel prices do change the price of air travel.
Looking for an Upgrade?
Airplane upgrades are a way to experience the high-end aviation experience without the small inconveniences of airport security, uncomfortable seating, and mediocre food. Upgrades can cost as little as that extra $25 for early-bird check-in, to around $70 for TSA precheck, to as much as $5,000 (or more) for premier, first-class seating.
The upgrade for comfortability and food alone could cost thousands of dollars, and while to some… that might be worth it, to others…it definitely is not worth the cost of flying.
Comparing Price Statistics in Detail
Gas and fuel prices alone are contributing to our decision on whether to fly vs. road trip, so what are they when compared side by side? Based on the years 2000 to 2022, they have both aligned with each other closely. From 2000 to 2012, we see a dramatic increase in automobile gas pricing. This is a 12-year gap, so it is completely normal to see the drastic increase of 1.529 to 3.686. With jet fuel, the increase goes from .78 to 3.18, which is also a high increase — but within the realm of over a decade.
It’s when we go into the most recent years that we see abnormal differences. You can see from 2018 to 2019, we see a slight drop in both jet fuel and gas prices. In 2020, COVID was in its prime and we see a significant drop for each because no one was traveling or leaving their homes. That’s why we see a significantly lower price of 1.43 for flight fuel and 2.259 for gas.
Heading into 2021, the economy slowly started getting back on its feet, and this is where we see the prices slowly going back to normal of 3.09 for gas and 1.99 for jet fuel. Finally, for the newer 2022 year, we see gas prices at a high average of 4.021 and jet fuel at 2.91. From 2021 to 2022, that’s a 30% increase in one year for automobile gas prices and a 46% increase for domestic jet fuel.
What Are The Different Ways To Save?
While flights and airports could be quite expensive, there are several ways to save to make it a little more budget-friendly. From apps to find the best prices to reward points systems to something as easy as choosing the right day, there are an abundance of ways to save if you choose flying over driving.
One way airlines offer value to travelers is by offering credit cards and rewards programs to save money, rack up on special perks, and experience overall better travel. Rewards programs vary on the airline, with some airlines offering benefits like air miles to use towards future travel, cabin upgrades, airport lounges, redeemable hotel points, and shopping privileges.
Some of the best airline rewards programs to keep in mind are American Airlines AAdvantage, JetBlue TrueBlue, and United Mileage Plus. From priority check-in, free checked bags, and no cancellation fees to dedicated customer service lines, preferred seating, and priority travel services — these three rewards programs are all great suggestions when it comes to travel credit cards and rewards programs.
Choosing the Right Days
Not only are there travel apps like Hopper to help you determine the cheapest flight dates for your destination, but there are also general rules when it comes to picking out a flight. Depending on your location, it can be as simple as choosing a day of the week to arrive and depart. Generally speaking, for business locations, it’s better to fly out at the tail end of the week or on a weekend. For luxury destinations, it’s better to fly out at the beginning of the week, preferably on a Monday or Tuesday.
Be sure to always check in advance to see if there’s a low fare calendar or cheaper tickets.
Contributing Factors & Variables
Distribution, Production Patterns, and Market
Gasoline and aviation fuels come from petroleum-based liquids & crude oil refineries. How do we get this crude oil? Well, oil is made out of components like hydrogen and carbon. There are wells (specifically, over a million active ones across the U.S.) where we extract the oil from. Some wells naturally bring oil to the surface, while others need a pump to remove the oil from beneath the ground.
After the oil is “lifted” from the ground, it’s stored in tanks and gets ready for transport to the above-mentioned refineries. Automobile gasoline may be mixed with chemicals like fuel ethanol and is then delivered to local gas stations nearby. Of course, local gas stations vary their pricing on wages, labor, location, insurance, state fees, and more. That’s why we see the variation across the United States.
Imports and Exports
In order to understand imports and exports, we’ll look at the meaning of each. Imports are when a foreign country provides us with a good or service and an outflow of cash funds from our country goes to the seller. Exports are the opposite. Exports are when the home country produces a good or service and provides that to a foreign country, intake the outsourced cash flow from the foreign country.
While the U.S. can produce enough oil to meet its own needs, it also imports from various countries around the world. Why? Well, firstly, it’s known that the extraction costs of oils in other countries tend to be cheaper than in the United States. Then, it is important to understand the type of oil that the United States produces itself. The oils that the U.S. produces are lighter than that of the oil that the country gets imported, thus the dependence on imports.
When needed, the U.S. exports oil to foreign countries as well. In fact, the United States exports millions of oil to foreign countries yearly, with March 2022 being the most recent all-time high.
Gas demand and travel demand both affect the rising prices. Supply and demand have always come hand-in-hand. The time-old story of the amount of product available and the number of people with the desire to have it.
In 2020, nobody was able to go on vacations or travel anywhere, even when it came to driving their cars to work. For this time, there was no demand for air travel or car travel, thus creating a drop in prices. The world has slowly been opening back up again, creating an even larger demand. With that increase, as does the price.
Airspace and Route Dynamics
Insider tip most general travelers might not know about: traveling through airspace costs money. How it is calculated and how much it is to travel through the airspace depends on the country. (Flying over the ocean costs an extra fee.) Some countries send invoices, others waive the fees, and others charge as soon as the aircraft lands. These fees are all subject to tax and interest and can vary and change.
For comparison, the overflight fees are extremely similar to tolls paid on the highway when passing through cities. Another added wage not considered when passing through airspace is the wages of air traffic control and navigation.
So, What Will You Choose?
When comparing the two, it really comes down to what the individual traveler wants. Driving, you’re able to do whatever you want on your own time, while flights offer a completely different experience. Flying, you’re able to get more value for your time, and it’s generally going to be less expensive than driving.
Evaluate the numbers and have the necessities to know what your time is worth, the memories you want to make, and the price you’re willing to pay.