Have you tried to book a flight to Phoenix lately? You might have noticed the tickets are quite pricey.
But why are flights to Phoenix so expensive? Don’t worry; you’re not the only one wondering why.
In this post, we’ll look at eight simple reasons why flying to Phoenix costs so much. Whether you visit Phoenix often or are planning your first trip, knowing these reasons can help you understand why tickets cost what they do.
Let’s explore why flying to this sunny city might cost more than you expected.
8 Why Are Flights to Phoenix So Expensive
Reason # 1: High Passenger Demand
Phoenix has recently seen a significant increase in passenger demand, which is pushing up flight prices. In May 2024, Phoenix Sky Harbor International Airport handled 4.7 million passengers, marking a 12.6% rise from the previous year. This spike is largely due to new nonstop international flights and a boost in international travel.
The airport’s international travel has surged as well. In the first four months of 2024, there were 12.6% more international travelers compared to the same period in 2023, and a 25% increase from 2019. This growing interest shows that more people are choosing Phoenix as their travel destination.
From January to April, nearly 17.7 million passengers passed through Sky Harbor, a 6.7% increase from the previous year and a 25% jump from 2014. This high traffic highlights Phoenix’s strong appeal and popularity.
To keep up with this demand, Phoenix is planning to build a new terminal, which is expected to be finished by the late 2030s. This new facility will help manage the increasing number of travelers and improve the airport experience. The high demand means airlines adjust their fares to match the busy travel periods, leading to higher ticket prices.
Reason # 2: Limited Airline Competition
Phoenix Sky Harbor International Airport has high flight prices partly because there is limited airline competition. Currently, two major airlines, American Airlines and Southwest Airlines, serve the airport and together account for over 80% of all passenger traffic. This means that travelers have few choices when flying to and from Phoenix.
With only a small number of airlines operating, there is less competition to lower ticket prices. Routes with just one or two airlines often have higher fares because there are fewer alternatives for passengers. This limited choice keeps prices elevated since the airlines face less pressure to offer competitive rates.
The airport’s policy also affects competition for ancillary services, such as extra baggage fees and seat selections. Since there are not many airlines to choose from, it is harder for passengers to find better deals or lower prices on these add-ons.
Attempts to boost competition, such as new airline recruitment and redevelopment plans, have not yet led to significant changes in pricing. Additionally, the airport’s curfew system limits the number of flights and can prevent new airlines from entering the market. As a result, the lack of competition continues to keep flight prices higher for travelers at Phoenix Sky Harbor.
Reason # 3: Airport Infrastructure and Fees
The costs of maintaining and upgrading Phoenix Sky Harbor International Airport significantly affect flight prices. The airport is currently investing heavily to meet increasing passenger demand and enhance its facilities.
A major upcoming project is a new terminal, which will be constructed on the west side of the airport, starting after 2030. This new terminal will replace the old Terminals 1 and 2, which have already been removed.
The airport is also working on a $2 billion, 20-year plan. This plan includes building a new north/south taxiway to improve efficiency, adding a new concourse at Terminal 3, and creating a walkway between Terminals 3 and 4 to make connections easier.
Terminal 3 has recently been upgraded with a better layout, a larger security area, and 31 new ticket counters. A new eight-gate concourse at Terminal 4, which cost $310 million, will offer more space and better amenities for Southwest Airlines passengers.
These projects are funded through grants, airport revenues, and bonds, with no local tax money used. Passenger Facility Charges (PFCs), currently at $4.50 per passenger, help pay for these improvements. The high costs of maintaining and developing the airport, along with these fees, contribute to the overall higher price of flights to Phoenix.
Reason # 4: High Operational Costs
Airlines deal with high operational costs that make flights to Phoenix more expensive. These costs include fuel, maintenance, and airport fees.
Phoenix Sky Harbor International Airport has some of the highest landing fees in the U.S. These fees have been rising by 5% each year since 2020. This makes flights more expensive as airlines pass these fees onto passengers. High landing fees directly increase ticket prices.
The extreme summer heat in Phoenix forces airlines to carry fewer passengers or less cargo to stay safe, which limits revenue and raises costs. This extra cost is added to the price of tickets.
The desert environment also requires more frequent aircraft maintenance due to sand and dust, which increases maintenance costs. The airport’s complex layout means planes take longer to taxi, using more fuel and increasing turnaround times.
Electricity costs at the airport are about 30% higher than the national average, adding to operational expenses. Labor costs are also high, with wages for ground crew 15% above the national average.
Additionally, operating long flights to distant places like Asia can cost airlines over $100 million a year. All these factors contribute to higher airfare for flights to Phoenix.
Reason # 5: Labor Costs
Labor costs significantly affect the price of flights to Phoenix. Airlines need to pay competitive wages and benefits to pilots, cabin crew, and ground staff, which are included in ticket prices.
At Phoenix Sky Harbor International Airport, labor costs are higher than average. Ground crew wages at PHX are about 15% above the national average, which increases the overall cost for airlines. These higher costs are then passed on to passengers in the form of higher ticket prices.
In 2022, there were 56,421 jobs directly at the airport, with total labor income amounting to $3.9 billion. The majority of these jobs are in the private sector, with only 5.7% in government positions. This large number of high-paying jobs contributes to the overall higher cost structure.
The Aviation Department employed around 890 full-time workers at the end of 2022, a figure that has remained steady over recent years. Additionally, the airport has about 150 contracts with regional companies, with a total value of $107.2 million, further reflecting the high cost of operations.
Employment in the airport’s industrial area also adds to labor costs. With 1,843 workers generating $1.1 billion in direct output, this sector further increases operational expenses. The airport supports its workforce with programs like the Childcare Scholarship Program, helping employees manage childcare costs.
All these factors contribute to the higher labor costs in Phoenix, which in turn lead to more expensive flights.
Reason # 6: Geographical Disadvantages
Phoenix Sky Harbor International Airport faces several geographical challenges that make flights more expensive.
PHX is close to larger airports like Los Angeles International Airport (LAX) and Dallas/Fort Worth International Airport (DFW). These bigger airports handle many more international flights, making it harder for PHX to attract similar services.
Flights from Phoenix to international destinations are long, often taking 9 to 11 hours. This long distance can make these routes less appealing to airlines, leading to fewer international flight options.
Phoenix is often associated with Las Vegas when people think about visiting the Grand Canyon. This can limit Phoenix’s attractiveness as a gateway for international visitors.
The airport also has limited infrastructure for international flights. There are only two gates at Terminal 4 that can handle large international planes. This lack of facilities restricts the number of international flights PHX can accommodate.
The desert environment adds extra costs. The extreme heat and dust cause more wear and tear on aircraft, leading to higher maintenance costs for airlines.
Finally, Phoenix serves a smaller population compared to major airports like LAX, which covers a much larger area. This smaller market makes it less attractive for airlines to offer a wide range of international routes.
These geographical challenges contribute to the higher cost of flights from Phoenix Sky Harbor.
Reason # 7: Consumer Behavior
Consumer behavior plays a big role in the cost of flights to Phoenix. How and when people book their flights can significantly affect prices.
Phoenix Sky Harbor International Airport (PHX) has implemented the PHX Reserve program, which lets passengers book a time slot for TSA security in advance. This system helps manage peak travel times and improves the passenger experience. The program also aims to make travel more predictable, though it might influence overall ticket prices.
Airlines often raise prices for flights booked last minute or during busy times because they know demand is high. If travelers are willing to pay more for convenience or better services, airlines adjust their prices accordingly. For example, flights during holidays or major events tend to cost more.
PHX also integrates local businesses and amenities, such as new restaurants and shops, to enhance the travel experience. This can make the airport more appealing but might contribute to higher costs.
In essence, how people book, and their preferences can drive up prices, making flights to Phoenix more expensive during peak times or for premium options.
Reason # 8: Lack of International Infrastructure
Phoenix Sky Harbor International Airport (PHX) struggles with limited international infrastructure, which drives up flight costs. The airport has only two international gates at Terminal 4 for large aircraft, restricting the number of international flights it can handle. Terminal 3, which mainly deals with domestic and pre-cleared international arrivals, lacks the capacity for a major increase in international flights.
This scarcity of international facilities results in fewer flight options and less competition among airlines, leading to higher ticket prices. The limited infrastructure means travelers face higher costs due to fewer available routes and less flexibility in scheduling.
PHX is working on improvements, like upgrading the central utility plant and planning new projects to boost capacity. A recent $36 million federal grant will help modernize facilities, and new laws will support infrastructure expansion. Despite these efforts, the current lack of extensive international infrastructure contributes to higher operational costs, which are often passed on to passengers.
Conclusion:
In conclusion, flights to Phoenix are pricey for several reasons. Many people want to visit, but there aren’t many airlines flying there. The airport is spending a lot of money on improvements, which adds to the cost. Phoenix’s location and weather also make flights more expensive. Workers at the airport get paid more, which increases prices too. When lots of people book flights at the same time, like during holidays, prices go up even more.
If you want to visit Phoenix, try to book your flight early and be flexible with your travel dates. Look for special deals from airlines. Even though flights cost more, Phoenix has many fun things to see and do that make it worth the trip.
Don’t let flight prices stop you from enjoying Phoenix! Start searching for deals today and make your desert adventure a reality!
