SH1651

Airfare Calculation & Airline Ticketing

(Versoza, 2016)

I. Principles of Airfare Calculation

A. Factors affecting Airfare

• Base Fare – In order to explain base fair, it is important to know that Travel
Management Companies (TMCs) and travel agencies see rates being calculated in
four (4) ways. First, rates sheets are distributed to them by the respective airlines.
Second, it is based on the passenger air tariff (PAT), which has a set fare based on a
two-book set of Western and Eastern Hemisphere. Third, the global distribution
system, fare quotation display (FQD) has a specific set of rates given, and lastly,
through the airline’s rate desk which provides quick air fare calculation.

• Taxes and Airport Fees – Airlines pay taxes and airport fees too. When an airline
takes off or lands on an airport and uses its facilities, it is charged with corresponding
takeoff or landing fee. When it parks and disembarks its passengers, it has to pay
parking fee as well.

• Fuel Surcharge – Different airlines use different equipment. Some use turbojets for
their flights like the Airbuses and Boeing series aircrafts. These aircrafts are normally
used for long flights. Other airlines use smaller aircrafts like the turboprops (aircrafts
with a turbine engine that drives an aircraft propeller. In contrast to a turbojet, the
engine’s exhaust gases do not contain enough energy to create significant thrust, since
almost all of the engine’s power is used to drive the propeller. Since destinations and
flights vary in length of flying time, evidently, those flights which are considered
long-haul require more fuel for the aircraft. Therefore, this affects the fare calculation.
In essence, surcharge means an additional payment or payment.

• Service Fees – All airlines belong to the service industry. All service-providers
require front liners to man the aircraft that will take care of the passengers on board
or on ground. Different sets of manpower are employed to take care of them. At the
airport, for instance, ground personnel facilitate their trips. They are assisted, checked
– in and brought to the aircraft. Furthermore, flight attendants serve passengers in
flight and take care of their needs. Competent pilots bring them to their destination.
The number of crew inside the aircraft varies depending on the size of the equipment.
All these and much more are part of the service fees that passengers pay for.

• Meals and Snacks – Airfare is also affected if food is served during the flight.
Normally, long-haul flights offer food service to passengers. Long-haul flights are
transpacific flights like flights from Manila to the United States or Europe, which
takes about 10 to 16 hours of flight. Most transpacific flights are considered full-
service flights. These are flights which offer food, beverage, and other amenities in
flights. Everything is included in the airfare. In contrast to these flights are called
“low-cost flights”. Examples of these low-cost flights are flights are the ones being

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offered by Cebu Pacific and Air Asia. These are called budget flights where food and
beverage are not provided but sold during the flight.

• Baggage – Travelers normally travel with checked-in baggage except if they are
travel-light passengers. For passengers who travel using full-service airlines, they are
given baggage allowance stipulated in their tickets. Some give 15-20 kilos baggage
allowance per passenger. However, for low-cost carriers, travelers have to pay for
their baggage allotment. This allocation is one of the reasons why airfare calculations
change.

• Seat Selection

First Class offers the best service in terms of amenities, seat provisions, food
choices, and priorities.

Business Class is found mostly on international routes and planes that are
configured for long-haul travel.

Economy Class is also called as coach class or standard class, which is least
expensive air seats a passenger can avail of when traveling via air.

B. Passenger Air Tariff (PAT)

• Headline/Sideline Cities – both are indicated in the PAT and typed in all capitals.
The headline is typed in bold while the other one is just in capitals
• Fares – round trip fares are typed in bold while one-way fare is not.
• Fare Type – may be referred to as the class of service the passenger wants to be in.
 Y is the code for Economy Class
 J for Business Class
 F for First Class
• Carrier Code – airlines are given by IATA a two-letter or one-number and one-letter
code.
 PR for Philippine Airlines
 AA for American Airlines
 5J for Cebu Pacific
• Maximum Permitted Mileage (MPM) – shown from the point of Headline city to
Sideline city.
• Global Indicator – the global routing direction shown that is applicable to the fare.
 DO – Domestic
 EH – Eastern Hemisphere
 WH – Western Hemisphere
 EU – Via Europe
 Pac – Via Pacific
 RW – Round the world
 ME – Middle East
 AT – Across Atlantic
• Rule – refers to the applicable fare rule.
• Neutral Units of Construction (NUC) – equivalent to local currency fare.
• Local Currency – fare is given based on the local currency of the headline city.
• Route Reference – the numeric reference to linear outing.

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II. Airline Ticketing

 Airline Ticket – A document, issued by an airline or a travel agency, to confirm

that a traveler has purchased a seat on a flight on an aircraft.

Picture 1. Traditional airline ticket coupon (www.thebestworldairlines.blogspot.com, 2016)

A. Details Found in an Airline Ticket Coupon

Issuing airline
Restrictions (non-endorsable, non-

refundable)

Date of issue
Passenger’s name

Point of origin (city which is the start
Point of destination (city or place where
of the trip) passenger will disembark or get off)

Return flight (back to the destination)
Airline code (PR for Philippine Airlines)

Flight number
Business class

Travel date (date of departure)
Time of departure

Status (Ok means ‘confirmed’)
Origin/Destination

Issuing office/Travel agency and the
Date when ticket is not valid to be used
date and place of issue before the flight

Date when ticket is not valid to be used
Baggage allowance
after the flight

Fare
Fare Basis (alpha-numeric code that
identifies the fare)

Form of payment
Control number

Ticket number (form and serial
number)

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B. Electronic Airline Ticket (E-Ticket)

Advantages of E-Tickets
1. E-tickets data are stored in a computer database network. Therefore it can always be
retrieved anytime and anywhere. Even if a passenger loses his ticket, s/he can always print
it. With paper tickets – once it is lost, the airline may charge for a new print out.
2. E-tickets do not use more paper than the regular paper tickets. Therefore, it is cost-effective
for both airline and passenger. At times, a passenger does not even have to print it. In the
Philippines, some airlines allow passengers to just show a copy of their itinerary flight
coupons via their cellphones or tablets. It is important to mention that e-tickets support the
environmentally-friendly endeavors being implemented to save Mother Nature, as it saves
trees as well.
3. E-tickets also provide an assurance of choosing a seat, travel time options, and other
flexibilities. After the sale, airlines can more easily track down passengers to inform them
of itinerary adjustments, cancellations, and other last-minute changes.

Disadvantages of E-Tickets
1. In the case that an airline system crashes, which is a possibility, a passenger’s reservation
and other information can disappear.
2. Even with its much-improved efficiency, e-ticketing also could make some jobs, such as
those at travel agencies and airline reservations desks, obsolete, adding to unemployment.
3. With world conflicts and security a constant issue, some experts argue e-tickets and the
procedures associated with purchasing and using them make it harder to detect risks.

REFERENCES:
Versoza, R. F. (2016). Travel services. Phoenix Publishing House.

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