Why do airlines charge more for group tickets than single tickets?

Why is group air fare sometimes more expensive than a single ticket?  It seems like I should get a discount for purchasing 20 tickets, not pay more.

image of seats inside an airplaneThe bin system most airlines and trains use is very complicated.  As a consumer, there are normally up to 6 adult tickets available for purchase at a single time.  This is one very likely reason that a group leader will and should consult a travel planner.  The agent will have access to unlimited numbers of available seats at the best available rates.

First, let me explain the ticketing system.  It is similar for flights and trains with a few differences.  In general, all available tickets on a flight are divided up into bins.  These bins will contain a number of tickets between 2 and 50 seats.  It depends on the size of the aircraft and expected sales.

Each bin has tickets available at a different price.  For instance, a really great sale “limited tickets available at $59” may be in a bin with just 4 tickets. Then next bin may hold tickets that are priced at $129 and the next at $179.  They will continue to increase in price until full price first class seats are listed.  Some bins may be more money but offer a different value, such as with Delta Economy Comfort seating. Comfort passengers receive extra leg room, more recline, early boarding and more.  Complimentary beer wine and spirits, a sleep kit, premium entertainment and a pillow and blanket may also be included.

When a consumer shops for one ticket, the lowest priced bin may be shown.  However, if more tickets are needed, the next higher bin with that number of tickets will be offered.  Often, once a consumer presses that purchase button, the ticket is removed from the bin.  If the purchase isn’t completed, sometimes the ticket is then placed in a totally different bin (one with a higher price).  This is the reason that consumers see prices jumping around so much when doing multiple searches.

Another consideration is that the fare shown is often without the ticketing or processing fee charged by online ticket sellers, so the buyer won’t necessarily know the final price until they press purchase and work their way toward the checkout.  At that time, if the purchase isn’t completed, the tickets could drop back into a new bin.

While some travel agents don’t sell air tickets because of the complexities, others, like myself take the guess work out of the process by purchasing single or multiple tickets.

Back to group air, when a travel planner is asked to purchase a block of seats to a destination, this is generally done directly with the airline which means the very best possible price for that number of tickets becomes available to the consumer through the agent.  There are also a number of benefits involved with purchasing through the agent.

While each contract varies slightly, many group air contracts require a $100 per person deposit to hold the tickets until 60-90 days prior to travel when the final guest list is required and payment in full is needed.  Unlike individual purchases, where the exact traveler name and date of birth is needed, there is room within a group to make changes in the event that one traveler changes plans.

Deviations for a number of guests, such as a few people who want to stay longer or return via an overnight layover, are often available within the contract. Group size can often be decreased by about 10% and cancellations are sometimes allowed with a fee.

The extra set of eyes checking for the best flight pairs and the guest list often catch slight errors.  These errors would add up to large fines and fees if not caught.  The agent will also likely be able to recommend visas, airport transportation, transfers, travel insurance and any other items that will insure a transparent and worry free vacation for the group leader as well as the group.