Believe it or not, flights are getting cheaper. Airfares fell 1.8% from May to June. Fares were one of the few categories to decline at a time when consumer prices rose at the fastest clip in more than four decades. The surge in spring and summer travel — even at sky-high prices — has been a boon to airlines, driving revenue above 2019 levels even as airlines fly less than they did before the pandemic.
High-price freight contracts that were written when carrier capacity was tight and a rush to restock inventories was in full force are losing their shine as slowing demand sends shipping rates sliding. Some companies now are renegotiating shipping agreements they struck at the height of the pandemic-driven surge in freight demand. The situation is a sharp turnaround for shippers who at the start of 2022 were willing to pay record-high contract rates to guarantee space on container ships.
