Transportation Economic Trends
Cost of Transportation:
Costs Faced by Households
Households pay for travel in two ways, either by paying to own and operate passenger vehicles for their own use, or they pay fares to use for-hire passenger transportation services (e.g., air, transit bus, and rail services) for their intercity and intracity travel. For total household expenditures on transportation see Household Spending on Transportation.
2021 and 2022 Year-in-Review
- On average, consumers faced higher transportation costs in 2022 than in 2021 (a 15.5 percent increase). Private transportation costs increased by 15.5 percent in 2022, bringing private transportation to a new all-time high. Public transportation increased by 19.9 percent in 2022, bringing it to its second-highest level - 0.6 percent below the all-time high reached in 2013.
- Within private transportation, the cost of other motor fuels increased the most at 53.4 percent in 2022 followed by gasoline (all types) at 36.0 percent and tires at 13.6 percent.
- Transportation fares decreased in real dollars in 2020 when the demand for public transportation declined due to uncertainty about COVID-19 and stay-at-home orders but remained above the lowest fares. Domestic airfare (scheduled service) and transit fares continued to decrease in real dollars in 2021, by 12.0 percent and 6.0 percent, respectively. In contrast, the average Amtrak and commuter rail fares increased, in real dollars, by 3.0 percent and 3.8 percent, respectively, in 2021.
Costs Faced by Households
The Consumer Price Index (CPI) measures transportation costs from the households’ (also known as consumers’) perspective. The CPI is a measure of the average change over time in the prices paid by urban consumers for a market basket of goods and services. The CPI also includes user fees (e.g., water and sewer service) and sales and excise taxes paid by the consumer. Economists often use the CPI as an indicator of general price trends. CPIs for goods and services, such as ones related to transportation, show changes in prices for those goods and services.
The CPI provides a picture of the relative change in the price households pay for transportation. Fare data, shown below, and fuel data reflect the actual price paid.
The relative change in the price households pay for public (e.g., airfare and transit) versus private transportation (e.g., motor fuel) at times diverge, with significant differences across items.
Airfare reflect both the cost of fuel and competition among carriers. Airfare, shown below, does not include baggage or reservation fees, which airlines began to charge in 2008.
Intercity railroad fares
Amtrak intercity railroad fares represent a complex interaction of demand, operating costs, government subsidies, and regulation.
Commuter railroad fares
Commuter rail includes railway passenger service that operates between a central city and adjacent suburbs. It excludes intercity rail service, such as Amtrak, except for the part of service operated by or under contract with a public transit agency for predominantly commuter services. “Predominantly commuter service” means that, for any given trip segment between two stations, more than 50 percent of the average daily ridership makes a return trip on the same day. Commuter rail does not include heavy rail transit or light rail/streetcar transit service.
For the years 1995 to 2001, BTS calculates average transit fare per trip as total passenger fares by total passenger trips collected by the American Public Transportation Association. For the years since 2001, data come from the National Transit Database, which presents average transit fares per unlinked trip. This means that if a passenger takes a bus with a fare of $1 and transfers to a subway with a fare of $2, the journey would count as two unlinked trips with an average fare of $1.50.
U.S. Department of Transportation, Bureau of Transportation Statistics, Transportation Economic Trends (Washington, DC: 2022).