Transportation II: Airline Fares and Ticketing: Types of Air Journey, the Mileage System (MPM, TPM, the Extra Mileage Allowance and Surcharge), the Higher Intermediate Fare Check, Add-on, Open-Jaw and Excursion Fares, NUC and ROE, the International Air Ticket, the Distribution of Ticket Sales, MCO, MPD and EMD, the Billing and Settlement Plan, and Air Charters

A journey is broken into fare components, the portions between two consecutive fare construction points, each priced separately. A stopover is a deliberate break of journey at an intermediate point, normally of more than 24 hours on an international journey; a transfer or connection is a shorter stop to change flights. Whether an intermediate point is a stopover matters, because fare rules limit stopovers and because intermediate points where the passenger stops over are the ones checked for a higher fare.

A published fare between two cities allows the passenger some freedom of routing, and the mileage system sets how much. The Maximum Permitted Mileage (MPM) is the maximum distance a passenger may travel between two fare construction points for the published fare between them; it is published with the fare and is usually about 20 per cent more than the direct distance. The Ticketed Point Mileage (TPM) is the published distance between each pair of consecutive ticketed points on the actual route. To check a routing, the TPMs of the fare component are added. If the total does not exceed the MPM, the published through fare applies. An Extra Mileage Allowance (EMA) is a fixed deduction that IATA allows from the TPM total when the journey travels via certain specified points, so that recognised routings are not penalised; it is applied before the comparison with the MPM.

If the TPM total, after any EMA, exceeds the MPM, the fare is raised by an Excess Mileage Surcharge (EMS). The excess is expressed as a percentage of the MPM and rounded up to the next band of 5 per cent: 5M, 10M, 15M, 20M or 25M, meaning the fare is increased by 5, 10, 15, 20 or 25 per cent. If the excess is more than 25 per cent, no surcharge can be applied and the fare must be constructed differently, by breaking the journey into more fare components at an intermediate point. Worked example: the MPM between A and C is 5,000 miles and the routing A–B–C has TPMs of 2,300 and 3,050, a total of 5,350. The excess is 350 miles, which is 350 ÷ 5,000 = 7 per cent, rounded up to the 10M band. A published fare of NUC 800 becomes 800 × 1.10 = NUC 880. Had the total been 5,240 miles (4.8 per cent over), the band would be 5M.

The Higher Intermediate Fare (HIF) check, also called the higher intermediate point (HIP) check, protects the fare structure against routings that would undercut it. If, within a fare component, the fare from the origin to an intermediate ticketed point where the passenger stops over (or between two such points) is higher than the fare from the origin to the destination of the component, the higher fare must be charged for the component. Example: the fare A–C is NUC 900; the passenger travels A–B–C with a stopover at B, and the fare A–B is NUC 1,000. The component is charged NUC 1,000, not 900, and any mileage surcharge is then applied to the higher fare.

Worked example of construction: the component fare after the mileage check is NUC 880. If the IATA rate of exchange for Indian rupees were 83.5, the fare would be 880 × 83.5 = ₹73,480, before the rounding rule and before taxes, fees and carrier charges are added. The fare calculation box on the ticket records the whole construction: the cities, carriers, NUC amounts, mileage surcharges, the NUC total, the ROE and the local-currency fare.

The paper ticket, with a flight coupon for each sector, ended when IATA's member airlines moved to 100 per cent electronic ticketing on 1 June 2008; the e-ticket record is held in the airline's database and the passenger carries an itinerary receipt. Airline tickets are sold directly, through the airline's website and app, call centres, city ticket offices and airport counters, and indirectly, through IATA-accredited travel agents, online travel agencies, consolidators who buy in bulk at net fares, and general sales agents who represent foreign airlines in a market. Most indirect sales pass through a GDS, and the agent's sales are settled through the BSP. Airlines have moved from paying agents a commission towards net fares and service fees, and they promote direct booking to cut distribution costs.

The Miscellaneous Charges Order (MCO) was an accountable document issued by an airline or agent to request the issue of a ticket or to cover charges other than a passenger ticket, such as excess baggage, a deposit, a penalty, a refund balance or ground arrangements. The Multiple Purpose Document (MPD) was the version issued by travel agents, with coupons for several such purposes. Both belonged to the paper era, and with electronic ticketing they have been replaced by the Electronic Miscellaneous Document (EMD), issued either associated with a ticket (for a paid seat or extra bag) or standalone (for a fee or deposit). The Billing and Settlement Plan (BSP), run by IATA, simplifies the money side of agency sales: instead of each agent settling separately with each airline, agents report all their sales for a period to the BSP, which bills each agent a single amount, collects it through a clearing bank and pays each airline what it is owed. BSP India serves IATA agents across the country. In the United States a separate body, the Airlines Reporting Corporation, performs this role.

An air charter is the hire of a whole aircraft, or part of its capacity, by a charterer for a particular flight or series of flights, outside the airline's published schedule. Types include the full charter; the part or split charter, in which several charterers share an aircraft; the ad hoc charter for a single event; the series charter, a regular programme through a season, used by tour operators for inclusive tour charters to holiday destinations such as Goa; and executive or air-taxi charters of small aircraft. Charters are priced per flight or per block of seats rather than per passenger, which suits tour operators who fill the aircraft, and in India they are operated by holders of non-scheduled operator permits or by scheduled airlines, with foreign tourist charters subject to the government's charter guidelines.