Why are transcon flights so cheap?
 

I know this is probably basic airline economics, but...

I live in NYC and enjoy flying to LAX/SFO for work and for leisure. I hope to make the round trip four times this year. Why are these flights often sub $450 when it costs me comparable amounts to fly from LGA to or JFK to much closer destinations (FLL, MIA, MSP, LAS, etc)?

If it is just more capacity on these routes, why do so many airlines find these routes attractive? Are carriers like UA, DL and VX making money on these routes selling filling up coach seats at sub $450?

more competition, better fuel efficiency are some reasons

They aren't making the bulk of their money on this route with the sub $450 people - they're making it on the people paying to sit in J and F upfront (hollywood crowd and business execs). It's one of the few routes in the US that supports paid J and F which is why you find that the competition isn't so much about the back of the plane but it's about what's being offered in the front

Take a look at paid J for the summer months with the exception of B6, it looks like J fares at the moment are at or over 4k for JFKLAX RT

This route can be one of the most difficult to clear as an EXP (and on DL and UA they require the use of instruments or miles + cash to upgrade - there are no complimentary upgrades on the route for those two)

Many flight costs are not directly tied with distance. Landing fees, the cost of supporting the plane on the ground, the cost of all the collateral business operating costs (booking, etc.) all are independent of the length of flight. In addition, the most costly portions of a flight are the take off and landing, not the time spent flying midair.

Transcons represent pretty much the longest flights you can take in the US (baring to Alaska or Hawaii), so you notice the effect the most. From Boston, we have some pretty good fares when based on CPM, especially to the North West and Florida, where you also factor in competition.

However, when you compare that to other options, AND factor in things such as seat comfort, limitations on movement, luggage, etc, you find it really isn't that great. The trade off is that flying provides the only currently available option that can get you there in a reasonable amount of time. IIf you were to run the rail lines like you do airlines, I bet you would find that airfares look terribly expensive.

yep
 

Cloudship is pretty much spot on and covers almost all aspects.

Just so you have some comparison:
When I was at the UA Premier tour operations in Vegas we were told that the fuel cost itself is approximately $30,000 for a LAS-NYC flight...

1) Larger populations on both ends
2) Richer people on both ends willing to pay for premium cabins
3) International connections on both ends

Several years ago AA was running a promo (for about one month), if you took two rt flts. from the east coast to either lax or sfo you got one rt on an AA plane to anywhere they flew in the world.
I took advantage of an (error?) pricing jfk-sfo-jfk for $137 rt + jfk-lax-jfk for $200.
I doubt they will have such a deal ever again.:td::D

Flights are not priced based on distance; they are priced based on the markets they serve. Two big cities with plenty of competition typically have a low price. A small town in the middle of nowhere only served by one airline is going to have outrageous fares instead. Supply / demand.

How far in advance are you buying tickets? I've been averaging roughly $1,200 for transcons for 2-3 days notice and $1,000 on the rare occasions that I have 4-5 days notice, all in whY. I haven't paid $450 for a transcon in 10 years.

I book travel as far in advance in possible, even business travel. I already have all of my planned leisure travel booked through 1Q15, and I have business trips booked as far out as October. For business trips, I may book close in if necessary, but I don't really notice those prices that much.

For example, I am looking at both award and revenue flights for SF in August. $420 on Virgin, $460 or so for Delta and United.

You have competition with multiple carriers on this route. Jetblue, Virgin America, Delta, United and American Airlines. American Airlines cut back on capacity and prices have increased on those flights but other airlines still have capacity available.

As to why it is cheaper than other shorter routes is because of less competition. First class in AA transcontinental is the best offering on this route and there are only a few of those seats available for the customers with more money to spend. Jetblue also has business class on it's transcontinental flights on the same A321 as well to go for the higher margin customers.