Soaring Gas Prices Intensify Touring Challenges for Musicians

Just when Whitney Smith felt she’d finally gotten a handle on touring costs in the post-COVID landscape, skyrocketing fuel prices threw everything back into disarray.

“I feel like we’ve just been starting to get to a place where we’re forecasting what things are going to cost more accurately again,” says Smith, the director of touring for full-service artist management company Alternate Side. “And then with these rising fuel prices, that’s thrown a lot into uncertain territory again, to put it mildly.”

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Since the U.S. and Israel began bombing Iran on Feb. 28, leading the Iranian government to close the Strait of Hormuz — a key shipping route through which roughly 20% of the world’s oil flows — the cost of Brent crude, the global benchmark for oil, has soared to more than $100 a barrel, up from about $70 a barrel prior to the strikes, according to data from the U.S. Energy Information Administration. As a result, fuel prices — including gasoline and diesel, the latter of which is used in buses and trucks critical to live music tours — have risen roughly 50% in the U.S. While minor price variations are normal, the nearly unprecedented increase has forced touring transportation companies to tack on hefty surcharges to account for the ballooning costs. For artists already squeezed by post-COVID touring cost increases, the spike has been yet another hit to their bottom lines.

“Since COVID…the cost of transportation and just touring in general is up a ton,” says Rich Thomson , founder and CEO of Dreamliner Luxury Coaches, whose fleet includes 220 tour buses and 70 trucks. Now, with the surge in fuel prices, “You take a bunch of people that are [already] trying to cut costs and find ways to tour cheaper, and you’re just crushing them.”

According to Nick Weathers , the owner of Egotrips, which has a fleet of 12 tour buses and 35 trucks, his company has been tacking on surcharges of between 25 cents and 35 cents a mile since gas prices shot up. “That can add up on a 15, 20 truck tour,” he says. “Thousands of dollars.” For some touring acts, these increases could mean the difference between making a small profit and no money at all. “I [recently] had someone reach out for a tour bus quote,” Weathers adds. “And I sent the quote back, and the guy just vented…He’s like, ‘If we took this bus, we would make zero money on the tour.’”

Unfortunately for artists who were either already on the road or had already committed to tours when the war broke out, these jacked-up costs will eat into the profits they’d expected to make.

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“We negotiate our contracts with our bus companies months in advance, and our fuel rate is based on average price, and we budget off that price,” says Smith. But there was no way to plan for a spike of this magnitude. “When something like that jumps up so much unexpectedly,” she adds, “you’re just absorbing that cost.”

For artists who have booked fly dates — traveling from date to date by plane as opposed to taking vans or buses — the cost of airfare has also spiked since the war broke out. According to weekly data provided by travel website Kayak.com, the price of a domestic plane ticket on commercial flights has risen 13% since the start of the conflict, while the price of an international ticket has risen 55%. With no end to the war in sight, despite repeated assurances to the contrary, some tour managers are buying tickets extra early in case prices continue to rise. “If you have a one-off fly date for a college show…booking flights as far in advance as we can is the move,” says Peyton Marek , a manager at Challenger Artists (the management division of Mammoth Live) who reps bands including TOLEDO and Post Sex Nachos.

Rising fuel prices extend to other aspects of touring as well — from merch shipping costs to food. One less-obvious effect of the increases has been less reliable timelines for freight shipping — particularly boats, which have been slowing their speeds in order to save on fuel. According to Jason Danter , a production manager who has worked with artists including Lady Gaga and Justin Bieber , that has only added to the unreliability of ocean freight, a cheaper but slower alternative to air freight. “When you talk to [an artist’s] business management, and they go, ‘Well, we can do this by ocean,’ [and] you go, ‘We can, as long as you’re good when I phone you and say, It’s on the water, it’s going slower, it’s now added another stop which wasn’t scheduled, we won’t make it for the first show,’” he says. “And then they go, ‘Well, that’s no good.'”

Justin Carbone , executive vp of live touring at Rock-It Cargo, says that due to the Iran war, cargo ships have also been avoiding sailing through the Middle East, forcing them to take longer routes. “That’s added some days,” he says, though he hastens to add that “with proper planning, we’re able to mitigate those longer distances.”

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Though all levels of tours will be affected by the fuel price spikes — from club acts to stadium superstars — most people who spoke with Billboard for this story agreed that smaller to mid-level artists will be hurt the worst. “The artists at the club level, their grosses are just less, and so the margins are tighter, and they’re gonna feel it more,” says Doug Oliver , general manager at Pioneer Coach. “The big tours are going to feel it too, but I think it’s gonna be more real to a smaller band.”

Smith says she’s slightly more worried about “middle-class acts” than smaller artists, as the former typically has a higher overhead and is saddled with expectations by fans to put on a more elaborate show. “With lower costs to put a show on…it might be a little bit different for a baby artist than a band that’s trying to continue what they’ve built already, or get to a bigger point, because those people have a lot of built-in expenses and have to put on a bigger show in many ways,” she says.

Still, artist manager Ari Fouriezos — who works with acts including Caroline Rose , Julia Jacklin and Cassandra Jenkins at Friendly Announcer — is concerned about higher fuel prices further discouraging baby acts from going on the road. “I worry for the future generation of indie bands that are coming up right now,” she says. “I feel like they for years have been pretty discouraged when it comes to building touring fan bases, because they feel like it’s not accessible to them. I think stuff like this is just adding fuel to the fire.”

Faced with post-COVID cost increases, and now with higher fuel prices, many tours have been forced to get creative to come out in the green. Multiple artist managers who spoke with Billboard for this story have, where it makes sense, leaned into offering VIP ticket packages for fans that include perks such as meet-and-greets, sound check parties and exclusive merch items to get the most out of every ticket. Fouriezos also says more artists are “becoming more hyper-local” by doing shows in their immediate locations versus going on expensive cross-country tours.

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With her artist Caroline Rose, Fouriezos says the strategy for the singer-songwriter’s upcoming summer tour has been to book multiple nights in the same city, and “even two shows in the same night” at the same venue, to save on travel costs. For several stops on the tour, they’ve also rented venues so they can control the ticketing themselves. In this scenario, they’re betting that Rose will sell out those shows — in which case, Fouriezos says, they’ll make “slightly more” than they would have if they’d gone the traditional route. Without the added fees from a ticketing company like Ticketmaster or AXS — a point they’ve promoted to Rose’s followers on social media — this also effectively allows them to lower ticket prices for fans, with the hope that some will spend what they saved on the ticket on merch. “Everyone is more price sensitive right now, but more willing to spend their hard-earned money if they are confident it’s supporting their favorite artists” versus a company like Live Nation, she says.

Cutting down on production costs is another way to increase margins. Thomson says he’s recently had some clients step back from confirming tours as they figure out where else they can trim. “Conversations are just going to get tougher and more about, ‘Where can we cut? Let me see every line item,’” he says. “That’s because of the fuel, but it’s been going on before the war happened because of the [rising] cost of transportation in general.”

There’s also a more direct way to deal with rising costs: passing them on to fans. For tours that are already in motion, however, raising prices on tickets isn’t feasible. “A lot of their contracts are priced in, and they can’t raise the price of concert tickets,” says Oliver. For those who are still able to raise prices, it can be a tricky balancing act in an economy where fans are paying more for everything, from food to filling up their tanks — not to mention the costs of attending a concert beyond just the price of admission.

“Not only are fans having to pay for tickets, but oftentimes it’s the parking as well, and drinks, and maybe it’s merch and dinner before, or if [it’s] an older demographic, you’re having to pay for a babysitter,” says Marek.

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Another possible area to increase prices is merch — but as with ticket prices, Smith says it’s best to proceed with caution. “Theoretically, we could raise prices on merch, but again, fans are pretty price sensitive when the cost of living increases,” she says. “Potentially it can impact ticket sales and merch sales. So, we just have to be really careful with that.”

As it stands, many experts say that even if the Strait of Hormuz were to open up tomorrow, fuel prices will remain elevated at least through the end of the year — meaning tours are staring down, at a minimum, several more months of inflated costs.

For Fouriezos, at least, there’s a silver lining. If nothing else, she says, the extra squeeze will force artists and their teams to get more creative — and possibly devise new paradigms for a touring market that’s grown increasingly hostile to artists over the last several years. “I hope that other people will be inspired to think outside the box…and question the norms and be like, ‘How can we do things a little bit differently?’” she says. “And it’s not easy. It’s actually really, really hard to do things like that.”

_Originally reported by [Billboard](https://www.billboard.com/pro/how-high-gas-prices-difficult-touring-market-worse-artists/)._