The US government says it is launching a broad investigation into the state of competition in air travel, including the effect of mergers and joint ventures between airlines – a move US Travel counters is little more than “disappointing political stunt.”
The public enquiry is being handled by the Justice Department’s antitrust division and the Transportation Department, which have successfully blocked three airline deals in the past four years, amidst criticism of airlines by President Joe Biden for charging “junk fees.”
However, the timing of the announcement – less than three months before Biden leaves office, and with the race to succeed him considered a toss-up – casts uncertainty over the fate of the investigation.
“Unfortunately, the timing of this ‘broad inquiry’, which was announced 12 days before a national election, suggests political motivations,” trade group Airlines for America said in a statement, and noting, “Air travel is at an all-time high.”
The US Travel Association also weighed in: “(The) announcement by the Departments of Transportation and Justice that they will launch ‘broad inquiries’ into airline business practices is another in a long line of disappointing political stunts. Airfares are at new lows and air travel demand is at historic highs.
“Yet air travel could be improved – by investing in technology, funding airport improvements and addressing the shortage of 3,000 air traffic controllers. Rather than solve these serious, complex and long-standing problems, the Biden administration is choosing to politicize the air travel process and, in so choosing, fail the American traveller.”
Four airlines dominate the US airline industry – United, Delta, American and Southwest. They are the product of mergers that eliminated several major airlines. The airline industry says that there is plenty of competition, however. The industry points to Transportation Department data that shows average US airfares have generally declined for many years, although that has been partly offset by higher fees for baggage, premium seats and other items.
In the second quarter of this year, the average ticket was $382, according to the government figures. That is down from $404 in the same quarter of last year and $438 in the same period of 2019, before the coronavirus pandemic.
The departments said they would they also look into the way air travel is priced and sold, and airline frequent-flyer programs.
The agencies said they will take public comments until Dec. 23.
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