The Biden administration is launching a wide-ranging probe into the state of air journey within the U.S.
The U.S. Division of Justice’s Antitrust Division and the U.S. Division of Transportation on Thursday collectively introduced a “broad public inquiry into the state of competitors” within the business.
As a part of that inquiry, the federal authorities is looking for a swath of data, starting from the results of previous airline mergers to airport entry and airways’ techniques in relation to ticket pricing — together with rewards applications.
“With this inquiry, we hope to be taught extra from the companies and vacationers on the middle of this important business,” Assistant Lawyer Common Jonathan Kanter mentioned in an announcement asserting the information.
“Our objective with this inquiry is to determine and take away obstacles to competitors in order that extra People can entry the alternatives that include good, inexpensive air service,” Transportation Secretary Pete Buttigieg added.
A commerce group for the biggest U.S. airways slammed the inquiry as politically motivated, coming 12 days earlier than the presidential election— and argued the business “has by no means been extra aggressive,” pointing to DOT knowledge suggesting airfare right this moment, adjusted for inflation, is at historic lows.
“We sit up for sharing with authorities their very own knowledge that reveals simply how aggressive the business is,” a spokesperson for the group Airways for America mentioned in an announcement to TPG Thursday.
Heightened airline business scrutiny
The Biden administration has taken a more durable line on competitors and client protections within the airline business.
The DOJ efficiently blocked American Airways’ Northeast Alliance with JetBlue, and did the identical with JetBlue’s proposed merger with Spirit Airways. Extra just lately, the Biden administration greenlit Alaska Airways’ acquisition of Hawaiian Airways, however extracted key concessions from the service on client protections within the course of.
Day by day E-newsletter
Reward your inbox with the TPG Day by day e-newsletter
Be part of over 700,000 readers for breaking information, in-depth guides and unique offers from TPG’s consultants
Below Buttigieg, the DOT has additionally publicly pressured airways to enhance customer support ensures for passengers affected by flight delays and cancellations, and handed or proposed extra stringent guidelines surrounding accessibility of air journey and passenger rights.
This month, stricter passenger refund guidelines rolled out by the DOT, later codified within the Federal Aviation Administration Reauthorization Act, take impact.
Current months have additionally seen federal businesses and congressional leaders step up scrutiny of airline frequent flyer applications.
Backside line
As a part of this newest inquiry into airline business competitors, the general public may have 60 days to weigh in on a spread of things, from pricing and rewards practices to airport entry and “exclusionary conduct” within the aviation business.
That public remark interval is about to wrap up Dec. 23. With a brand new presidential administration set to take workplace lower than a month later, on Jan. 20, it is unclear what would possibly grow to be of that inquiry.
Earlier than this 12 months’s Alaska-Hawaiian merger, it had been near a decade for the reason that final large airline merger within the U.S., however the decade earlier than that noticed a wave of mergers that decreased the variety of massive U.S. airways to simply 4 large carriers that right this moment management almost 80% of the U.S. market.
Associated studying:
