DOJ subpoenas airlines over keeping ticket prices high
CNN Justice Reporter
WASHINGTON (CNN) — The Justice Department has sent subpoenas to several major airlines as part of an investigation into “possible unlawful coordination” to limit capacity increases, and thereby keeping ticket prices high, a department spokeswoman said Wednesday.
The department sent civil investigative demand letters to airlines on Tuesday, Justice spokeswoman Emily Pierce said.
At issue is whether different airlines are coordinating to keep capacity — the number of seats available on planes — stable, having the effect of keeping ticket prices high.
How the airlines have coordinated isn’t immediately clear, but among the evidence that investigators is considering includes public comments by airline executives and industry analysts.
In recent years, the DOJ allowed two major airline mergers to take place — including United and Continental, as well as American and U.S. Airways. Industry groups have cited the merging of airlines as an example of the business has gotten tougher for consumers.
“If not for the radical consolidation we have seen in the airline industry in the last few years, we probably would not even be having this conversation. Now that four carriers control 85 percent of domestic routes, ‘collusion’ is a thought that’s constantly going to be in the back of the minds of federal regulators,” U.S. Travel Association President and CEO Roger Dow said in a statement.
A United Airlines spokesperson confirmed to CNN that the airline has received a letter from the DOJ “and we are complying with their requests.” Messages left with Delta, Southwest and JetBlue airlines seeking comment were not immediately returned Wednesday afternoon.
The Associated Press first reported on the DOJ investigation.