The Justice Department is investigating an inevitable fact of air travel — astronomically expensive ticket prices. And what airline after airline is accused of doing to hike those prices will make your blood boil: collusion.
Collusion is a fancy term that means, quite simply, the airlines may have been working together to ensure that it costs an arm and a leg to fly anywhere.
Airline collusion has been the subject of a DOJ antitrust investigation for two months, and so far, it seems that American, Southwest, and United Airlines have all received letters in connection with the probe, CBS News reported.
Smaller carriers, like Jet Blue and Frontier Airlines, haven’t been contacted, the Associated Press added.
These letters demand records of every communication between each airline (hence, collusion), Wall Street analysts, and major shareholders that reference any scheming over their planes’ capacity, NBC News reported.
Here’s basically what airline collusion is: carriers illegally swap information about new flights, routes, and extra seats, the end goal being to limit capacity and keep ticket prices high. Essentially, they are slowing their own growth.
This alleged scheme first caught the attention of lawmakers when major carriers began to join forces back in 2008, which has already robbed travelers of a ton of money through various new fees. Connecticut Democrat Sen. Richard Blumenthal got the ball rolling, asking DOJ to look into the possibility of airline collusion.
“Consumers are paying sky-high fares and are trapped in an uncompetitive market with a history of collusive behavior.”
Mergers between American, Delta, Southwest, and United began in 2008, and now, these carriers control more than 80 percent of all domestic travel. According to NBC News, they have also gotten rid of unprofitable flights, filled more seats, and made an active effort to slow growth so we would pay more to fly.
From 2009 to 2014, domestic airfare has skyrocketed 13 percent.
Each airline has also started charging flyers for everything they can think of — checking bags, changing a reservation — filling their pockets with $6.6 billion in fees alone. In total, the airlines have made almost $20 billion at our expense, and they’ll make even more when the cost of their biggest expense — jet fuel — goes down.
Naturally, a trade group that represents each airline denies any wrongdoing.
“We are confident that the Justice Department will find what we know to be true: Our members compete vigorously every day, and the traveling public has been the beneficiary, as the DOT’s own data shows that domestic fares are down in 2015. It is customers who decide pricing, voting every day with their wallets on what they value and are willing to pay for.”
[Photo Courtesy Chris Hondros / Getty Images]