The Biden administration has announced a comprehensive investigation into the state of competition in the air travel industry, focusing on the impact of mergers and joint ventures among airlines. This investigation, led by the Justice Department's antitrust division and the Transportation Department, comes in the wake of the administration's previous efforts to block three airline deals in the last four years. President Joe Biden has been vocal in his criticism of airlines for imposing what he refers to as 'junk fees' on passengers.
The timing of this inquiry, however, has raised questions, as it was unveiled less than three months before Biden's term ends and amidst a closely contested race to succeed him. The trade group Airlines for America has expressed concerns about potential political motivations behind the investigation.
Currently, the U.S. airline industry is dominated by four major carriers - United, Delta, American, and Southwest - which emerged from mergers that led to the consolidation of several major airlines. Despite this consolidation, the industry argues that there is still significant competition, citing data from the Transportation Department showing a general decline in average airfares over the years. However, this decline has been offset by the introduction of higher fees for services like baggage, premium seats, and other amenities.
Airlines for America highlights that customer satisfaction with air travel is reportedly at an all-time high, with surveys supporting this claim. The average ticket price in the second quarter of this year was $382, a decrease from $404 in the same period last year and $438 in 2019 before the onset of the COVID-19 pandemic.
In addition to examining competition in the industry, the investigation will also delve into the pricing and selling practices of airlines, as well as the operations of frequent-flyer programs. The public has been invited to provide comments on these matters until December 23, as the agencies seek to gather diverse perspectives on the state of air travel in the United States.
