The Biden administration announced on Thursday its intention to initiate a comprehensive investigation into competition in the air travel sector, focusing particularly on the impacts of airline mergers and partnerships. This inquiry will be conducted by the antitrust division of the Justice Department in collaboration with the Transportation Department.
Over the past four years, the administration has successfully prevented three significant airline mergers from proceeding, and President Biden has been vocal about his concerns regarding airlines imposing excessive “junk fees.” However, the recent timing of this announcement—just under three months before Biden’s term concludes and amid an unpredictable succession race—introduces uncertainty regarding the investigation’s future.
Currently, four main airlines—United, Delta, American, and Southwest—dominate the U.S. air travel market, a situation that has arisen from various mergers that have absorbed numerous major carriers. While the airline industry contends that there is ample competition, data from the Transportation Department indicates that average airfare in the U.S. has generally decreased over the years. Nonetheless, this decline has been offset to some degree by rising charges for services such as baggage, premium seating, and other add-ons.
In the second quarter of this year, the government reported that the average airline ticket cost $382, a reduction from $404 in the same quarter of the previous year, and substantially lower than the $438 average ticket price recorded in the same period in 2019, prior to the onset of the COVID-19 pandemic.
The departments emphasized that they will also examine the pricing mechanisms and sales strategies used in air travel, along with frequent-flyer programs offered by airlines. Public feedback will be accepted until December 23 as part of this investigative process.