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Business Travel Coalition Calls Out Airlines on Pricefixing

Industry watchdog the Business Travel Coalition has filed a letter with the Justice Department alleging that the three top US carriers, American, Delta and United have schemed together to change airfare rules that have the effect of driving up the price of an airline ticket on unsuspecting consumers by as much as a factor of seven. This potentially-illegal collusion resulted in changes enacted virtually simultaneously to the three airline’s policies regarding multi-city ticketing. Instead of using the lowest available fare on each segment, the new policy combines the highest fares available on each segment and returns a round-trip single price that is substantially higher than if a consumer purchased separate one-way fares. As an example, a three-city trip researched this week returned a coach fare of $2,745 for travel from New York to Los Angeles to Albuquerque to Montreal returning to New York. If priced as four one-way tickets the fare is $898. While a knowledgeable travel agent will be cognizant of the policy change, the threshold problem is that most consumers, especially the majority who are infrequent travelers, will not be aware and will pay dearly when booking online at an airline website. Perhaps most troubling is how the airlines knew that their competitors had made this change given that there was no public announcement. To read more about this major industry development, click here.

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