Summary of FlyersRights Comments on Airline Competition

FlyersRights, the largest airline passenger advocacy organization, submitted comments in response to the Request for Information by the Department of Transportation (DOT) and Department of Justice (DOJ) on the state of competition in the airline industry. FlyersRights welcomes the first comprehensive review of the state of airline competition since the Airline Deregulation Act more than 45 years ago.

Our comments emphasized:

1. Anti-Competitive Behavior: The airlines engage in or have engaged in numerous anti-competitive actions, such as price-fixing, capacity discipline, airline alliances/joint ventures that reduce competition, and increasing barriers to entry. The comments highlighted the role of common ownership among airlines, where the top shareholders of one airline are also top shareholders of other major airlines. Common ownership diminishes incentives to compete, resulting in raised prices.
2. Opposition to Transparency Regulation: FlyersRights noted the airline industry's opposition to regulations that would enhance transparency by requiring the disclosure of critical ancillary fees and argued that such measures would foster competition by providing consumers with the ability to make informed choices and comparisons.
3. Barriers to Competition: FlyersRights raised concerns about the monopoly-like control of airport gates by incumbent airlines, which limits new entrants. It also cited "slot squatting" practices that prevent competitors from using slots at capacity-constrained airports.
4. Solutions: FlyersRights proposed several solutions, including:
   • Introducing flight delay compensation and a reciprocity rule to incentivize on-time performance and reduce passenger harm.
   • Expanding enforcement capabilities of the DOT, particularly through collaboration with state attorneys general.
   • Returning to common gates at airports to prevent gate monopolization and encourage entry and competition.
   • Redistributing slots at airports to increase competition.
   • Protecting the value of consumers’ airline loyalty program assets.
   • Easing capital restrictions to encourage foreign investment and foster competition.

The Airline Deregulation Act was intended to promote fair competition and result in lower prices and better service. But deregulation has led to an oligopoly in the airline industry. Airlines have leveraged market dominance to chase profits for insiders, harming consumers through higher prices, reduced service quality, and lower reliability. FlyersRights advocated for increased regulatory review to promote competition and improve the consumer experience in the airline industry.

To read our full comments, visit this link.