US trying to put a stop to rising airfare by blocking American Airlines-US Airways merger Published on : Saturday, August 17, 2013 With the consolidation of the airline industry in the US, the cost of flying has gone up considerably for the consumers and is expected to escalate further with the latest merger of American Airlines and US Airways. Therefore, the government is trying to put a stop to the merger and rising airfares and fees. The past decade has seen the largest transformation of the airline industry in a generation. Prior to 2005, there were nine major U.S. airlines and today, just five. The average cost of a roundtrip domestic ticket – including baggage and reservation change fees – grew to $378.62 last year, up from $351.48 in 2008, when adjusted for inflation. Andy Brennan, an analyst with IBISWorld, said the government approved merger deals before to save the then-struggling industry. Now that the airlines’ health has improved, regulators are more concerned about airfares. There’s another side to the coin. Consolidation has made the airlines more stable, provided job security for thousands of employees and rewarded Wall Street investors. Business travelers have benefited from more flight options and easier connections. But families looking to go on vacation face higher fares and fewer airlines to choose from. In seeking to stop the American-US Airways deal, the government contends that airlines already follow each other’s moves in setting prices and adding new fees. They even bully each other out of offering sales.
Posted on: Tue, 20 Aug 2013 18:06:47 +0000
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