by Donald Wood
Last updated: 8:05 AM ET, Fri September 6, 2024
The four largest airlines in the United States have been put
on notice, as the U.S. Department of Transportation (DOT) has opened an inquiry
into the carriers’ rewards and frequent flyer programs.
According to Reuters.com, Transportation Secretary Pete
Buttigieg has requested records and reports from American Airlines, Delta Air
Lines, Southwest Airlines and United Airlines about the loyalty programs to
ensure consumers do not face “unfair, deceptive, or anticompetitive practices.”
The DOT first began investigating the rewards and frequent
flyer programs of top U.S. airlines in December, but the formal information
request comes as the government agency is focused on how Americans are “impacted
by the devaluation of earned rewards, hidden or dynamic pricing, extra fees,
and reduced competition and choice.”
Buttigieg said the DOT will use the information to “better
understand the largest rewards programs and identify potential competition or
consumer protection issues or risks.”
While some lawmakers are concerned that carriers are raising
the bar to earn perks associated with these programs, Airlines for America
claims that the top companies in the industry are “transparent” with the important
programs.
Reuters data found that the loyalty programs for American,
Delta and United were valued at more than $20 billion each last year, while a
Southwest spokesperson said the benefits helped double the industry average of
seats booked with points.
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