If The DOJ Is Correct, Airlines Should Be Ashamed

If – and that’s a big if – but if the allegations of price collusion being leveled against domestic carriers are true, then the U.S. airlines should be ashamed of themselves and offer a huge apology to the flying public. And a separate apology to the Gulf carriers for being two-faced, pursuing Emirates, Etihad and Qatar airlines with reckless abandon for allegedly violating the Open Skies agreements by gaining a financial advantage in the marketplace in accepting government subsidies – while at the same time deceiving their own customers for financial gain.

But again, that’s if the Department of Justice is correct and several U.S. airlines colluded to limit seat availability, which in turn drives up airfares on existing seats. Justice Department spokesperson Emily Pierce confirmed to the Washington Post on Wednesday that investigators are looking into “possible unlawful coordination by some airlines.”

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Is it true?

The heart says one thing, the head says another.

The heart says the U.S. aviation industry was all but decimated by the terrorist attacks of Sept. 11, 2001, and with financial help from the U.S. government and the trust of the American people they were able to come roaring back. It took time, yes, but domestic carriers all had a banner, record-setting financial year in 2014. The heart says they wouldn’t do this.

The heart also says that after all the mergers left the major airlines with a combined 80 percent market share in this country, why would they collude with each other and share sensitive information about routes and seats and pricing?

That’s the heart.

The head is a different matter.

The head says too many things have conspired to bring us to this point – airline opposition to the full-fare advertising rule, Lufthansa all but forcing passengers to buy tickets through the airline’s distribution channels by instituting a surcharge for purchases made elsewhere; ancillary fees, and having something akin to a captive audience that has no choice but to pay these fees; new ‘tiered’ pricing structures; and, of course, opposition to competition from the likes of the Gulf carriers and Norwegian Air’s desire to fly trans-Atlantic routes.

(And, as a side note, it’s interesting that the Partnership For Open & Fair Skies, the umbrella group for American, Delta and United airlines in their fight against the Gulf carriers, has been strangely silent since the DOJ news broke on Wednesday. The Partnership is a group that never met a press release or real-time tweet it didn’t like).

The head also says it can’t help but think of that old adage that permeates legal circles: The federal government doesn’t open investigations that are likely to be time-consuming and costly to the taxpayers, much less bring charges, unless it is absolutely positive it can get a conviction.

Take that at face value, if you will, but go look up the stats – unless your name is John Gotti, the federal government is batting about .900 when it brings cases to court.

The head says that “capacity discipline” is fancy airline talk for collusion.

Of course, that’s if this truly happened.

For the sake of the airlines, one can only help the DOJ is wrong.

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