CONSUMER GROUP URGES ONE-YEAR MORATORIUM ON AIRLINE MERGERS
The Business Travel Coalition has urged Congress to consider legislation that would set a one-year moratorium on airline mergers.
BTC chairman Kevin P. Mitchell said that studies conducted by the U.S. Department of Transportation show that airlines possess market and pricing power to and from hubs where they are not faced with low-fare competitors and that they are strongly inclined to protect their market power by eliminating new entrants.
The studies “unequivocally substantiate” that the DOT has the authority to act against anticompetitive practices, but that U.S. antitrust laws alone are inadequate to safeguard airline competition and consumers, Mitchell said.
“Any combination among the six largest airlines should be frozen, including the United Airlines-US Airways transaction,” to give the incoming Bush Administration time “to understand complex competitive problems” identified in the DOT study, Mitchell said.