US transportation chief: 5 Airlines probed for price-gouging
WASHINGTON (AP) — U.S. transportation authorities have opened a price-gouging investigation involving five airlines that allegedly raised airfares on domestic flights after a deadly train crash in May disrupted rail service, officials said.
The Transportation Department sent letters on Friday to Delta, American, United, Southwest and JetBlue airlines seeking information on their prices for flights to certain destinations in northeast United States before and after the May 12 train crash.
“The idea that any business would seek to take advantage of stranded rail passengers in the wake of such a tragic event is unacceptable,” U.S. Transportation Secretary Anthony Foxx said.
Authorities are exploring whether the price hikes violated federal regulations prohibiting airlines from engaging in unfair and deceptive practices. The letters to airlines explain that generally a practice is “unfair” if it “causes or is likely to cause substantial injury to consumers,” cannot be reasonably avoided by consumers and “is not outweighed by countervailing benefits to consumer or competition.”
Delta said in a statement that it lowered its highest shuttle prices after the train crash “by nearly 50 percent, to about $300 each way,” for travel between New York, Boston and Washington. The airline said it also honored existing tickets for travel between Washington, Boston and New York, waived change fees for travel on Delta Shuttle flights between those markets, and increased seat capacity in the region by adding flights and operating larger aircraft.
United said it also did not raise fares. JetBlue said it is cooperating with the investigation. Southwest noted that it doesn’t serve the majority of routes the department is looking at.
Eight people were killed and about 200 were injured in the Amtrak crash in Philadelphia, temporarily disrupting service.