TRAVEL ALLIANCE APPLAUDS DOJ LAWSUIT
The Consumer Travel Alliance (CTA) applauds the U.S. Department of Justice (DOJ) for filing a lawsuit blocking the proposed merger between US Airways and American Airlines. According to CTA officials, the DOJ has shown that they are standing on the side of consumers in protecting competition within the airline industry. The CTA has been at the forefront of the anti-merger activists since February when American and US Airways announced their corporate marriage. CTA was intimately involved with this process every step of the way — from the beginning when their director, Charlie Leocha, wrote the first USA Today editorial slamming the proposed merger.
Between February and June, CTA met often with DOT, DOJ and congressional staffers from the Judiciary Committee and Commerce Committee to cement the consumer position — no consumer benefits, no new destinations, massive loss of competition, increased airfares and airline fees, and no labour peace. It was, say officials, the overlapping connecting route study completed by CTA in April and released in May that helped change how this merger was perceived across the US. The study documented that there were more than 750 competing connecting routes that would lose competition.
The legacy airlines, reports the CTA, also brought the issue of airline fees into these merger deliberations by raising the change fee from $150 to $200, all within days of each other. That action clearly demonstrated the kinds of problems consumers would face in the future with both airfares and fees.
DOJ’s comments parallel the arguments presented by Leocha and the CTA before the Aviation Subcommittee of the Senate Commerce Committee and submitted to the Antitrust Subcommittee of the Senate Judiciary Committee: There is no need for this merger, both airlines are capable of operating on their own; There are no consumer benefits to this merger; There are no net new destinations created by this merger; Competition and service will suffer on a national basis when overlapping connecting routes are considered. It will be easier to raise airfares and fees; Labour peace is not guaranteed by this merger.
