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Search of airfare booking sites shows identical pricing

The U.S. government is investigating possible collusion by airlines to keep ticket prices high. The civil antitrust investigation  is looking at whether airlines illegally signaled to each other to limit  seats.
The U.S. government is investigating possible collusion by airlines to keep ticket prices high. The civil antitrust investigation is looking at whether airlines illegally signaled to each other to limit seats. rlahser@charlotteobserver.com

Amid a federal investigation of airline pricing practices, a search on popular air travel booking websites shows identical ticket pricing between popular city pairs on several carriers.

The Justice Department confirmed Wednesday that it is investigating “unlawful coordination” among major airlines. The Associated Press first reported the probe, which seeks to determine whether the few remaining carriers have colluded to keep ticket prices high.

American Airlines, Delta Air Lines, United Airlines and Southwest Airlines all confirmed that they have received letters from the Justice Department and would cooperate with the investigation.

Those four carriers control about 80 percent of the domestic air travel market.

Comparison websites such as Expedia, Orbitz, Kayak, Hotwire and Priceline are supposed to help consumers shop for the best ticket prices. But a search shows they may not have much choice with some round-trip flights.

For example, tickets for nonstop flights to five destinations served by two competing carriers from Charlotte Douglas International Airport are largely identical: A round-trip economy class ticket from Charlotte to Chicago O’Hare departing on Sept. 9 and returning Sept. 14 costs $252 on both United and American.

American operates about 650 daily flights from Charlotte – more than 90 percent of the city’s total – and Charlotte is the airline’s second-busiest hub behind Dallas/Fort Worth.

Similar pricing can be found on some of the most popular city pairs in the country, and not just on the largest airlines.

▪ An economy nonstop round trip from Los Angeles International to John F. Kennedy International in New York costs $397 on Delta, American and JetBlue.

▪ An economy nonstop round trip from Dallas-Fort Worth to New York LaGuardia costs $186 on American, Spirit Airlines and Virgin America.

A spokesman for JetBlue, Philip Stewart, and a spokeswoman for Spirit, Irisaida Mendez, said that those airlines had not received letters from the Justice Department.

According to the federal Bureau of Transportation Statistics, airfares have risen 13 percent in the past five years.

Mergers since 2008 have consolidated eight major carriers into four. Delta and Northwest merged that year, followed by United and Continental in 2010. Southwest bought its rival discount carrier AirTran in 2011, making it the largest domestic carrier.

The Justice Department had few issues with those consolidations, but it briefly challenged the merger plans of American and US Airways on antitrust grounds. The airlines reached a settlement with the department, and the merger went forward in 2013.

Before the settlement, employees of both airlines came to Capitol Hill to protest the Justice Department lawsuit, carrying signs that said “let us compete together.”

Roger Dow, president of the U.S. Travel Association, a group that opposes airline consolidation, said the mergers had created less competition, not more.

“If not for the radical consolidation we have seen in the airline industry in the last few years,” he said in a statement, “we probably would not even be having this conversation.”

Joshua Freed, a spokesman for American, said the industry remains highly competitive, has added capacity and lowered average fares.

“We will cooperate fully with the investigation,” he said in a statement, “and demonstrate that the last two years have presented an entirely new competitive landscape that has greatly benefited air travel consumers.”

Daniel Desrochers and Samantha Ehlinger of the Washington Bureau and Andrea Ahles of the Fort Worth Star-Telegram contributed.)

Identical pricing

A comparison of round-trip economy tickets departing Sept. 9 and returning Sept. 14:

Charlotte to

Chicago O’Hare

$252 on both United and American.

Charlotte to

Houston Intercontinental

$327 on United and American.

Charlotte to

Detroit Metropolitan

$350 on American and Delta.

Charlotte to

New York LaGuardia

$220 on American and Delta.

Charlotte to

Newark Liberty

$199 on American and United.

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