US travel advisors voice concerns over airline competition
The American Society of Travel Advisors has voiced concerns about the lack of competition in the U.S. airline industry, arguing that it creates an "unhealthy competitive landscape."
This statement comes in response to a request for information from the U.S. Department of Transportation and the Department of Justice, seeking insights into the current state of competition in air travel.
Ensuring fair competition and transparency
ASTA emphasizes the need for a level playing field for all players in the air travel market. They argue that airlines must provide Global Distribution Systems (GDSs), which are used by travel agents, with complete access to fare information, ancillary services, flight schedules, and seat availability. ASTA believes this transparency is crucial to ensure fair competition between airlines and travel agencies, ultimately benefiting consumers with better service and lower prices. They also stress that airlines should not be allowed to use their market dominance to unfairly disadvantage the 40% of travelers who prefer booking through travel agents.
Consolidation and dominance
ASTA points to a history of mergers and acquisitions within the airline industry since deregulation in 1978, leading to a significant decline in competition. While deregulation initially spurred a surge of competitive activity, this trend quickly reversed as airlines consolidated. Today, just four major carriers – Delta, American, Southwest, and United – control over two-thirds of the market. ASTA argues this concentration of power is unlikely to change due to the high barriers to entry for new airlines. Furthermore, they highlight the dominance of these airlines in their hub cities and major airports, further limiting competition.
Addressing anti-competitive practices
ASTA also criticizes international airline alliances and certain airline practices, such as American Airlines' previously attempted NDC distribution strategy, which ASTA actively opposed. They argue that such practices stifle competition and harm consumers. ASTA calls on regulators to prohibit these practices, advocating for a fair and transparent marketplace that benefits both travelers and travel agents. They express their eagerness to collaborate with the government to address these competition concerns and promote a healthier airline industry.
