Five airlines are being investigated by the US Department of Transportation for price gouging desperate rail commuters after the deadly derailment of an Amtrak train in the Northeast Corridor on May 12. The DOT sent a letter today informing American, Delta, JetBlue, Southwest, and United of the investigation.
The letter asks for a serious amount of information, according to a copy of the letter sent to Delta’s chief counsel. For example, the DOT wants a spreadsheet of the average fare by market, day, and fare class for flights on routes in the corridor from April 28th to May 26th. It also wants the number of tickets sold and passengers carried, as well as comparison data from last year.
That’s just the first of 10 very detailed requests.
“The idea that any business would seek to take advantage of stranded rail passengers in the wake of such a tragic event is unacceptable,” Transportation Secretary Anthony Foxx told reporters. “This department takes all allegations of airline price-gouging seriously, and we will pursue a thorough investigation of these consumer complaints.”
Connecticut Senator Christopher Murphy requested an investigation in a letter seven days after the derailment, referring to a reported $2,309 fare from New York’s LaGuardia Airport to Washington D.C., and anecdotal evidence from constituents.
There’s a separate investigation into price collusion among airlines by the Justice department.
The airlines involved in the DOT investigation have denied wrongdoing, but say they will cooperate fully.
The definition of price gouging in the relevant US law is a practice that “causes or is likely to cause substantial injury to consumers, cannot be reasonably avoided by consumers, and is not outweighed by countervailing benefits to consumers or to competition.”