Collusion investigation targets airlines’ shareholder relationships
Tuesday, 23 Sep, 2015
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Investigators probing allegations of collusion among the four biggest airlines in the US want to examine the link between the carriers and the airline industry’s biggest shareholders.
The Justice Department has asked American Airlines, United Continental, Delta Air Lines and Southwest Airlines about any meetings with major shareholders where the subject of ‘industry capacity’ was discussed.
DOJ officials have reportedly seen studies that suggest air fares remain higher the industry when the same large investors hold shares in multiple airlines.
BlackRock Inc. is one such major investor which has a shareholding in all four airlines under investigation, Bloomberg reported.
State Street Corp., JPMorgan Chase & Co., Primecap and Capital Group were other firms cited as having shareholdings in two or more of the airlines.
An unnamed official said one study calculated air fares were 11% higher due to overlapping investment from major shareholders.
The DOJ is looking into alleged collusion between the carriers to control capacity in order to keep air fares high.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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