U.S. Travel Association Raises Alarm on Possibility of Airfare Pricing Collusion
July 6, 2015
The U.S Travel Association’s President and CEO Roger Dow issued a strong statement after an article came out by The Washington Post that said the U.S. Justice Department was launching an investigation into whether some of the top airlines have colluded to keep prices high.
The article states that prices were driven up by limiting routes and affordable seats. The article also states that representatives from Delta Air Lines, Southwest Airlines, American Airlines and United Airlines confirmed they were among those being investigated and said they were complying with Justice Department requests.
"We fervently hope that the U.S. airlines targeted by the Justice Department's inquiry are cleared of these allegations,” Dow said.
He added, “American consumers are already jaded enough about flying that we've been wondering for a while how many more gut-punches they could absorb before we see a dip in air travel demand - and therefore a dip in the related econometrics for cities and businesses across the country.”
After a series of mergers, what used to be a much larger field of carriers now has narrowed down to the main four - Delta, Southwest, American and United.
In the meantime, even after Sept. 11 had a major impact on all airlines, most now are posting record profits.
"If not for the radical consolidation we have seen in the airline industry in the last few years, we probably would not even be having this conversation,” Dow said.
He added, “Now that four carriers control 85 percent of domestic routes, 'collusion' is a thought that's constantly going to be in the back of the minds of federal regulators.”
The remedy as at Congress’ fingertips, Dow said, adding they need to “make adjustments to airport financing so that individual airports can raise funds to expand terminal space and allow new carriers into their markets. More competitors significantly lessens the possibility that collusion can occur, and the pressures upon prices and service would be tremendously favorable to travelers, and therefore the broader economy”
He urged their partners in the airline business to cooperate fully with this investigation, “and for Justice officials to bring it to the fastest possible conclusion, so that the summer and fall travel seasons can go on unimpeded."
Partner Voices
MGM Resorts is committed to fostering an inclusive and diverse culture, not just among employees and guests but also within its supply chain. The company prioritizes procuring goods and services from businesses owned by minorities, women, veterans, people with disabilities, LGBTQ individuals and those facing economic disadvantages. This commitment is integral to MGM Resorts' global procurement strategy.
Through its voluntary supplier diversity program, MGM Resorts actively identifies and connects certified diverse-owned suppliers to opportunities within its supply chain. The company is on track to spend at least 15% of its biddable procurement with diverse-owned businesses by 2025, demonstrating that supplier diversity is not only a social responsibility but also a strategic business imperative.
Supplier diversity isn’t just the right thing to do – it’s good for business. A diverse supply chain allows access to a broader range of perspectives and experience, helping to drive innovation, entrepreneurship and resilience, while strengthening communities. At MGM Resorts, engaging diverse suppliers ensures best-in-class experiences for guests and clients. Supplier diversity ensures a more resilient supply chain while supporting economic development in the communities in which it operates.
The impact of MGM Resorts' supplier diversity initiatives is significant. In 2023, these efforts supported over 3,500 jobs across more than 30 states, contributed over $214 million in income for diverse-owned businesses and generated more than $62 million in tax revenue. The story extends beyond the numbers – it reflects the tangible benefits brought to small and diverse-owned businesses, fostering economic empowerment in their communities.
MGM Resorts also supports the development and business skills of diverse-owned businesses through investment, mentorship and education. Through the MGM Resorts Supplier Diversity Mentorship Program, the company identifies, mentors and develops diverse-owned businesses to fill its future pipeline, while providing businesses with tools and resources to empower and uplift. Since 2017, the program has successfully graduated 105 diverse-owned businesses and is on track to achieve its goal of 150 graduates by 2025.
MGM Resorts’ commitment to supplier diversity not only enhances its business operations but also plays a crucial role in uplifting communities and fostering economic development. This approach reinforces the idea that diversity is a powerful driver of innovation and resilience, benefiting both the company and the wider community.
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