The American Society of Travel Advisors (ASTA) recently voiced significant concerns about the competitive state of the U.S. airline industry. These comments were submitted to the Department of Transportation (DOT) and the Department of Justice (DOJ) in response to their ongoing public inquiry into air travel competition. ASTA’s submission highlights the challenges travelers face in an industry it describes as an “unhealthy competitive landscape.”
In its remarks, ASTA underscored the importance of ensuring a level playing field for air ticket distribution intermediaries, such as Global Distribution Systems (GDSs) and travel agencies. These intermediaries are vital to the 40% of consumers who prefer booking air tickets through travel agencies. ASTA argues that airlines must provide GDSs with full and transparent access to fares, ancillary services, schedules, and availability. Without this, intermediaries are unable to offer consumers the transparency and options they deserve.
“Transparency is essential if the air transportation market is to function in a manner most likely to consistently deliver a high level of service at the lowest possible price,” ASTA stated in its submission.
Since the deregulation of airlines in 1978, the industry has undergone a significant transformation. While deregulation initially spurred competition, ASTA highlights that a wave of mergers and acquisitions has concentrated market power in the hands of a few major players. Today, Delta, American, Southwest, and United Airlines collectively control more than two-thirds of the domestic market.
This consolidation has created challenges for new entrants due to the high costs and complexities of entering the airline industry. Moreover, major carriers have strengthened their dominance in hub cities and at slot-controlled airports, where access is limited by regulatory approval and operational constraints. ASTA has urged federal regulators to address these imbalances by requiring airlines to divest slots at such airports.
ASTA also raised concerns about the role of international airline alliances, which it believes exacerbate the lack of competition in global air travel. These alliances, though beneficial for expanding route networks, often reduce competition on international routes, limiting consumer choices.
Additionally, ASTA critiqued the International Air Transport Association’s (IATA) New Distribution Capability (NDC) standard. This initiative, while aimed at modernizing how airfare is distributed, has faced backlash due to its implementation challenges and its potential to disadvantage travel agencies and GDSs. ASTA referenced American Airlines’ failed attempt to implement NDC as a cautionary example.
In its 13-page submission, ASTA called on federal regulators to take several actions:
Ensure Equal Access: Airlines should provide transparent and equal access to fare and schedule information for all distribution channels.
Address Slot Control Imbalances: Airlines should divest slots at capacity-constrained airports to foster competition.
Monitor Anti-Competitive Practices: ASTA urged the DOT to prohibit practices that disadvantage competitors without offering clear consumer benefits.
The DOT and DOJ’s inquiry has sparked varied reactions across the travel industry. While ASTA welcomed the initiative, viewing it as an opportunity to address long-standing concerns, other organizations like the U.S. Travel Association dismissed the inquiry as politically motivated.
Despite differing perspectives, the inquiry marks a pivotal moment for reevaluating airline competition in the U.S. ASTA’s advocacy sheds light on critical issues affecting not just travel advisors but also millions of consumers who rely on a fair and transparent system to navigate the complexities of air travel.
As the DOJ and DOT continue their review, ASTA remains committed to advocating for reforms that prioritize consumer interests and ensure a healthy competitive landscape in the airline industry.
