Did airlines price-gouge after Amtrak crash?
U.S. Transportation Secretary Anthony Foxx on Friday said the government is investigating whether five airlines engaged in price-gouging after a deadly Amtrak crash in Philadelphia in May disrupted rail service in the Northeast.
"The idea that any business would seek to take advantage of stranded rail passengers in the wake of such a tragic event is unacceptable," Foxx said in a statement. "This Department takes all allegations of airline price-gouging seriously, and we will pursue a thorough investigation of these consumer complaints."
The Department of Transportation (DOT) sent letters on Friday to Delta (DAL), United, American (AAL), Southwest (LUV) and JetBlue (JBLU) requesting information. The letter asked for information related to allegations of pricing irregularities on air routes that compete with Amtrak's Northeast Corridor service, and specifically requested an explanation for any increases in average fare that occurred between the 15 days prior to the Amtrak crash and the 15 days that followed.
"JetBlue has received a letter from the U.S. Department of Transportation related to its investigation and we will cooperate fully," Philip Stewart, a spokesperson for the airline, said in an email.
"In response to the Amtrak derailment, we added capacity and our fare structure remained the same. We are cooperating with the DOT and are confident that there will be no finding of wrongdoing by American," the carrier stated.
"We have been notified by the DOT that they are conducting an investigation and we will cooperate with that investigation," Southwest stated.
Delta did not return several requests for comment. However, in a posting on its site, the airline denied any wrongdoing, saying it did not increase fares following the Amtrak crash.
"To the contrary, Delta lowered its highest shuttle prices by nearly 50 percent, to about $300 each way, for travel between New York, Boston and Washington, D.C.," spokesman Trebor Banstetter wrote.
Prices on round-trip airline tickets between major cities such as New York City and Washington, D.C., skyrocketed in the wake of the deadly Amtrak derailment, which closed a major stretch of rail line and disrupted travel in one of the busiest rail corridors of the country.
Eight people died and about 200 were injured in the May 12 accident in Philadelphia, which resulted in a shut down of Amtrak service between Washington and New York City for six days.
The government probe was applauded by Senator Chris Murphy of Connecticut, who had called on the DOT to look into possible price gouging by airlines three days after the derailment.
"If the price increases were an effort to profit from desperate travelers impacted by this tragedy, it's simply unacceptable," the Democrat said Friday in a statement.
Murphy's initial request for a federal probe cited a Delta fare from Washington, D.C. to New York priced at $2,309.
In his posted statement Friday, Delta's Banstetter said the fare cited by the lawmaker was a "last-minute 'walk-up' fare and one of the last seats available on the flight."
The Justice Department said earlier this month it was investigating whether airlines worked together illegally to keep fares high by indicating their intentions to curb flights.