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Aviation Competition: Proposed Domestic Airline Alliances Raise Serious Issues

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Report Type Reports and Testimonies
Report Date June 4, 1998
Report No. T-RCED-98-215
Subject
Summary:

Six airlines that carry about 70 percent of domestic passengers in the United States--Northwest, Continental, Delta, United, American, and US Airways--plan to form three alliances. The airlines say that these alliances will yield such consumer benefits as expanded route networks and combined frequent flier programs. Critics contend that the consolidation will undermine the benefits of deregulation by decreasing competition, which will ultimately reduce passengers' choices and increase fares. This testimony describes the competitive implications of the proposed alliances, including their potential benefits and disadvantages to consumers, and issues that policymakers need to consider in evaluating the net effects of the proposed alliances.

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