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Airlines accused of ‘limiting competition’

London air traffic numbers are up at Heathrow and Gatwick airports

A study conducted by GRA claims that airline consolidation limits competition and decreases consumer choice, contributing to higher prices.

The study, entitled Impact of Airline Consolidation on Consumer Choice, was supported by the European Federation of Travel Agents’ and Tour Operators’ Associations (ECTAA), the European Passengers Federation (EPF), the European Technology & Travel Services Association (ETTSA) and air passenger rights watchdog Friendly Flying.

The organisations involved claim that airline consolidation and carriers’ limitations on the kind of information published on GDSs and third-party search engines is leading to a reduction in choice for consumers, as well as an increase in fares. The report says carriers are using “anti-consumer strategies” to drive customers to their own sites in order to “avoid the competition they face on independent channels.”

Michel de Blust, secretary general of ECTAA, said: “Neutral, independent travel distribution plays a critical role in providing transparency and real choice for consumers and travel buyers. As the study shows, if powerful airline groups are allowed to engage in discrimination of the neutral distribution channels, consumers will pay the price in the form of less choice and higher fares.”

Christoph Klenner, secretary general of ETTSA, commented: “Consolidation on its own reduces the number of competing airlines, but what is more, the larger airlines and airline groups become more powerful. This power allows them to hold consumers captive to their biased websites in order to reduce transparency and deprive them of the ability to compare competing options.”

The report also points to the number of airlines and alliances introducing surcharges for booking tickets through third-party platforms such as GDSs as a way companies are “penalising consumers who want to compare offers”.

Read the full report here.

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