Major airline collaboration to keep fares high?

[Traderd]

So, DOJ allows the mergers and then marvels at the effect on capacity constraints and fares? Looks like window dressing to me.

http://www.cnn.com/2015/07/01/politics/doj-subpoenas-airlines-unlawful-coordination/index.html

 

[27 driver]

Ya, How dare those airlines make a profit. The DOJ must stop these evil airlines from making profits immediately. Who would have thunk a business should make a profit. If people don't like the cost of airfare they can drive.

 

[redflyer65]

Why would the airlines want to go back to the overcapacity model that was such a failure before?

What did that lead to? Plenty of bankruptcy proceedings.

This more like the DOJ going after some pay off money. Similar to what they've been doing to the banking industry for the last 6 years. Pay us, or will take you to court. It used to be called extortion I believe.

or similar to the outrage over gas price fixing. It made for good media, but what wasn't announced on the news....they never found anything.

 

[XGmaninGA]

When extortion is extracted under color of law, it's called Social Justice.

 

[freightdogfred]

This is what Warren says about the airline business

"Nevertheless, over the past two decades Buffett has made a series of widely reported repudiations of airline investing, including this statement from a 2002 interview with the London newspaper The Telegraph: ?If a capitalist had been present at Kitty Hawk back in the early 1900s, he should have shot Orville Wright. He would have saved his progeny money. But seriously, the airline business has been extraordinary. It has eaten up capital over the past century like almost no other business because people seem to keep coming back to it and putting fresh money in. You?ve got huge fixed costs, you?ve got strong labor unions and you?ve got commodity pricing. That is not a great recipe for success. I have an 800 (free call) number now that I call if I get the urge to buy an airline stock. I call at two in the morning and I say: ?My name is Warren and I?m an aeroholic.? And then they talk me down.?

 

[Traderd]

Why would the airlines want to go back to the overcapacity model that was such a failure before?

What did that lead to? Plenty of bankruptcy proceedings.

This more like the DOJ going after some pay off money. Similar to what they've been doing to the banking industry for the last 6 years. Pay us, or will take you to court. It used to be called extortion I believe.

or similar to the outrage over gas price fixing. It made for good media, but what wasn't announced on the news....they never found anything.

My sentiments on this announcement as well. Media attention as if the administration is interested in the little guy and high fares.

 

[Nindiri]

I'm shocked, shocked to find that price fixing is going on in here!

 

[BILL LUMBERG]

This sounds like Schumer is doing the bidding for JB management to deflect off of the ME3. Interesting timing how this week Emirates answered the claims by the US3 about open skies (which was weak at best) and two days later this probe gets launched to throw the dogs off the scent.

 

[St. Nic]

Southwest is the one bitching to the DoJustice!!!