NEW YORK — The government is trying to put a stop to rising airfares and fees by blocking the latest airline merger — but for fliers, it’s already too late.
The past decade has seen the largest transformation of the airline industry in a generation. Prior to 2005, there were nine major U.S. airlines. Today, just five.
The merger of American Airlines and US Airways would reduce that number to four. But Tuesday, the Department of Justice moved to block the deal, saying it would cost consumers hundreds of millions of dollars a year in higher fares and extra fees.
Even before this, the cost of flying had gone up for consumers as the industry consolidated. The average cost of a round-trip domestic ticket — including baggage and reservation change fees — grew to $378.62 last year, up from $351.48 in 2008, when adjusted for inflation.
The airline industry has been searching for stability since the government stopped regulating routes and prices in 1978. Companies that once had profitable monopolies faced startups that undercut their fares. Since deregulation, 195 airlines — small and large — have filed for bankruptcy. Some emerged stronger. Some stopped flying. Others survived through mergers.
While deregulation created havoc for the airlines’ bottom line, it did open up flying to the masses. As new airlines started flying, prices fell dramatically. Mergers have reversed that trend.
Consolidation has made the airlines more stable, provided job security for thousands of employees and rewarded Wall Street investors. Business travelers have benefited from more flight options and easier connections. But families looking to go on vacation face higher fares and fewer airlines to choose from.
