DoT Investigates Major U.S. Airlines’ Frequent Flyer Programs
The US Department of Transportation (DOT) has initiated an investigation into the frequent flyer programs of American Airlines, Delta Air Lines, United Airlines, and Southwest Airlines. This inquiry aims to safeguard consumers from “potential unfair, deceptive, or anticompetitive practices,” according to a DOT statement, cbsnews.com reported.
Transport Secretary Pete Buttigieg emphasized the importance of the investigation, stating, “These programs bring real value to consumers. But, unlike a traditional savings account, these rewards are controlled by a company that can unilaterally change their value. Our goal is to ensure consumers are getting the value that was promised to them.”
The DOT has requested detailed records and reports from the four airlines, focusing on several key areas:
- Program Changes: Airlines must outline every modification made to their rewards programs over the past six years. This includes impacts on existing points and statuses, and any options provided to members to retain their earned value and benefits.
- Reward Valuation: Carriers are required to disclose the average dollar value of one reward point, its value when redeemed for various services, the price to purchase points directly, and any practices related to dynamic pricing.
- Fees: The DOT seeks detailed information on all fees associated with rewards programs, including the actual cost of each fee and the justification for charging them.
- Mergers and Partnerships: Airlines must provide documentation on their mergers involving rewards schemes, the integration process of these programs, and how they manage and monitor their partnerships and other rewards programs.
The Airlines for America (A4A) lobby group defended the industry, asserting that US airlines maintain transparency in their frequent flyer schemes and urging policymakers to ensure the continuation of these consumer benefits.
In response to the DOT’s inquiry, Delta Air Lines confirmed receipt and indicated it will comply. United Airlines and American Airlines have referred to A4A’s comments, while Southwest Airlines emphasized its commitment to providing a rewards program with flexible travel policies, availability of reward seats, and points that never expire.
This investigation underscores the DOT’s commitment to protecting consumer interests and ensuring that the value promised by frequent flyer programs is upheld.
Sources: AirGuide Business airguide.info, bing.com, cbsnews.com, US Department of Transportation (DOT)