Justice Department eyes recent airline ticket price increases NEW YORK (AP) =97 The Justice Department is scrutinizing the=20 $10-per-roundtrip fare increases made by the nation's largest airlines to=20 determine whether carriers violated an antitrust ruling enacted nearly a=20 decade ago. At issue is the way in which airlines make fare changes that do= =20 not affect immediate travel, raising the possibility that they could signal= =20 future pricing plans to competitors. "We are looking into it," Gina=20 Talamona, a spokeswoman at the department's antitrust division said Monday.= =20 On Thursday, American Airlines raised non-sale fares on its North American= =20 routes by $10 per round trip starting June 1. United matched the increase=20 the next day, and eight other carriers had fallen in line by late Monday.=20 The industry raised fares in anticipation of the government's upcoming=20 four-month suspension of security fees, which amount to $2.50 per flight=20 segment, maxing out at $10 per round trip. "Airlines were faced with two=20 choices: give consumers up to a $10 round-trip break, or raise fares," said= =20 Jamie Baker, J.P. Morgan's airline analyst. "Not surprisingly, the industry= =20 chose the latter." Analysts and executives have said for months that the industry, which lost= =20 $3.5 billion in the first quarter, needs to find ways to boost revenue even= =20 as it struggles to cut costs. Fares have been kept extremely low to lure=20 anxious and penny-pinching travelers back to the skies. The fare increase=20 American launched on Thursday =97 the day its new chief executive said= higher=20 ticket prices were key to any recovery =97 is the first to succeed in 2003.= =20 Some industry observers said they were surprised by the manner in which=20 fares were increased, suggesting that it may have violated the spirit, if=20 not the letter, of the law. A 1993 Justice Department ruling says, in part,= =20 that carriers are prohibited from disseminating information about "planned= =20 or contemplated fares or changes to fares." "They seem to have found a=20 loophole," said Terry Trippler, a travel consultant who closely follows=20 airfares. But Tim Wagner, an American spokesman, said "our legal department= =20 has assured us that we are well within our rights" under the so-called=20 consent decree reached between the carriers and the Justice Department. Wagner said the critical issue is that the American made the new fares=20 available through the computerized reservation systems Thursday, rather=20 than just announcing its intentions to raise fares at a later date.=20 "There's not a competitive advantage there ... we were higher than=20 everybody else," until the other carriers decided to match the fare=20 increase, Wagner said. Talamona, the Justice Department spokeswoman, would= =20 not provide details about the agency's examination of the fare increases,=20 other than to say: "We'll look into this matter as we would any potential=20 violation of the consent decree." Clinton V. Oster, a professor at Indiana= =20 University who specializes in airline economics and competition policy,=20 downplayed the hubbub. "The notion of the consent decree is to stop=20 signaling =97 which is, of course, silly," Oster said, "because there are=20 still lots of subtle and not-so-subtle ways to signal through the=20 computerized reservation systems." *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.cso.gov.tt TnT Webdirectory: http://search.co.tt *********************************************************