Senators query if Frontier, Spirit Airways are manipulating seat pricing

By David Shepardson

WASHINGTON (Reuters) – Three U.S. senators stated they need Frontier Airways and Spirit Airways (OTC:SAVEQ) to reveal whether or not they’re manipulating seat charges through the use of prospects’ private data to cost completely different charges to passengers on the identical flight.

Senators Maggie Hassan, Josh Hawley and Richard Blumenthal cited on Wednesday the carriers’ determination to ask for private data earlier than revealing seat charges, including the airways had been apparently “utilizing prospects’ private data to cost completely different seat charges to passengers on the identical flight” regardless of having the identical fare. The senators stated the carriers might be utilizing customers’ ZIP codes, search historical past or different data “to affect pricing.”

In a letter, they referred to as on the airways to cease gathering private data earlier than displaying charges, saying it undermines customers’ confidence, reduces competitors and prevents prospects from precisely evaluating costs.”

Frontier declined to remark. Spirit didn’t reply to a request for remark. The senators additionally wrote to Amadeus-owned software program agency Navitaire asking if the airways had requested it gather knowledge and use it of their pricing algorithms. The corporate didn’t instantly remark.

Final month, the bipartisan group of senators took half in a listening to that harshly criticized rising airline charges for baggage and seat assignments, calling the charges unfair and noting how completely different prospects are charged in another way.

“That is Russian roulette,” Hawley stated. “No person enjoys flying in your airways. It is a catastrophe. … It is completely horrible.”

A report disclosed that 5 U.S. airways, together with Frontier and Spirit, collectively earned $12.4 billion in income from seat charges between 2018 and 2023.

Airways say the charges are about buyer selection however acknowledge the costs are a key a part of their income construction as they face rising prices.

A year-long investigation by Blumenthal’s panel discovered that carriers are more and more utilizing algorithms to set charges.

Frontier and Spirit paid $26 million to gate brokers and others between 2022 and 2023 to catch passengers not paying the airline’s required bag charges or having outsized gadgets, the committee stated.

Final 12 months, U.S. airways sued to dam the U.S. Transportation Division’s new rule on upfront payment disclosure.