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US lawmakers say Spirit-Frontier merger could drive up airfares

WASHINGTON (AP) – Several congressional Democrats are warning that the proposed combination of Frontier Airlines and Spirit Airlines would reduce competition among low-cost carriers and drive up fares during a time of inflation.

The lawmakers said previous mergers have hurt consumers and workers, and if Frontier and Spirit ever drop their budget-carrier business model, the industry “would lose an important check on prices”.

Senators Elizabeth Warren and Bernie Sanders, along with Representative Alexandria Ocasio-Cortez and five others urged Transportation Secretary Pete Buttigieg and the head of the Justice Department’s antitrust division to review the merger closely for potential violations of anti-trust law, and consider acting to stop it.

The federal agencies declined to comment on Friday beyond saying they had received the letter.

The Biden administration has signalled that it will scrutinise mergers more closely to promote competition. In September, the Justice Department sued to block a partnership in which American Airlines and JetBlue Airways agreed to work together in the Northeast. The Trump administration had allowed that deal to go through.

Frontier and Spirit announced last month that they would combine in a USD2.9-billion deal to create the nation’s fifth-largest airline by passenger-carrying capacity. Denver-based Frontier would have a controlling share.

They said their deal would help consumers by creating a more powerful low-cost competitor to American, Delta, United and Southwest, which together control about 80 per cent of the (United States (US) air-travel market.

The lawmakers, however, said, “Spirit and Frontier are already the two least-liked airlines in America”, and a merger could make the customer experience worse because travellers who get mistreated would have no close alternatives among discount carriers.

Frontier Airlines jetliners sit stacked up at gates along the A concourse at Denver International Airport. PHOTO: AP