US to investigate airlines for price gouging after Amtrak derailing

The Transportation Department is looking into whether Delta, American, Southwest, United, and JetBlue 'went beyond the pale' in price hikes after the tragedy, says Secretary Anthony Foxx.

Monitor Breakfast

Several US airlines are being investigated for price gouging in the immediate aftermath of the deadly Amtrak derailment in Philadelphia in May, US Secretary of Transportation Anthony Foxx announced at a breakfast for reporters hosted by The Christian Science Monitor on Friday.

The department on Friday sent letters to Delta, American, Southwest, United, and JetBlue seeking pricing information to be provided within 30 days. The letters begin the process of uncovering whether the airlines “drove up prices in direct response to this incident and created a challenge for consumers who are trying to move in that area at that particular time,” Secretary Foxx said.

He said the airlines allegedly raised fees “beyond what you would normally expect” for the Northeast corridor. He explained that, while prices naturally respond to demand, the department is investigating whether the airlines “went beyond the pale.” 

The secretary also commented on the explosion of drone use by individuals in the United States, including a drone with a semiautomatic gun on it that was built by a Connecticut teenager. A YouTube video titled Flying Gun shows the gun-mounted drone shooting into the woods.

The Federal Aviation Administration, which is an agency within the Department of Transportation, is looking into footage of the drone, which went up on July 10. Foxx’s department, together with the FAA, are working on new regulations to integrate unmanned drones into the aviation system.

An important issue for this and other potentially dangerous consumer electronic goods – such as lasers pointed skyward that can distract pilots – is to be able to backtrack and find out who the owner is, he said.

In another example of technology outpacing consumer protections, Foxx said “car hacking” – where hackers meddle with car computers – requires a government-private sector solution. He urged the auto industry to develop a public-private sector round table to look at these and related issues. “We can’t do it by ourselves,” he said.

On Friday, Fiat Chrysler Automobiles NV announced a recall of 1.4 million vehicles that could be subject to hacking.

Meanwhile, as the July 31 deadline nears for the end of federal funding for highway and bridge repair, the secretary said he was “encouraged” that lawmakers on both sides of the aisle are “earnestly trying” to work out a more sustainable solution than the more than 30 short-term patches that Congress has applied to highway funding over the years. 

The House and Senate are at odds over a way to extend the funding. The House has passed a patch that goes into December, with the understanding that lawmakers will, in the meantime, work on corporate tax reform as a long-term funding solution. The Senate is still working its way through a six-year highway bill that’s only funded for three years, with revenue coming from different pots.

The White House prefers the House bill because of its intention to use corporate tax reform for funding – an idea the president supports. But as Foxx said, he’s waiting for the Senate bill to “congeal” before he weighs in on it.

If no solution is reached by the deadline, 4,000 federal employees would likely be furloughed, and transportation projects around the country be left hanging as the government begins to apportion out its $4 billion cushion.