Competition Bureau scrutinizes airline prices and concentration as key concerns in the industry – Business News

The Competition Bureau is launching a study into Canada’s airline industry, citing market concentration, high prices, and a surge in customer complaints as key factors driving the investigation.

With two major carriers dominating the market and new airlines struggling to enter, domestic fares are deemed “relatively high” by the regulator. The number of passenger complaints has also reached a record high, surpassing 72,000, according to the Canadian Transportation Agency.

The bureau’s review aims to gather feedback from the public and interested parties to make recommendations to the government that would promote competition and empower consumers to make informed choices. This study marks the bureau’s first since gaining new powers in December, including the ability to compel information from companies.

Competition Commissioner Matthew Boswell emphasized the significance of the airline industry to residents and the economy, highlighting the need for more competition to drive down prices, improve services, and enhance productivity.

Recent developments in the industry include the disappearance of low-cost carriers Swoop and Lynx Air, WestJet’s acquisition of Sunwing Airlines, and the expansion of Porter Airlines in a bid to become the country’s third major airline. Air Canada and WestJet have strengthened their hold on the domestic market, commanding 82% of domestic traffic among national carriers last month.

While major cities continue to be well-served, smaller ones face limited options, leading to higher prices and potential passenger inconveniences. The Competition Bureau’s study is not focused on specific allegations of wrongdoing but aims to address broader concerns about competition and consumer choice in the airline industry.