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Consumer News Release

For immediate release -- Wednesday, January 17, 2001.
Contact Bob Brammer -- 515-281-6699.

Miller Backs US DOT on Protecting Competition in Airline Industry

Des Moines--Iowa Attorney General Tom Miller today called it a major development that the US DOT issued three studies yesterday and policy recommendations aimed at protecting fair competition in the airline industry.

"Secretary Slater and the DOT have conducted a thoughtful process on airline competition issues for over two years," said Miller, who heads the Airline Competition Working Group of state attorneys general. "Their analysis of industry competition and their conclusion that a case-by-case enforcement approach to the problem is the best approach will be very helpful to consumers and communities that are desperate for good options and good fares when it comes to air travel."

Transportation Secretary Rodney Slater said the detailed studies released late Tuesday showed that "airlines may be using a wide variety of tactics to suppress competition." The studies suggested that the largest airlines use their dominance of major hub airports and other means to keep air travel prices artificially high and block competition from new competitors. The research "lays the economic and legal foundation for the Transportation Department to use its authority to promote competition more aggressively," Slater said in an address in New York Tuesday night.

"This is an important and positive development," Miller said. "It validates many of the complaints we have been voicing about the major airlines thwarting fair competition from start-up and low-fare airlines, and it provides a road map for how to tackle this problem. We strongly support the DOT and US Department of Justice taking action on a case-by-case basis against airlines that engage in unfair or illegal competition."

Miller said airline competition is a crucial issue for Iowa and other states that are served by few airlines - especially at a time of sweeping consolidation in the industry.

"The economic vitality of our cities and our state are gravely threatened if we don't have ample choices and reasonable prices when it comes to air travel," he said. "We must have a competitive environment that allows fair competition by Access Air and any other start-up or low-fare airline."

Miller said the DOT studies document how air fares soar after low-cost or start-up airlines are forced to leave markets. Slater said complaints appeared to be valid that the largest airlines sometimes responded to competition from low-fare airlines with unfair practices with a goal of eliminating competition.

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