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DOT Might Fine Carriers

The Transportation Department has launched an investigation of airline scheduling practices that may lead it to issue fines against as many as eight carriers.

"We have regulations that prohibit unrealistic scheduling as a deceptive practice," Andrew Steinberg, assistant secretary for aviation and internal affairs said last week at a House Aviation Committee hearing on consumer issues.

"We want to understand how it is possible that a flight could be late 70% or 80% of the time, and that information not disclosed," Steinberg said.

The investigation involves two areas. One is unrealistic scheduling itself, which is prohibited by department regulations. The DOT interprets the rule as giving it the power to ban flights that are late more than 70% of the time, a spokesman said.

It's unclear whether the agency has approached the airlines about the investigation, but several carriers told TheStreet.com on Tuesday that they haven't been contacted so far.

"No carrier willingly operates late flights," said David Castelveter, spokesman for the Air Transport Association. "It's in the carrier's interest to give its customers a realistic expectation of the flight's arrival time."

The second issue being probed involves the failure of reservation agents to disclose, when asked, how often a flight is late. The disclosure is required by law when a customer requests the information.

A telephone survey by the DOT inspector general found that agents didn't provide the information in 41% of 160 calls to agents. The DOT may fine up to eight carriers as a result, the spokesman said.

The DOT reported recently that in February, 143 flights were late more than 80% of the time and seven flights were late 95% of the time or more. A US Airways (LCC) morning flight from Philadelphia to San Francisco was late 100% of the time.

Of the seven flights that were late 95% of the time or more, three were afternoon or evening departures from Newark to Charlotte, two on US Airways flights and one on an ExpressJet (XJT) flight flown for Continental (CAL - Get Report).

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SYM TRADE IT LAST %CHG
LCC $0.00 0.00%
CAL $32.38 0.28%
AAPL $112.34 4.29%
FB $89.89 3.05%
GOOG $614.34 2.77%

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Chart of I:DJI
DOW 16,351.38 +293.03 1.82%
S&P 500 1,948.86 +35.01 1.83%
NASDAQ 4,749.9790 +113.8740 2.46%

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