White House looking into airline price gouging

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White House looking into airline price gouging

White House looking into airline price gouging

US Transportation Secretary Pete Buttigieg attends a Cabinet meeting with US President Joe Biden in the Cabinet Room of the White House in Washington, DC, on September 20, 2024. 

Samuel Corum | AFP | Getty Images

The Department of Transportation said Tuesday it is in contact with airlines about the affordability of their flights in areas hit by Hurricane Helene and those bracing for Hurricane Milton, as concerns about price gouging grow.

“DOT officials have been in touch with airlines to get more information about the capacity and affordability of flights in the affected areas,” a DOT spokesperson told CNBC in a statement.

It is typical for the alarm around price gouging to grow louder in disasters like hurricanes, when demand spikes from consumers scrambling for items like last-minute flights and survival supplies.

Price gouging is the practice of retailers artificially inflating prices dramatically when the retailer’s costs have not increased. In times of crisis, when urgent demand vastly outpaces supply, consumers can be especially vulnerable to price gouging.

Transportation Secretary Pete Buttigieg said in a Monday X post that his agency was “keeping a close eye on flights in and out of areas affected by Hurricane Milton to make sure airlines are not charging excessively increasing fares.”

“The Department takes all allegations of airline price-gouging seriously,” he added.

Florida is preparing for Hurricane Milton to make landfall on its western coast Wednesday, deepening the wounds left by the devastation of Hurricane Helene, which ravaged the southeastern U.S. a week earlier.

In areas where Milton is expected to have the worst impact, local officials have urged residents — and in some cases ordered them — to evacuate.

Flights in and out of Tampa International Airport have been suspended since Tuesday morning. The nearby Orlando International Airport plans to suspend operations at 8:00 a.m. ET Wednesday.

American Airlines and United Airlines have added flights to help get people out of the area.

Nonetheless, demand for airline tickets and other goods has shot up and spiked some prices, compounding concerns that companies could take advantage of consumers in a moment of crisis.

The Florida Attorney General’s Office on Saturday extended the state’s “price gouging hotline,” offering consumers a way to file complaints as the state braces for Milton.

The Florida AG’s office has received more than 450 consumer contacts alleging price gouging related to Helene, which “mostly concern fuel,” a spokesperson told CNBC. The office has received more than 200 contacts related to Milton, mostly about fuel and water.

Though the price gouging panic is normal during natural disasters, just the term “price gouging” has political implications, less than a month out from a presidential election that is extremely close.

Democratic nominee and Vice President Kamala Harris has proposed a federal ban on price gouging in the grocery sector as part of her campaign’s economic platform, though she has acknowledged that the bulk of corporations do not artificially inflate prices.

“These storms and these hurricanes,” Harris said in a Tuesday interview on the “Howard Stern Show.” “When people are desperate in emergencies, some bad actors will jack up prices. We need to go after them.”

— CNBC’s Leslie Josephs contributed to this report.

Read more CNBC politics coverage


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