Airlines that propose lower fares have a greater chance of getting new routes than those that don't under a major new policy enunicated by the Civil Aeronautics Board.
In launching an investigation to determine whether or not to authorize additional air service in the Chicago-Syracuse-Albany-Boston corridor, a unanimous board said a reduced fare proposal would be a major factor in all future route proceedings.
"We have determined, as a matter of general policy, that in this and future cases the offer or failure to offer lower prices will be taken into account in determining whether the public convenience and necessity require the award of new or additional authority, and if so, which carrier or carriers should be selected," the board said.
Neither of the airlines seeking authority in this corridor, North Central Airlines and Northwest Airlines, proposed reduced fares, and the board pointedly invited "such proposals" from them and any others, including airlines already servicing the routes.
The board said it expects the record of each route case to examine the need for and feasibility of various new price/quality options. It suggested the carriers explore reduced normal fares, promotional fares, off-speak pricing, reduced on-board amenities, higher seating densities, increased load factors and improved aircraft use.
With an eye to assuring that the airline getting a potential new route fulfills whatever promises are made, the board directed the administrative law judge in this case to consider how lower prices and price competition can be maintained once the case is concluded. Making awards temporary or contingent upon the price performance of the carrier receiving new authority were two suggestions made by the board.
The board has begun several low fares in the past - six of ten cases the board labeled "priority" earlier this month focus on low-fare proposals - but this is the first time an overall policy has been used to make fares a factor in all route cases.
The board has been getting an increasing number of applications with low-fare proposals. One, filed by Texas International Airlines, is expected to get expedited treatment when it comes before the board next week.