Watchdog Launches Drip Pricing Probes into Trainline, Virgin Atlantic, Red Driving School

Emma Cochrane, Executive Director for Consumer Protection at the CMA, stated, "Clear pricing helps people compare offers confidently and choose the option that works best for them."

Cochrane added, "Unexpected mandatory charges make this much harder, which is why the CMA initially put these firms on notice over concerns about their pricing practices and is now opening formal investigations."

The CMA's investigation into The Trainline specifically targets mandatory fees for train and coach tickets; observed additional fees ranged from 50p to £2.79.

For Virgin Atlantic, the focus remains on mandatory resort fees and local taxes applied to package holidays. Red Driving School faces scrutiny for potentially not including mandatory booking and digital fees in the upfront prices for driving lessons.

The CMA claims additional fees, ranging from 59p to £2.79, including a £1.50 booking fee for coach journeys, were seen in transactions. Mandatory charges were reportedly separated from the headline price or added later in the buying process.

A mandatory booking fee and a digital fee, typically £7 per booking, were displayed for driving lessons, according to the CMA. Customers had reportedly not been shown the total price upfront when purchasing train and coach tickets, holidays, or driving lessons.

The CMA had previously put these firms on notice regarding their pricing practices, issuing 'advisory letters' to the companies under investigation. Earlier this year, the CMA ordered StubHub to pay nearly £1.5 million in refunds and penalties for similar drip pricing infringements.

The CMA can order compensation and impose fines of up to 10% of global turnover for law infringements. Shares in The Trainline fell by approximately 15% to 206.1p in early trading on Wednesday following the announcement.

A Trainline spokesman stated, "Trainline is committed to offering customers a transparent booking experience with clear pricing and genuine value." He added, "We’ve proactively engaged with the CMA over several months and we are taking proactive steps to enhance how certain fees are presented to our customers. We will continue engaging with the CMA to address their questions."

The Office of Rail and Road previously accused Trainline of drip pricing in 2023, stating that it and six other third-party train ticket sellers were not being upfront about fees. A Virgin Atlantic Holidays spokesman affirmed, "We take our responsibility to customers incredibly seriously and we always want to ensure they can make an informed decision when booking a holiday with us."

The Virgin Atlantic Holidays spokesman also stated, "Mandatory fees are indicated at multiple stages throughout the booking journey." Consumers affected by illegal practices may be eligible for compensation.

Sue Davies, Head of Consumer Protection Policy at Which?, stated, "The CMA shouldn’t hesitate to use its new consumer enforcement powers to fine any firms that have broken the rules – especially after each firm has already received a warning advisory letter."

Davies added, "Following comments made by the Prime Minister last week that unfair pricing practices have no place in our economy, this move sends a clear message to other businesses to follow the rules."