Are Lyft and Uber Flirting With Illegal Price Fixing?
"Price fixing is an agreement (written, verbal, or inferred from conduct) among competitors that raises, lowers, or stabilizes prices or competitive terms," according to the Federal Trade Commission's definition of the illegal business practice. "Generally, the antitrust laws require that each company establish prices and other terms on its own, without agreeing with a competitor."
While the nuances of antitrust law are beyond the scope of this article, I noted last month that "there's a fine line between all companies in a sector recognizing the error of their ways and adjusting fares accordingly, and price fixing, which is an illegal form of market collusion." As the ridesharing market continues to rationalize (i.e., raise prices to sustainable levels), Uber (NYSE: UBER) and Lyft (NASDAQ: LYFT) are seeing how close they can get to that line.
Image source: Lyft.
Source Fool.com
