The Competition and Markets Authority has opened formal investigations into three major companies—Trainline, Virgin Atlantic, and Red Driving School—following concerns that they engaged in “drip pricing” practices. This illegal approach displays artificially low initial prices to customers while adding mandatory fees later in the purchasing process, obscuring the true total cost. The CMA stated that the first price shown to customers should represent the final amount they pay, enabling fair price comparison and informed purchasing decisions.
According to the regulator, customers purchasing train and coach tickets, holidays, and driving lessons through these companies were not presented with complete pricing information upfront. Emma Cochrane, the CMA’s executive director for consumer protection, emphasized that unexpected mandatory charges undermine consumer confidence and decision-making. The investigations follow earlier notices issued to the companies regarding their pricing practices.
Trainline acknowledged in a stock exchange filing that it had been collaborating with the CMA for several months and was implementing improvements to how certain fees are presented. The company’s shares declined by up to 14% in early trading following the announcement. Virgin Atlantic stated that mandatory fees were displayed at multiple stages during the booking process but indicated it would review the concerns and cooperate with the investigation. Red Driving School expressed its commitment to customer transparency and said it was engaging with the regulator.
The CMA’s enforcement actions are enabled by new consumer protection powers granted last year, allowing the authority to determine whether consumer laws have been violated without requiring court proceedings. If violations are found, the regulator can require businesses to compensate affected customers and impose fines of up to 10% of global turnover. This month, the CMA ordered StubHub to issue nearly £1.5 million in customer refunds and penalties for drip pricing violations, and previously fined the AA £4.2 million while ordering it to repay over £760,000 to learner drivers for similar practices.
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