The Competition and Markets Authority (CMA) has launched a CMA drip pricing probe into three companies, Trainline, Virgin Atlantic and RED Driving School, over concerns that mandatory fees were not shown to customers in the upfront headline price. The watchdog has issued advisory letters to all three firms as part of its first consumer protection drive using new direct enforcement powers.
Drip pricing refers to the practice of separating compulsory charges from the initial price displayed to customers, with those fees added later in the buying process. The CMA’s move comes as households remain under sustained pressure on spending, and as the regulator sharpens its focus on pricing transparency across consumer-facing sectors.
‘At a time when many households are watching every pound they spend, it is important that people are not surprised by extra fees when booking train and coach tickets, holidays or driving lessons,’ said Emma Cochrane, executive director for consumer protection at the CMA. Cochrane added that opaque pricing makes it harder for customers to compare offers with confidence. ‘The first price customers see should be the price they pay,’ she said.
What the CMA drip pricing probe covers for each firm
The investigation into Trainline centres on whether mandatory booking fees are included in the prices customers first see. The CMA said it ‘observed’ transactions where additional fees ranged from 59p to £2.79. Yahoo Finance reported that the fees included a £1.50 booking fee on coach journeys, a specific charge the watchdog flagged during its review of the platform.
Virgin Atlantic, the airline founded by Sir Richard Branson in 1984, faces scrutiny over whether mandatory resort fees and local taxes were included in the upfront prices shown to customers booking package holidays. ‘These fees can vary but can cost hundreds of pounds and significantly increase the price of a holiday,’ the CMA said. The regulator has not yet concluded whether Virgin Atlantic has broken the law.
RED Driving School, which operates a network of over 1,700 franchised driving instructors and is one of the largest national driver education providers in the UK, will be examined over whether its mandatory booking fee and digital fee were properly displayed to customers booking lessons online. As with the other two firms, the CMA said it is at the beginning of this investigation and has reached no conclusions.
A second strike against the driving lessons sector
The action against RED Driving School is not the first time the CMA has turned its attention to the driver education market. Earlier this year, the watchdog ordered two other driving schools to give refunds to more than 80,000 customers after they failed to disclose the total price for lessons upfront during the online booking process, according to the BBC. That earlier action signals a pattern of concern about pricing practices in the sector rather than a one-off intervention.
The CMA’s new enforcement powers, granted under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), allow it to decide whether consumer protection laws have been breached without taking a business to court first. The regulator used those powers to issue its first round of fines earlier this year, fining ticket seller StubHub £889,200 after customers were required to pay mandatory delivery and service fees that appeared only at the final stage of the checkout process when purchasing tickets for concerts and sporting events.
The three new cases sit within that same enforcement framework. Advisory letters have been issued, meaning the companies are now on notice that the CMA has identified concerns but no formal finding has yet been made. The watchdog has been clear that it has reached no conclusions on whether any of the three firms broke the law, and all remain at the early stages of scrutiny. The CMA drip pricing probe is nonetheless a direct signal that the regulator intends to use its expanded powers broadly and repeatedly, with consumer-facing pricing the primary target.
