Alternatives to auctioning off New York flight slots
— -- When too many airplanes vie for the same airspace, flight delays inevitably result. Such is the pervasive problem plaguing New York City's three overtaxed airports. Although New York accounts for just 12% of the nation's commercial airline operations, it produces 45% of all flight delays, according to John M. Meenan of the Air Transport Association of America (ATA). Flight delays originating in New York rapidly ripple across the aviation grid from coast to coast.
2007 was one of the worst on record for flight delays, with many emanating from the New York metropolitan area. It is no wonder Federal Aviation Administration (FAA) is trying to fix this problem as quickly as possible. Unfortunately many of the FAA's stopgap measures are mired in doubt and controversy, and opposed by airlines, the business community, politicians and others.
First, an FAA proposal to re-route air traffic and better utilize airspace sparked a wave of protest from communities directly under those new flight paths. Airlines then balked at an FAA move to give airports greater flexibility in assessing higher airport utilization fees for peak hour flights and to allow those fees to fund airport improvements. Now a plan to cap flights at all New York airports and sell takeoff and landing slots to the highest bidders is running into stiff headwinds from many who believe such auctions are unfair, unproductive, illegal, and detrimental to the welfare of the local community.
ATA recently filed a lawsuit to stop the planned auctions and even the federal government's own General Accountability Office (GAO) declared such auctions illegal. Undeterred, the FAA still plans to conduct its first auction early next year, just days before a new administration takes office.
Earlier this year, the FAA imposed caps or limits on the number of flights that can takeoff or land in any given hour at New York JFK and Newark Liberty. This is not the first time New York airports have endured flight caps. While caps may help reduce delays, limiting the number of flights stifles competition and results in higher airfares and fewer choices for travelers. In addition, over the long term, capping flights will adversely impact businesses, tourism and eventually the entire local economy.
The FAA claims the slot auctions will increase competition and bring new airlines into the market, but airlines are among the most vocal opponents to this idea. Flight caps favor the airlines already holding those limited resources, while keeping newcomers at bay. Incumbent airlines may be willing to stunt their own growth to shut out competitors, and then benefit from charging higher fares.
Yet those same incumbent airlines are up in arms about the auctions. Some slots will be involuntarily confiscated, which they fear could fall into the hands of low-cost competitors. As such, current slot holders are vigorously fighting the FAA in what they characterize as a Robin Hood quest.
Smaller, low cost, discount airlines are also not thrilled about auctions, fearing they may be unable to afford these slots because they don't have large capital reserves and will be outbid by the network airlines.
While flight caps and slot auctions ultimately hurt travelers and the local economy, reforming the fees airlines pay for takeoffs, landings and airport use has greater promise. Currently, most airports assess usage fees based solely on aircraft weight. This means a two-seat Cessna pays a fraction of the cost of a 400-seat jumbo jet, even though it costs the same to navigate each one through air traffic control.
Over the past decade, there has been a major downsizing of airline fleets with the proliferation of regional jets. The regional jet has been a major contributor to airport congestion. As just one example, before regional jets there were two non-stop mainline flights between Louisville, and all New York airports. Today those two mainline jets have been replaced by six regional jets on this same route. So even if the overall number of passengers on this route hasn't changed, there are four more airplanes competing for space and adding to New York's congestion problem.
If all or part of takeoff/landing fees were based on a flat rate per airplane, it would encourage airlines to operate fewer flights with larger jets. Furthermore, if takeoff and landing fees were higher at peak times, it might encourage some airlines to move more flights to off-peak times. While the cost of takeoff/landing fee increases would ultimately be borne by travelers, and fewer flights aboard larger jets at more off peak hours may take away some convenience, these two solutions alone might alleviate the need for caps, slots and auctions altogether. Furthermore, if airports use those takeoff/landing fees to invest in new technologies and other projects to increase airport capacity and efficiency, the added takeoff/landing fees will be money better spent.
What is most bothersome about the FAA's short-term, short-sighted solution for flight delays is that it ignores technology and fails to address the big picture. A multi-disciplinary task force commissioned by the FAA identified 77 procedural and technological recommendations that could be implemented to increase capacity at congested airports, but the FAA persisted on pushing their auction agenda on New York seemingly at the expense of all other solutions. There is some hope from "Next Gen," a satellite-based, GPS-like, air traffic control tracking system that will increase the capacity of all airports and improve air traffic flow. Unfortunately, Next Gen won't be fully implemented for another 15 or 20 years.
Finally, the FAA has paid little attention to long term solutions, like new airports with high speed rail links in the terminals as they have done in Europe. The three major New York airports can't really expand, but there is no reason why they can't be served by rail links and why another facility, such as Newburgh's Stewart Airport or a nearby former military air base couldn't handle a greater share of the traffic.
A high speed rail network in the Northeast could eliminate most flights of less than 500 miles, making it faster to connect from plane to train to complete the shorter leg of your journey. And the elimination of most under-500 mile flights alone would solve the congestion problem without resorting to rationing or auctioning slots.
If the FAA really wants to stimulate competition, they would lift all the flight caps and allow the market forces to dictate the correct number of flights and the optimal size airplanes. Flat fees per airplane and peak hour pricing could easily change the equation and alleviate the immediate crisis. Then the FAA could focus on implementing new technology, building new airports and integrating high speed rail into the mix. And if they don't, a new administration is just around the corner.
Send David your feedback: David Grossman is a veteran business traveler and former airline industry executive. He writes a column every other week on topics of interest and concern to business travelers. E-mail him at travel@usatoday.com.