DOT Announces Flight Caps at Newark and JFK Airports

LCT Staff
Posted on December 20, 2007

WASHINGTON — Under pressure from the U.S. government, airlines agreed yesterday to cap the number of flights going in and out of New York's John F. Kennedy International Airport during peak periods to cut delays and are negotiating to do the same at New Jersey's Newark Liberty International Airport.

The U.S. Transportation Department (DOT), which pushed for the flight caps at the behest of the White House to do something to reduce congestion, also said it plans to auction takeoff and landing rights — called slots — at JFK and Newark when new capacity becomes available to better manage demand.

"These new measures will cut delays, protect consumer choice, support New Yorks economy, and allow for new flights as we bring new capacity online," Transportation Secretary Mary Peters told a news conference.

But major airlines, mostly those with late afternoon international service at JFK, were dissatisfied with the caps and angry with the prospect of auctions, worried they could permanently lose business as they struggle to maximize revenue with fuel prices near all-time highs and other costs going up.

The changes would apply to U.S. and international airlines, including JetBlue Airways, Delta Air Lines, United Airlines, American Airlines, Continental Airlines, British Airways and Germany's Lufthansa.

Transportation officials said JFK and Newark could handle more flights per day as peak-hour schedules are flattened. But some airline officials and industry experts cautioned more controlled operations could slow the introduction of new competition. They also said the changes could cut flights to smaller cities, and prompt shifts to bigger planes in some cases to accommodate demand at the busiest periods.

Fares could also go up as fewer flights move at busy times, others said. "The consumer competition on those seats mean some pricing power for those airlines," said Robert Mann, an industry consultant.

Additionally, overseas carriers expecting to take advantage of a newly negotiated U.S./EU treaty to launch or expand transatlantic service through JFK could be hurt by the caps.

JFK had the most serious flight delays of any U.S. airport this year. Operations increased 41% from March 2006 to August 2007, according to government figures.

JetBlue handles more passengers than any other airline at JFK at 13 million per year and said the caps were "regrettable but necessary" to smooth the traffic flow.

Delays are also a chronic problem at other New York-area airports, affecting flights nationwide. More than a third of U.S. air traffic uses the metropolitan New York region.

Airlines mainly blame bad weather and air traffic control limits for delays, while consumer groups, some in Congress and transportation planners said scheduling is also a problem.

Under the plan at JFK, peak operations will be limited to between 82 flights and 83 flights per hour beginning in March. Carriers can shift flights to less busy times, meaning the airport can handle more flights overall.

The government plans similar caps for Newark to run concurrently to prevent airlines from shifting peak-hour JFK flights to New Jersey. The hourly limit for Newark is being negotiated but regulators hope to settle the matter by March. Delta Air Lines, which operates more than 170 peak departures per day at JFK and is expanding international operations, had already announced plans to spread out flights throughout the day.

However, Delta and other international carriers are unhappy with plans to auction New York-area slots if airport capacity increases. Slots, especially at JFK, are coveted and expensive, and airlines contend any premium access rights they gave up — about 20 per hour during the busiest times — should not fall into the hands of competitors.

"Carriers such as Delta that have substantially reduced their schedules should have their flights restored before DOT sells new capacity to the highest bidder," Delta chief executive Richard Anderson said in a statement.

The Port Authority of New York and New Jersey, which runs JFK and Newark, called the JFK caps restrictive and said it was "simply wrong" for the Bush administration to pursue flight limits and auctions.

SOURCE: Reuters

LCT Staff LCT Staff
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