Thursday, February 9, 2017

President Donald Trump, Meeting With Airline CEOs, Targets Air-Traffic-Control System: Executives seek modernization of a system that Trump calls ‘totally out of whack’



The Wall Street Journal 
By SUSAN CAREY and  CAROL E. LEE
Updated February 9, 2017 7:24 p.m. ET

President Donald Trump has suggested changes to a national air-traffic control system he described as “totally out of whack,” taking on an issue that has foiled numerous previous efforts at modernization.

“We want the traveling public to have the greatest customer service and with an absolute minimum of delays,” Mr. Trump said at the meeting with aviation executives at the White House on Thursday. “And we have an obsolete plane system, we have obsolete airports.”

In addition to funding infrastructure upgrades, Mr. Trump promised the executives he would reduce government regulations and announce within the next three weeks tax reform measures, both of which he said would help companies such as airlines hire more workers. He suggested placing a pilot at the head of the Federal Aviation Administration, the industry’s safety regulator and air-traffic control provider.

His agenda received a warm reception from those who attended the meeting, which included chief executives from United Continental Holdings Inc., Delta Air Lines Inc., Southwest Airlines Co., Alaska Air Group Inc., three cargo carriers and seven heads of airport operators from New York to Los Angeles.

U.S. airlines operate about 27,000 flights a day that carry 2.2 million passengers and 50,000 tons of cargo, according to the Airlines for America trade association. The industry drives nearly $1.5 trillion in U.S. economic activity and more than 10 million U.S. jobs.

Gary Kelly, CEO of Southwest, estimated that last year delays, air congestion, and excess fuel use cost the industry $25 billion. “I think there is near-unanimous agreement that we need to modernize the air-traffic control system,” Mr. Kelly said, according to a transcript of the meeting. “We are still using World War II-era ground-based radar to guide the aircraft. We’re not utilizing GPS satellite-delivered navigational tools.” This leads to longer trip times, he said.

The U.S. air-traffic control system, while very safe, uses radars that only track planes every 16 seconds. Telephone calls to other air-traffic controllers and radio messages to pilots can be prone to misunderstanding. Some air-traffic control facilities still use paper strips to keep track of the flights.

The airlines have long complained that flight times are getting longer. In 1990, for instance, a 236-mile flight from Las Vegas to Los Angeles took 59 minutes. In 2015, the advertised flight time was 70 minutes, according to the trade group.

Since Mr. Trump’s election, airlines and airports have said they are optimistic about his plans to lower taxes and raise infrastructure spending. But it isn’t yet clear how those policies would be implemented.

Air-traffic Modernization efforts have been slow-moving and over budget, many federal watchdogs have concluded. And the U.S. has been slow to adopt new technologies, like using satellites to guide planes.

In a statement, a FAA spokeswoman said air-traffic control modernization already has yielded economic benefits and is expected to produce more. She said the agency has spent $7.5 billion on the initiative since 2010, which “has resulted in $2.7 billion in benefits to passengers and the airlines to date, and is expected to yield more than $160 billion in benefits through 2030.”

Calling the ongoing effort one of the most ambitious infrastructure projects in history, the FAA also said it has invited airlines to “help develop the blueprint” and to “continue to have a seat at the table” in setting priorities.

Many airlines have in the past supported a plan to remove air-traffic-control operations from the FAA and place them into a not-for-profit corporation, arguing it would allow that company to raise funding from the financial markets, rather than relying on congressional appropriations. But this move has been thwarted in the past, mostly recently last year when it faced objections by the FAA, the Senate Republican leadership and business-jet and private pilot groups.

The FAA’s mandate is set to run out in September, providing an opening to discuss such changes as part of its reauthorization by Congress, which has Republican majorities in both chambers.

“The president recognizes that there needs to be a modernization of air-traffic control,” a senior administration official said. “It’s a decades-old system, and he recognizes that there needs to be a serious investment in that.”

The president told the gathering that he has asked White House economic adviser Gary Cohn with putting together a group to look into air-traffic-control modernization, according to Ginger Evans, commissioner of the Chicago Department of Aviation, which runs the city’s O’Hare International and Midway airports. Mr. Trump also asked the airlines and airports to provide lists of regulations that should be removed, and indicated he wanted to meet them again in two or three months.

Commercial aviation was deregulated nearly four decades ago. But airlines are subject to more than 13,000 regulations across 13 federal agencies just in the U.S. They also are subject to 17 federal aviation taxes that are paid by airlines and their passengers. These taxes grew to $23.1 billion in 2016 from $3.7 billion in 1990, according to the trade group.

Contentious issues such as the administration’s travel ban barring citizens of seven nations from entering the U.S., didn’t come up, according to people who attended the meeting.

Also not discussed during the meeting, which lasted more than an hour, was controversy over Norwegian Air Shuttle ASA, a European discount carrier awarded a permit in December by the Obama administration to operate to the U.S. from Ireland, through a subsidiary. U.S. unions say the Irish base allows Norwegian to hire pilots and other employees on less generous terms than they would receive under Norway’s strict labor laws.

The airline denies that. Norwegian says it is hiring U.S.-based pilots and flight attendants to support its expansion and expected to have 1,000 U.S.-based staff by the end of the year.

There was a brief discussion about the controversy around alleged subsidies to three fast-growing, state-owned Middle Eastern carriers, according to people at the meeting. “I know you’re under pressure from a lot of foreign elements and foreign carriers,” Mr. Trump said. “I’ve been hearing that a little bit. At the same time, we want to make life good for them also. They come with big investments.”

During the meeting, Mr. Trump ticked off a list of airport terminals he liked—Doha, Dubai, Singapore, Shanghai and Munich—according to Ms. Evans of Chicago. Kevin Burke, CEO of Airports Council International—North America, a trade group, who also was present, said: “He wasn’t terribly complimentary about the state of U.S. airports.”

—Andy Pasztor and Doug Cameron contributed to this article.

Original article and video can be found here:  https://www.wsj.com

No comments: