FAA Proposes Extending Slot Waivers, but Not All Airlines Are Happy

The Federal Aviation Administration (FAA) is proposing to extend its slot-use wavier at Washington Reagan National, LaGuardia, and John F. Kennedy International Airport, through March 27, 2021, the end of the winter scheduling season. The proposal, which is open for comments, is not without controversy, however.

The three airports are slot-constrained, which means the FAA limits the number of take-off and landing-periods, or "slot pairs." This has made slots at the three airports highly coveted assets, with airlines forced to divest slots after mergers to prevent one airline from cornering the market. Smaller airlines and new entrants have long complained that incumbents have an unfair advantage at three of the country's most lucrative airports.

Slots are governed by a use-it-or-lose-it rule that requires airlines to operate flights 80% of the time or risk losing their slots. When the Covid pandemic struck, FAA waived this requirement to prevent airlines from flying empty aircraft simply to keep their slots. The initial waiver ran through May 31, but FAA extended it through Oct. 24. Now, after several airlines, including United, Delta, and American, and trade groups like Airlines for America and IATA have urged it to extend the waiver further, FAA is proposing to suspend the rules through March 27.

Airlines with large operations at the three airports have lauded the extensions. With schedules in flux as demand remains uncertain, airlines say they need the extra flexibility to rework their networks to match passenger traffic. But they want to retain the slots for when demand ultimately returns.

But Airports Council International-North America (ACI-NA) objected to the initial extension and has opposed further waivers, the FAA said in its filing. The group says extending waivers will distort competition and raise prices, and could limit the viability of airports to serve their communities.

Spirit Airlines also objected, arguing that the waiver gives incumbent carriers the right to squat on valuable slots, shutting out airlines that potentially could operate them. Spirit further argued that demand is returning, making the waivers less necessary now, FAA said. Allegiant concurred with both ACI-NA and Spirit. Southwest, on the other hand, was more measured, asking FAA to limit the waiver to Dec. 31.

Although FAA acted quickly to waive slot rules, Europe did not. The issue gained attention earlier this year when European airlines flew empty aircraft to slot-constrained airports, like Amsterdam, to keep their slots. The EU ended up waiving the rules. This week, the EU extended its slot-use waiver through March 27, 2021.