AirTran Airways, American Airlines, Delta Air Lines, Northwest Airlines, United Airlines, and US Airways

FAA-2008-0656 - Request for Waiver of Minimum Slot Usage Requirement

May 8, 2008

Request of AirTran, American, Delta, Northwest, United and US Airways for Waiver of Slot Usage Requirement

The recent spike in fuel prices has created a highly unusual and unpredictable condition that is beyond the control of the carriers arid will affect the airlines for some time to come, thereby providing good cause for the requested waiver.

While carriers are doing all that they can individually to adjust for the current market environment throughout their networks - including network management, fuel conservation initiatives and other cash preservation efforts - there is the very real prospect that carriers will be unable to adjust fully for changes in fuel prices and demand patterns at airports subject to federal caps when combined with a use or lose regulation.

Aside from assisting carriers at this critical time, a suspension of the use or lose regulations likely would also have a positive impact on DOT/FAA efforts to reduce congestion and delay nationwide, but in particular in the New York region. With all three major New York‑area airports now capped for congestion reduction purposes, a temporary suspension would allow additional flexibility for carriers to adjust schedules that could further reduce congestion on the ground, in the air, and throughout the national air transportation system. The benefits of this include reduced delay for consumers, both in the air and on the ground. At the same time, this could also benefit airlines through more efficient operations that would require less costly fuel burn leading to reduced emissions and a positive impact on the environment.

The carriers seeking this waiver are not opposed to permitting other airlines to add incremental flying in slots where the historical slot holder has temporarily withdrawn service as a result of any relief granted by FAA. Of course, any operating rights temporarily transferred should only be permitted to be scheduled or operated concurrent with any waiver from the applicable regulations or orders (See Footnote 1). In addition, no historical incumbent rights would attach to the temporary operation of the slots by an operator that is not currently a holder of the slots.

By: AirTran, American, Delta, Northwest, United and US Airways

June 5, 2008

Opposition of Virgin America to Request for Waiver of Minimum Slot Usage Requirements

We respectfully oppose the May 8, 2008 petition of American Airlines, Delta Air Lines, Northwest Airlines, United Airlines, AirTran Airways, and US Airways, to waive current and proposed minimum slot usage requirements for the entire Winter 2008/2009 season at DCA, EWR, JFK, LGA, and ORD because of an increase in fuel prices. For the following reasons, Virgin America submits that the Joint Carriers’ request is anti-consumer, contrary to precedent, and without merit. Accordingly, it should be denied.

The steady and protracted increase in fuel prices over the past sixteen months does not justify wholesale waivers of slot minimum usage requirements at five of the most important, high-demand airports in the country, over an entire Winter season. Already, the large percentages of relatively small aircraft operations at these highly congested airports represents a waste of scarce assets. To permit these Joint Carriers to officially retain their slots, when excess demand exists from carriers like Virgin America, would be arbitrary and capricious, inconsistent with the waiver standard and precedent, and bad public policy.

Counsel: Pillsbury Winthrop, Kenneth Quinn, 202-663-8898

June 9, 2008

Re: Letter of Air Transport Association in Support of Waiver of Minimum Slot Usage Requirement

The Air Transport Association supports the temporary waiver of minimum slot usage requirements for the Winter 2008/2009 season, as requested by letter dated May 8, 2008 from ATA members AirTran Airways, American Airlines, Delta Air Lines, Northwest Airlines, United Airlines and US Airways.

The need to comply with minimum use requirements, also known as “use-it-or-lose-it” rules, at slot-controlled airports (or airports that the Department of Transportation has proposed subjecting to operating restrictions) could skew service decisions, and even impede the necessary process of finding a rational mix of service and markets to meet the new reality of sharply higher operating costs. As was the case in the months following the terrorist attacks of 9/11, airlines serving these airports need a brief period to assess the longer-term trends in the industry and adjust their schedules and service accordingly.

The request for a temporary blanket waiver for the Winter 2008-2009 season (roughly through March, 2009) would allow the affected airlines to focus on long-term stabilization. A stable, financially sound U.S. airline industry serves the interests of the traveling and shipping public by providing the critical air transportation services that drive approximately 10% of GDP and that knit our country together. The joint temporary waiver request will provide a brief respite from what has become an unexpected an extraordinary disruption of the industry, and should not be interpreted as a means of shielding noncompliance with slot use requirements prior to the time the waiver is granted. Moreover, the carriers requesting the waiver have stated that they are not opposed to the temporary transfer of slots that are not used by their holder to other operators for the term of the waiver. Within those parameters, such a waiver would not harm the interests of other airlines or the public

Counsel: ATA, David Berg, 202-626-4234

June 13, 2008

Re: Joint Carrier Response to Virgin America

Rapidly rising fuel prices have now become an economic calamity affecting the airline industry and all other segments of the U.S. economy. Indeed, it was only after jet fuel had risen by over 32 percent in approximately four months that the Joint Carriers sought relief. The Joint Carriers understand that the applicable regulations are to be invoked only sparingly, but current circumstances certainly compel relief. Carriers need the flexibility to respond to the immediate fuel price crisis without jeopardizing routes that are of long term importance to their networks and the communities served.

VX claims that the Joint Carriers fail to satisfy any of the reasons cited in the applicable regulations or prior precedents (notably post-9/11) for issuance of a waiver. However, VX' s overly narrow interpretation suggests that the only airport where a waiver should have applied after 9/11 would have been at DCA and even then only for the duration of that airport's closure.

Yet VX admits such an interpretation would be too restrictive, and that a more expansive waiver after 9/11 was justified to permit the "aviation industry [to] adjust to the changing aviation environment." Such is the case here. The industry is in disequilibrium and needs time to adjust to a rapidly changing environment driven by record high fuel prices and extreme volatility.

No loss in competition will result from the grant of this temporary waiver request. The Carriers were unambiguous in declaring that any slots not operated during the waiver period could be used by other carriers seeking to increase service at any of the airports. If an incumbent carrier drops service at JFK, VX or any other carrier could step in and operate the slots for the duration of the waiver period.

The airline industry is, and will remain, intensely competitive. Congress's mandate of "maximum reliance on competitive market forces and on actual and potential competition" has been fully met. However, this is just one of many policy directives that Congress has instructed DOT to follow when setting policy. All of them combined go to ensuring a strong and vibrant airline industry. A short-term exemption from the use or lose rules is in no way contrary to any of the Congressional directives - and indeed is fully consistent with DOT and FAA policy and precedent in similar exigent circumstances. 

By: AirTran, American, Delta, Northwest, United and US Airways

June 13, 2008

Re: National Air Carrier Association in Opposition

Every carrier is facing tremendous challenges. The current economic condition of the U.S. commercial aviation industry has tremendous ramifications for the U.S. domestic economy. The agency should carefully weigh the carriers' waiver petition in light of the other regulatory actions it is proposing for these airports as well as the overall financial condition of the industry.

In our view, the agency should examine the regulatory and administrative burdens that apply to all commercial service carriers. Almost every aviation analyst suggests that the industry is confronting a crisis heretofore not seen before and could potentially be far more damaging than the aftermath of the September 2001 terrorist attacks. In light of the dramatic changes and challenges confronting the industry, we believe it would be prudent for the agency to convene a meeting of the carriers to discuss the current economic situation and develop a consensus approach to broader regulatory or administrative reforms.

By: NACA, Thomas Zoeller, 703-358-8060

June 20, 2008

Re: Opposition Letter of the Metropolitan Washington Airports Authority

To be clear, the Airports Authority takes no position regarding slot usage waivers at other congested airports, nor are we expressing a view as to which airlines should operate slots at Reagan National, or how unused or returned slots should be allocated. We simply believe that slots represent important and scarce public assets, and that if an air carrier does not use the slots for the requisite percentage and time period, they should be reclaimed by the Federal Aviation Administration and made available pursuant to existing rules for distribution to air carriers that wish to launch or expand service at the Airport. Furthermore, to let unused or underutilized slots lay dormant would increase financial burdens on other carriers serving Reagan National, harm our community and the traveling public, waste valuable landing rights, and have significant anti-competitive effects on the airline industry.

Airline landing fees resulting from optimal slot usage are key to the Airports Authority's overall financing and capital development program. At Reagan National, reductions in the collections of landing fees as a result ofunderutilization by one carrier, will have direct and indirect impacts on the other carriers, as such reductions will necessarily result in shifting more of the financial burden associated with the airfield to the remaining airfield users. For air service, Reagan National enjoys strong consumer demand from our community and around the country. Those wishing to travel to and from Reagan National should not be penalized by special waivers for carriers that are unwilling or unable to provide the service.

By: MWAA, James Bennett

June 25, 2008

Re: Air Carrier Association of America Letter in Support

The Air Carrier Association of America supports the temporary waiver of minimum slot usage requirements for the Winter 2008/2009 season, as requested by letter dated May 8, 2008 from a number of airlines for operations at various airports, particularly Ronald Reagan Washington National Airport and LaGuardia International Airport. We support the request for a waiver through the end of the winter 2008/2009 season. The waiver would expire on April 1, 2009.

In the past, the ACAA might not have supported this request. This environment is much different than those faced historically. Unless steps are taken quickly to allow carriers to adapt, the only option left is to incur high losses or forgo future service in critical airports. This is the sort of service that has created multiple flight options and promoted travel, tourism and economic development. It is now prudent to support the limited waiver of slot usage requirements for the period through April 1, 2009, rather than risk the loss of valuable service over the longer term.

If there is a concern that carriers might stop operating large numbers of flights, the ACAA would not object to a limit on the number of slots that can be subject to this slot waiver. The FAA could place a limit on the number of slots subject to the waiver for each carrier to no more than four slots or 20% of the carrier's total slot holdings at that airport, whichever is greater but not to exceed a total of 20 slots per carrier at each airport. Moreover, each carrier would have to assure the FAA that it will resume use of each slot by April 1, 2009 or it would lose the slots.

Counsel: ACAA, Edward Faberman, 202-719-7420

June 27, 2008

Comments of the Port Authority of New York and New Jersey

PANYNJ opposes the request by certain air carriers to waive the minimum slot usage requirements at LaGuardia, JFK and Newark Liberty airports. Although we understand and are sympathetic to the financial challenges faced by the airline industry in light of significantly rising fuel costs and weakening economic conditions, the Port Authority is very concerned that granting the request for a waiver for the Winter 2008/2009 period would not be in the public interest, would negatively impact the New York-New Jersey economy, and would undermine efforts to promote airline competition. As such, we believe that any underutilized slots at the three Port Authority airports should be made available under existing rules for administrative allocation to other carriers wishing to serve or add service to the New York region.

By: PANYNJ, William DeCota

July 3, 2008

Re: FAA Letter to American Airlines

The FAA has determined that the present circumstances do not constitute the type of highly unusual and unpredictable condition envisioned in the applicable regulations and orders. The specific examples generally cited for such an instance include weather conditions that restrict the operation of an airport, as well as the grounding of a particular aircraft type. In addition, as you observe in your letters, the FAA approved a temporary waiver of the minimum usage requirements after September 11, 2001, in order to permit the airlines, airports, and public to adapt to new security requirements. We do not intend to minimize the effect that increased aviation fuel prices have on the aviation industry; nor do we diminish the importance of their rapid and continuing rise. However, this circumstance does not equate to severe weather that closes an airport for several days, to a mechanical problem that grounds a particular aircraft type, or to the practical effect of an unprecedented terrorist attack.

This determination does not leave airlines without recourse. These operations involve the most highly coveted operating authority in the United States. In the event that any air carrier does not intend to use the authority itself, there is a secondary market at each of the affected airports, permitting air carriers to lease the operating rights to another carrier for a period of time. In this way, air carriers can recoup the market value of the operating authority and retain the flexibility to resume service upon the expiration of the leasehold interest. This option would continue to promote competition, whereas a simple suspension of minimum usage requirements would ultimately result in decreased service and higher fares for the flying public.

We also anticipate a series of operational improvements, such as Area Navigation (RNAV), Required Navigation Performance, and Continuous Descent Approaches, will continue to reduce unnecessary fuel usage. The recent expansion of routes in the western Atlantic airspace will also provide more efficient routing. In addition, the Acting Administrator has asked the Air Traffic Management Steering Group to convene an airline fuel forum on July 17 to discuss air traffic management initiatives to enhance fuel efficiency. Finally, as previously noted, the FAA is lifting the cap on operations at O'Hare International Airport, so the minimum usage rules will no longer apply there.

An identical letter is being sent to each of your letter's co‑signers, and we will file a copy of this letter in the public docket for this matter.

By: Kerry Long

July 21, 2008

Re: Request of AirTran Airways for Expedited Short-Term Waiver at LGA

AirTran Airways hereby requests that the Federal Aviation Administration approve an expedited short-term waiver from the "use-or-Iose" slot requirements for its operations at LaGuardia Airport. AirTran currently holds twenty-four slots and is temporarily utilizing a few slots held by other carriers. AirTran's request is based upon significant facility issues at LaGuardia Airport. Therefore, AirTran requests immediate approval (by July 25, 2008) of a waiver from the minimum slot usage requirement] at LaGuardia for September and October, 2008 for four LGA slots.

The waiver request for September and October, 2008 is for slot numbers 4344,4358,4361, and 3885. This request is based upon structural problems with the gates that AirTran utilizes at LGA that are maintained by the Port Authority. Some of the jet bridges utilized at LGA by AirTran (and other carriers) have had significant structural problems. One of the jetways utilized by AirTran was B5. Several months ago, B5 split in half while passengers were boarding a JetBlue flight. AirTran also utilizes B7. Subsequently, the jetway at B5 and B7 were deemed unsafe for extended operation. B5 could not be utilized after the collapse involving the JetBlue flight, and, while there is a rehabilitated jetway on B5 now, it is not back in service yet. After B5 is returned to service over the next 30-60 days, B7 will be taken out of service. New pilings are required at B7, which means it could be out of service through October. The Port Authority will not return these bridges to full service until they are sure that they meet all safety requirements.

If AirTran held hundreds of slots, it would have options to protect the slots from the use or lose requirements; however, with only twenty-four slots, AirTran does not have the "use" options available to larger slot holders.

Counsel: Wiley Rein, Edward Faberman

Re: Request of AirTran for Reduction of Slots in Question from Four to Three

AirTran continues to monitor the LGA operations. After reviewing all of its flights at LGA, they were able to modify operations and eliminate one flight. As a result, AirTran reduces its waiver request from four to the following three slots slot numbers 4318, 3569 and 4348.

Therefore, AirTran Airways hereby requests that the FAA grant it an expedited waiver from the use-or-lose provisions at LaGuardia International Airport for three slots for September/October, 2008, AirTran requests that the September request be approved by July 25.

Counsel: Wiley Rein, Edward Faberman

July 24, 2008

Re: Letter of Gate Clarification of Port Authority of New York and New Jersey

Gate B5 at LaGuardia Airport is scheduled to be returned to service as of July 25, 2008, after replacement of the jet bridge serving that gate. Approximately one week later, Gate B7 is scheduled to be taken out service for a period of approximately 60 days, during which time a replacement jet bridge for that gate will be installed. During this period, AirTran Airways operations which had theretofore been using Gate B7 will be relocated to Gate B5.

Counsel: PANYNJ, Arnold Kolikoff, 212-435-3451

July 25, 2008

Re: Response of US Airways to Request of AirTran

If AirTran intends to base its request solely on its forecasted operational problems during the low-traffic months of September and October, US Airways would be surprised to see the FAA grant a special request to AirTran given the facts as presented; particularly, after the recent denial by your office of the broader industry request.

US Airways fully supports AirTran's request to the extent that it would be extended to all carriers to address congestion, fuel prices and the annual LGA runway construction. As for the other factors AirTrans cites in support of its request, the facts, as known at this time, do not meet the regulatory threshold necessary to grant such a request.

Counsel: US Airways, Howard Kass

July 25, 2008

Re: Response of jetBlue to Request of AirTran

This letter responds to the July 21, 2008 letter of AirTran Airways in which AirTran requested that the Federal Aviation Administration approve an expedited waiver of the minimum slot usage requirements for its operations at LaGuardia Airport. JetBlue Airways Corporation opposes AirTran's request. The "structural problems" that AirTran claims affect the gates it uses at LGA are the same structural problems on gates that JetBlue uses and have been in existence and dealt with by JetBlue and AirTran since February of this year. In fact, as AirTran notes, when Gate B5 split in half in February 2008, it was while passengers were boarding a JetBlue flight. Yet JetBlue has continued its service without interruption at LGA, and JetBlue has not and does not intend to request a waiver of the minimum slot usage requirements for its operations at LGA. Indeed, no other carrier that uses those same gates has found it necessary to ever request such a waiver.

Accordingly, JetBlue respectfully requests that the FAA deny AirTran's request for an expedited waiver of the minimum slot usage requirements applicable to its operations at LGA in September/October 2008 based on the infrastructure issues raised by AirTran.

Counsel: Dow Lohnes, Jonathan Hill, 202-776-2725

July 28, 2008

Re: Follow-Up Letter of AirTran

This is a follow-up to my letters of June 21 and June 24 asking the agency to approve a short-term waiver (September/October 2008) ofthe slot use requirements for AirTran Airways for three LaGuardia slots (4318, 3569, and 4348). This letter supplements the information previously provided to you.

The issue AirTran Airways now faces is the loss of one of its jet ways on the B concourse for approximately 60 days. The replacement of the jet way at gate B5 is nearing completion and the replacement of the jet way at gate B7 is scheduled to begin within the next two weeks. This is not a simple task because new pilings must be installed along with a new base for the jet way. Since B7 is one of AirTran's gates, it will be impacted more than other airlines on the B concourse. Adding to the impact on AirTran is the fact that it has more operations and handles more passengers on the B concourse than the other Concourse B carriers. AirTran Airways has the highest utilization of jet ways amongst all carriers at LaGuardia.

While B7 is replaced, AirTran will utilize gates B8, B5, and B4. Gates B5 and B4 are the Port's common gates. Rather than dealing with gates next to each other, for September and October AirTran's tenninal and ground crews will have to move between gates spread out around the tenninal. Moreover, the hold rooms at B4 and B5 have much less passenger seating than B7. As a result, a large number of passengers will be impacted. All of these changes will impact AirTran's operations through October.

By allowing the waiver, the FAA will help avoid ground delays that will be more significant than those faced with the closure of 85. The impacts created by the repair work on B7 will impact AirTran more than all other Concourse B carriers. By allowing the waiver, the impact on AirTran's operations will not be as great if it has to operate all of its flights. In addition, it will also reduce impact on passengers in the terminals.

Counsel: Wiley Rein, Edward Faberman, 202-719-7402

July 30, 2008

Re: JetBlue Airways Response to AirTran Airways Letter Dated July 28, 2008

First, AirTran describes problems with "jetbridge A5," see Follow-Up Letter at 1, but AirTran does not operate from Concourse A. In fact, Gate A5 belongs to Air Canada and is subleased by JetBlue. Thus, AirTran's claim that it has been impacted by Gate A5 is false. To the extent that AirTran intended to refer to Gate B5, AirTran, as JetBlue indicated in its first letter, has not been impacted by the repairs on Gate B5 any more than the other carriers that utilize that gate.

Second, as AirTran notes, it leases Gates B7 and B8 in Concourse B, and also uses the Port Authority-controlled Gates B4 and B5, so it has had and continues to have ample gate alternatives to use for its flights during repairs to certain gates by the Port Authority. Indeed, while the Port Authority repairs Gate B7 over the next 60 days, AirTran will have access to Gates B4 and B5, which will allow AirTran to operate as normal, provided that their flights are operating on schedule.

Third, although AirTran claims that it deserves a waiver ofthe minimum slot usage requirement because "AirTran's terminal and ground crews will have to move between gates spread out around the terminal," Follow-Up Letter at 2, this is misleading. All of AirTran's gates at LGA will be in the same concourse - Concourse B - so this will not be much of an inconvenience and certainly no more of an inconvenience than other carriers will experience. AirTran's operations should not be negatively impacted from having all of its gates in the same concourse; that is an advantage that it does not enjoy in several other cities, so AirTran is hardpressed to claim that it constitutes a disadvantage at LGA. Indeed, by AirTran's logic, it should be granted a waiver of the minimum slot usage requirement even if Gate B7 were fully functional during that time, because AirTran still would be using only gates in Concourse B. This argument makes no sense. AirTran operates flights from different concourses at airports in other cities around the country, such as Boston (where AirTran voluntarily operates from gates located in two separate concourses, and does not appear to have any problems doing so), and it is not complaining about its gate locations in those cities. Moreover, JetBlue regularly operates flights from gates in multiple concourses at LGA (currently, JetBlue routinely operates flights from gates in Concourses A and B, with occasional operations from Concourse C), yet it is not using this reality of operations at LGA to seek relief, nor should it be a basis for granting the relief sought by AirTran.

Finally, with regard to AirTran's claim that it will be more impacted by the loss of Gate B7 than any other airline, this is also unfounded. Several airlines, including JetBlue, were negatively impacted when the Port Authority took Gate B5 out of operation for repairs. AirTran provides no support for its claim that the impact it will feel from the loss of use of Gate B7 for 60 days is greater than the impact felt by other airlines from the loss of use of Gate B5 for several months.

Counsel: Dow Lohnes, JOnathan Hill, 202-776-2725