FAA Lets Airlines Keep New York Airport Slots Without Flying, Blocking Competition Another Year

The FAA granted the airline industry lobby group’s request to let carriers keep their current exclusive rights to fly at New York airports without actually offering flights to passengers for another year. In a new order issued for New York JFK and LaGuardia and for Newark issued on Thursday:

• Airlines don’t actually have to use their slots at New York JFK or LaGuardia through October 30, 2027 in order to keep them.

• Newark’s ‘slot-like’ waivers were also extended through October 30, 2027.

• There’s also a waiver for slots at Washington’s National airport for flights affected by these waivers.

• And in related orders, the underlying slot control regimes at JFK and LaGuardia were extended through October 28, 2028.

For Winter 2026 – 2027 and Summer 2027, airlines can return up to 10% of their slots at New York JFK and New York LaGuardia and the FAA will treat them as having been used (so the slots aren’t subject to ‘use it or lose it’ rules). Normally an airline has to use 80% of its slots to keep them all. This reduces the threshold to 70%.

The FAA asks for slots during JFK’s 1 p.m. – 10:59 p.m. period and New York LaGuardia’s 1 p.m. – 9:59 p.m. delay peak periods but does not require this. It “expects” use of larger planes and preservation of regional service, but neither is required. Incumbent airlines retain their future rights to fly, and to exclude other airlines from offering flights, and no other airline can use the abandoned capacity even temporarily.

The FAA’s Justification

Air traffic control is understaffed, as it has been for decades. They say that New York TRACON (approach control) won’t reach required minimum capacity until after 2027. The FAA has failed across several dimensions, with antiquated technology that it’s been unable to upgrade despite billions of dollars and decades spent on the effort. And union gaming of overtime has meant that New York TRACON refuses to certify new controller to game overtime rules.

That’s the underlying excuse to limiting flights at New York JFK and LaGuardia. For Newark, the claim is that the fixes to problems at New York TRACON haven’t worked ‘yet’.

How Newark Limits Work

Newark isn’t slot controlled. It’s an IATA Level 2 schedule-facilitated airport (a change put in place October 30, 2016). There are no formal slots or 80% slot usage rule there. Instead, it approves timings and gives next-season priority to previously operated schedules.

The FAA has effectively created a temporary, slot-like regime:

• 36 arrivals and 36 departures per hour, 6 a.m. – 10:59 p.m.
  
• Airline-specific authorized timings allocated proportionally based on existing operations (i.e. United gets the bulk of the airport)
  
• Written FAA approval is required for timing changes and swaps.
  
• Existing carriers retain historical priority.
  
• Another 10% may be returned and treated as operated, including Newark – Washington National. Unlike New York JFK and LaGuardia, FAA may reallocate these temporarily (which suggests the underlying issue isn’t too much air traffic at Newark, just giving United what it wants)

Newark had slot controls from 2008 to 2016. At the end of this regime, United controlled 902 of 1,233 slots (73%).

The N90 facility on Long Island no longer handles Newark. It was transferred to Philadelphia TRACON in July 2024. But the FAA says Newark sector staffing at Philadelphia TRACON is still inadequate.

United overschedules Newark to keep out Newark competition. Now it can keep out competition without as much flying.

Slot Waivers Have Been In Place For Nearly All Of The Last Six Years

COVID slot waivers began March 16, 2020 and lasted through October 29, 2022. Ordinary ‘use 80% or give up unused slots’ rules resumed October 30, 2022.

Then the waivers justified by air traffic control staffing (not a new issue) began May 15, 2023 and have been continually extended, through through Summer 2027.

The Biden administration broke up the JetBlue – American Airlines partnership because they were concerned with competition in New York, and didn’t want competitors colluding. But the administration was more interested in keeping competition out of New York than ensuring it, and the current administration has gone along with airline collusion in the New York market.

Who Gets To Fly At These Airports

Here are the slots actually operated by airline for summer 2025. That’s different than slot allocations. The largest difference is that United Airlines actually holds 47 slots at New York JFK. These were leased permanently to Delta in 2015.

LGA	Airline	Slots	Share
1	Delta Air Lines	580	50.5%
2	American Airlines	327	28.5%
3	Southwest Airlines	70	6.1%
4	United Airlines	67	5.8%
5	Air Canada	35	3.0%
6	JetBlue Airways	31	2.7%
7	Spirit Airlines	22	1.9%
8	Frontier Airlines	10	0.9%
9	Porter Airlines	6	0.5%
	Total	1,148	100.0%

 

DCA	Airline	Slots	Share
1	American Airlines	531	59.3%
2	Delta Air Lines	114	12.7%
3	Southwest Airlines	92	10.3%
4	United Airlines	77	8.6%
5	JetBlue Airways	40	4.5%
6	Air Canada	16	1.8%
7	Alaska Airlines	12	1.3%
8	Republic Airways	8	0.9%
9	Frontier Airlines	6	0.7%
	Total	896	100.0%

 

For New York JFK, here are airlines with at least 10 slots (nearly 80 airlines operated fewer than 10 slots).

JFK	Airline	Slots	Share
1	Delta Air Lines	492	30.5%
2	JetBlue Airways	360	22.3%
3	American Airlines	195	12.1%
4	Alaska Airlines	26	1.6%
5	UPS	23	1.4%
6	Cathay Pacific Airways	20	1.2%
7	Frontier Airlines	19	1.2%
8	British Airways	17	1.1%
9	ACE Belgium Freighters	17	1.1%
10	Caribbean Airlines	14	0.9%
11	Qatar Airways	14	0.9%
12	Korean Air Lines	13	0.8%
13	Virgin Atlantic Airways	13	0.8%
14	Air France	12	0.7%
15	Avianca	12	0.7%
16	FedEx	12	0.7%
17	Turkish Airlines	12	0.7%
18	ABX Air	10	0.6%
19	Air Canada	10	0.6%
20	China Southern Airlines	10	0.6%
21	Flair Air	10	0.6%

Research Suggests That Slot Controls Don’t Even Reduce Delays

Alexander Luttmann at UC Irvine suggests that slot controls don’t actually reduce delays at congested airports because large airlines at major airports “already internalize congestion” when planning their schedules.

That makes sense. Airports are also constrained by terminal and gate space, not just slots. Heavily congested airports take longer to get planes in and out. Flight times are longer. That means flights are more expensive – they take up more aircraft time and airlines have to pay their crews more, too. Airports are also constrained by terminal and gate space, not just slots.

While the busiest airports see plenty of flights, their largest airlines don’t just keep adding flights because that’s expensive, both for the new flights and for all of their existing flights which suffer greater delays and ultimately get longer flight times.

Newark and New York JFK airports had slot controls re-introduced in 2008.

• Following the introduction of slot controls “the average arrival delay at EWR actually increased by 7 minutes”
  
• Delta compressed their schedule at New York JFK (“the length of Delta’s departure banks…decreased by about 2 minutes at JFK”) offsetting gains from slot controls.

Slots Are Government Subsidies To Incumbent Airlines

Slot waivers let incumbent airlines keep their exclusive rights at an airport without even using them for consumer benefits. They drive up airfares and limit flight options.

Slots block competitors and future new entrants, as a free gift (subsidy) from taxpayers. Slots are the right to take off and land at an airport, generally given free, with huge economic value. Slot controls allow incumbents exclusivity and block anyone else from competing with that. The fact that airlines have succeeeded in regulatory capture to make this a standard practice doesn’t make it any less bad policy.

A Better Way To Manage Airport Capacity

Slots are a blunt rationing instrument. When ‘use it or lose it’ rules are in effect we get unnecessary flying on small planes no one wants to fly, just to squat on flight times. Prices encourage airlines to allocate flights on the right aircraft to the right routes that match passenger demand. Congestion pricing is a better approach.

Think of a runway like a heavily used road approaching its capacity. As use approaches 100% of capacity, planes have to queue. Each additional flight imposes delay costs on everyone else, but the airline only internalizes its own delay cost. So airlines are incentivized to overschedule.

Slots try to deal with this by capping the number of flights in a period. Congestion pricing says instead: “You can operate whenever you like, but you must pay the actual total cost of the delay you impose on others.”

Slots are a crude cap: “X movements per hour.” They’re allocated via grandfather rights and use it or lose it. They’re adjusted infrequently and administratively. Once you have the slot, the flight becomes ‘free’ regardless of the delay it causes.

Charging per flight movement that approximates the marginal delay cost to others works better. When the system is uncongested, the price is low or zero. As demand approaches or exceeds capacity, prices rise sharply.

Airlines operate a flight in that time slice if they are willing to pay – if the value of the flight to passengers and the airline is greater than the congestion charge.

That way, you get the flights that generate the highest value relative to the delay they cause. You also get natural spreading of flights to shoulders or off-peak times, reducing congestion, in order to lower costs. It can encourage use of larger aircraft to spread the cost out across more passengers, and also de-banking of hubs.

A slot freezes peak delay – a “19 slots per hour” rule means you get 19 flights per hour, regardless of delay and irrespective of whether those are 19 regional jets or widebodies. There’s no incentive to move those any of those flights 20 minutes to spread out peak loads.

Slots are also bad at handling weather events and air traffic control issues. Those might reduce an airport’s capacity from (say) 60 to 35 flights per hour. That’s when we get ground delay programs and ad hoc rationing. Congestion pricing can do the work for you, and prioritize the most valuable flights. Instead of stressing the system, airlines contribute towards paying for a better one. (If you want to make it revenue-neutral, cut landing fees or passenger charges to offset and just use congestion pricing for the incentives.)

Ultimately, the same price applies to everyone – incumbent airline or new entrant in the market.

Airlines Would Hate This!

The FAA just handed the airline lobby what it wanted – the ability to keep its government subsidy without even having to operate flights, justified by the government’s own failure to manage air traffic control effectively. Airlines are getting a valuable property right for free, which limits flights and raises fares. With congestion pricing they would instead they’d be charged (though it could be made revenue-neutral).

You’ll likely hear that ‘congestion fees will just cement incumbent dominance’ which is silly, because that’s what the current slot system does. The claim, though, is that incumbents have deep pockets to pay peak charges, while others get pushed out worsening competition.

• Under slots, incumbents own peak access for free (or were often cheaply acquired in the past). They can sit on grandfathered rights indefinitely. New entrants are often shut out completely.

• If a new entrant sees high value in a particular peak flight, they can buy in. Under a fixed slot regime, there may literally be no access at any price.

• If policymakers still want to support entry (they will, usually for their own constituents rather than the public good), they can offer rebates for new carriers on specific routes and use competition policy to scrutinize predatory practices rather than locking in those practices with slots.

There will also be a class argument that peak times will become ‘rich people’s time slots’ with lower-income travelers getting pushed into inconvenient off-peak times or other airports. That’s often what happens now, getting pushed to Frontier for lower fares. And lower-income travelers would face fewer delays!

In any case, especially if congestion pricing encourages upgauging, we’ll likely see more major carriers with excess capacity to discount – at peak times. But if you want redistribution, then do it explicitly, not via hidden cross-subsidies embedded in slot allocation.

What is a fair concern is that low value flights that few passengers value – often on smaller regional jets to low volume airports – will lose peak time service. That’s because these flights are less valuable! But if we’re really going to design policy around these flights, don’t do it in a way that also inefficiently allocates flights causing delays for the entire air system. Make the subsidy cost of these flights explicit rather than burying it.

A system that sets prices by day and time seasonally, by 15 or 30 minute increments and published in advance is easy for airlines to plan around. Then major weather or air traffic control outages can have surge pricing with a capped multiper (e.g. 2x). This is easy for airlines to deal with – they manage variable fuel pricing and demand risk constantly, there’s nothing unique about this and it will lower airline costs from ground delays.