New York LaGuardia, New York JFK and Washington National airports are ‘slot controlled’. That means there are limits on the number of takeoffs and landings at each airport, and the right to use those have been given (free!) to incumbent airlines as a property right. That’s a huge subsidy to incumbent carriers.
Normally slots come with ‘use it or lose it’ rules. If an airline doesn’t make use of their slots 80% of the time, those slots can be reassigned to another carrier. As a result you’ll see airlines flying more or less ghost flights, service designed to hold the slot rather than meet any economic need. American Airlines, for instance, used to throw 50 seat regional jets on New York JFK – Baltimore which is one of the cheapest ways to hold slots.
During the pandemic the FAA (along with other agencies around the world) waived normal use requirements for slots, with some minor differences in detail. They let airlines keep their slots without actually flying. Governments should be leasing slots for 10 year periods, and then bidding them out again.
The FAA has said that starting November 1 they’re only extending the use waiver on slots (through March 26, 2022) for “slots and approved operating times used by any carrier for international operations only” – in other words, they have to use domestic slots again, or lose them.
As a result last week Delta announced 100 additional New York JFK and New York LaGuadia deparures that will be in place by… November.
Now United Airlines has announced its blatant slot-squatting. Boy, this is egregious: “32 trips per day between NYC-area and D.C., a 78% increase and the most flights of any airline.” This covers them out of LaGuardia and also National airport, while they left JFK five years ago and have been scratching their way back to a limited presence at that airport and don’t have available slots to squat there.
[N]ew nearly hourly shuttle service between New York/Newark Liberty International Airport and Reagan National Airport on Oct. 31, and is adding five new flights between LaGuardia Airport and Washington Dulles Airport.
At least United will operate many of these flights with premium-configured 50 seat regional jets.
United Airlines CRJ-550
United and Delta are flying planes to avoid losing their government-subsidized slots. Meanwhile, as a result of the American Airlines-JetBlue Northeast Alliance settlement with DOT, those airlines actually have to increase their total flying out of New York JFK and LaGuardia. They don’t get more slots, so they’re flying bigger planes.
During the American Airlines ‘State of the Airline’ employee session after last Thursday’s earnings call, Chief Revenue Officer Vasu Raja reported that 300,000 customers flew on the American-JetBlue alliance in the third quarter, bigger than any of American’s international partnerships.
The Department of Justice is suing to block the deal – that the federal government approved this year – on the grounds that American might co-opt JetBlue as a low fare provider even as they increase the supply of seats in the market and give New York customers a realistic third choice beyond United and Delta.
Oddly the federal government seems to believe it’s better for consumers to protect the United-Delta large carrier duopoly in the market. American Airlines has said in its two most recent employee meetings that it plans to go to trial – and win – rather than seeking to settle the suit.