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Gov’t Might Help Pay for Aircraft Modernization

The government is considering giving aid to an airline industry reluctant to invest in expensive upgrades to their aircraft. These upgrades are essential to the ongoing effort to modernize air traffic control with a satellite-based system called NextGen.

However, Reuters reports that “Airlines are pressuring the government not to saddle them with the bulk of expenses for the planned multibillion-dollar upgrade of the air traffic system to one relying on satellites rather than ground-based radar.” This is and has always been the primary obstacle to implementing NextGen: It’s really expensive, and the airlines don’t want to pay for their part of it.

Now, it seems the government is open to some sort of financial assistance. According to Reuters, Department of Transportation (DOT) Secretary Ray LaHood “told the annual Federal Aviation Administration industry forecast conference that the White House was looking into the matter and should have something to say to them soon.” LaHood, however, didn’t offer any specifics, such as how much the government would offer or where that money would come from, though he did say “the administration wants to be helpful to the airline industry.”

Reuters also reports that “airlines were unhappy about being left out of the U.S. economic stimulus package in 2009 while high-speed rail got $8 billion, and would like help for meeting their contribution to air traffic modernization.”

Complicating matters is that there’s really no argument over whether or not we need NextGen. Back in November, US Airways CEO Doug Parker wrote a letter to LaHood in which he praised the system, saying it would “yield enormous benefits to consumers through reduced congestion” and “reduce carbon emissions significantly by shortening flight times,” and says the industry is “extremely supportive of its implementation.”

But again, the airlines don’t want to pay up. In that same letter, Parker wrote, “However, if the cost of deploying NextGen has to be covered by even higher taxes or fees imposed on the airlines, we prefer to live without it at the current time.” And Parker isn’t alone. According to Reuters, American CEO Gerald Arpey “believe[s] government should cover the basic costs to airlines of air traffic infrastructure, since … it is in the national interest to maintain a seamless system for air travel.” Arpey also said the cost to upgrade his airline’s aircraft could run in the hundreds of millions of dollars. Regardless of who pays for the infrastructure, airlines will be responsible for training personnel.

Personally, I think it’s a bit absurd for the airlines to seriously expect the government to cover the entire cost of upgrading their aircraft. The new system will benefit them, after all, through increased efficiency, fuel cost savings, and a better customer experience. Parker said so himself. But for airline execs to say they want all that and want it for free seems unrealistic at best, shameful at worst, and something of a slap in the face to consumers who deserve a safe, modern air traffic control system.

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