Much Ado about Slots ...

...and an unchecked bag full of animosity and legal threats. That’s pretty much the scenario brought on by Tuesday’s announcement by the U.S. DOT that it will begin auctioning slots at Newark Liberty International Airport. The Air Transport Association says it will sue to stop DOT from implementing a policy that it says is illegal. The Port Authority of New York & New Jersey, which operates Newark, says it will simply refuse to allow carriers using the auctioned slots to use its airport. You can land, but don’t bother taxiing up to a gate. Of course, slot controls were a major instrument in the regulation of air traffic at major airports (New York; ORD; LAX) for years. It was only back in the mid-90s that the industry moved away from slot controls in favor of free market forces. My favorite (and most confusing) part of slots back then was that the feds basically gave airlines slot space; the carriers later sued to have value given to those slots; and, later they were allowed to use the value of those slots to finance debt, or to sell. When government handouts are merely slots in space, well, one has to question the wisdom. The current situation also reminds me of the mayoral race in Los Angeles in the 1990s when diverting revenue from LAX to pay for neighboring police and fire protection became a campaign issue, and a major legal battle with DOT. In the end, DOT won out, as one would expect it to with Newark. Getting back to the concept of wisdom – it seems that is precisely what is needed today. While DOT Secretary Mary Peters could be lauded for trying to do something about congestion at New York’s airports, it’s hard to see the wisdom of reverting back to a concept that is decades old. But then, Robert Crandall is out there calling for the re-regulation of the airline industry. Thanks for reading. jfi