Summary of Federal Aviation Administration (FAA) Meeting with US Airways


May 10, 2007 at the FAA, 800 Independence Avenue, SW., Washington, DC

Re: US Airways Comments on Notice of Proposed Rulemaking for LaGuardia
Airport

US Airways accepted an invitation to meet with the FAA to discuss their
primary concerns with the Notice of Proposed Rulemaking (NPRM), as
outlined in their comments.  The FAA Chief Counsel notified US Airways
that detailed notes of the discussion, as it pertained to the
rulemaking, would be placed in the docket.  

A summary of the meeting discussion follows:

US Airways stands behind the comments they already filed in the docket.

US Airways believes the perimeter rule at LaGuardia restricts the
ability to compete.

US Airways has made large investments at LaGuardia Airport so any
changes that are made to the airport are important to US Airways.

The proposed rule is too “intrusive” into airline operations
(scheduling and aircraft gauge).

The proposal favors carriers conducting operations with large aircraft
and point-to-point service at the expense of network carriers.

Airlines and manufacturers respond to the market.  The industry
recognizes the shift in the market conditions but the proposal does not.
 US Airways plans to shift its use of 50-seat jets to 70, 80, and
90-seat jets even without and upgauging rule, but not at the speed the
proposed rule would require.  

Aircraft are long-term investments and cannot be changed overnight.  US
Airways have additional aircraft on order and plans to have a dramatic
shift in fleet but this transformation cannot be made faster.  

The proposed rule would cause problems for service to medium sized
markets because it is not practical for an airline to fly a 737 three
times per day to those markets, but demand requires frequency of three
flights per day. 

An upgauging rule cannot simply look at city size because in the east
coast US Airways also competes with the train and other forms of
transportation.  For example, US Airways operates small aircraft to its
hub in Philadelphia because they need to connect passengers through PHL,
but there is not sufficient origin/destination demand for the airline to
upgauge its PHL-LGA service.   

Expiration of Operating Authorizations 

US Airways did not provide extensive comments on aspect of the proposed
rule because there was not enough information provided in the Notice of
Proposed Rulemaking.

US Airways does not support the proposal to permit the Port Authority of
New York and New Jersey (Port Authority) to use market-based mechanisms
at LaGuardia, as proposed in “Sec. 503.  Allocation of operating
authorizations at LaGuardia” in FAA’s Next Generation Air
Transportation System Financing Reform Act of 2007 proposal. 
Specifically, US Airways believes that allowing too much local authority
to regulate airports interferes with national policy, in an otherwise
de-regulated industry.

Perimeter Rule

The perimeter rule is based on “archaic” principals and conflicts
with the goals of upgauging.  

The perimeter rule represents an arbitrary line, since there are
currently exceptions on Saturdays and to Denver, CO. 
“Intellectually” US Airways cannot understand how the perimeter rule
still stands when “such holes exist.”

The perimeter rule hurts U.S. carriers internationally in bi-lateral
agreements.

If US Airways could add flights to the west coast (e.g. Phoenix, Las
Vegas, Los Angeles) their average aircraft size would go up overnight
and upgauging would be easier to accomplish at LaGuardia.  

US Airways would rather not have to abide by regulatory upgauging, but
if it were included in a Final Rule, economically it would be easier for
the airline to upgauge if they could fly beyond the perimeter (in larger
aircraft) than to fly larger jets in smaller markets when demand does
not support it.  

Regardless of whether FAA includes “upgauging” in a Final Rule, US
Airways believes the perimeter rule should be terminated.

US Airways does not have a significant number of operations at Newark or
Kennedy airports, so the airline is uniquely harmed because they are
limited in the number of long haul flights they can operate from the New
York area.  

If the Perimeter Rule was terminated US Airways would not add flights to
the west coast at the expense of small communities because there are
market limitations on the number of flights that can profitably fly to
cities beyond the perimeter.  However, US Airways does expect some
pattern changes to certain communities as 70-90 seat aircraft are
introduced and this could provide available Operating Authorizations to
serve new markets.  

US Airways has been successful in its service to small markets, so it
has no incentive to withdrawal service from those markets.  Rather,
there would be a balance between small, medium and long haul markets. 
US Airways also noted that their aircraft are not interchangeable
between all markets.  For example, the aircraft they use to fly to local
markets, like Buffalo, cannot be flown to west-coast cities like Lost
Angeles.  

US Airways believes that operationally it is feasible to terminate the
perimeter rule and operate flights to long-haul markets from LaGuardia. 
Their belief is that airlines are capable of choosing aircraft that will
perform to long-haul markets on LaGuardia’s runway configurations. 
Also, they noted that airlines operate long-haul flights on other short
fields.  

Temporary Order

US Airways supports FAA’s decision in the current Order (Operating
Limitations at New York LaGuardia Airport, Docket 2006-25755) to
eliminate the four different slot classifications that existed at
LaGuardia under the High Density Rule (HDR).  They commented that it may
make sense to have a distinction for small community service, but that
there is not a need for four different slot-types.

US Airways urges the FAA to implement a secondary market in the
temporary Order that would permit buying and selling of Operating
Authorizations.  

FAA explained that the reason we did not permit buying and selling of
Operating Authorizations in the Order is because the “grandfather”
date that was proposed in the NPRM would pre-date the Order. Therefore,
any purchases or sales of Operating Authorizations under the Order would
revert back to the original “slot” holder under the HDR, if the
proposed rule were to be implemented as a Final Rule.  

However, the FAA’s reauthorization bill, Next Generation Air
Transportation System Financing Reform Act of 2007 could impact the
Final Rule and consequently, the Order may be in effect longer than
originally anticipated.  These issues may impact the FAA’s decision on
what to include in a Final Rule, and when to publish that rule. 
Additionally, due to the extensive nature of comments received on the
NPRM, the agency may consider issuing a Supplemental Notice of Proposed
Rulemaking (SNPRM).  All these issues will impact the FAA’s decision
on whether to amend the existing Order to permit permanent buying and
selling in the secondary market.  



Meeting Attendees

Tom Chapman			US Airways

C.A. Howlett			US Airways

Komal Jain			FAA

Howard Kass			US Airways

Kerry Long			FAA

Rebecca MacPherson		FAA

Brian Meehan			Contractor/FAA

Andrew Nocella		US Airways

Gerry Shakley			FAA

Nan Shellabarger 		FAA

Molly Smith			FAA

FAA Docket 25709

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FAA Docket 25709

