Congestion Pricing: Unpopular On The Ground And In The Sky

Federal officials backed away from a plan to use congestion pricing to manage commercial air traffic in the New York region.

In a federal plan to prevent chronic delays that can cascade nationwide, the number of flights in and out of New York City-area airports will be capped at busy times next year, starting with John F. Kennedy Airport and then at neighboring Newark, N.J."

"These new measures will cut delays, protect consumer choice, support New York's economy, and allow for new flights as we bring new capacity on line," said Transportation Secretary Mary Peters.

Others saw potential drawbacks.

"'It discourages new entrants' into the New York market, said Michael Derchin, an analyst at FTN Midwest Securities Corp. in New York.

Ray Neidl, an analyst at Calyon Securities in New York, said capping flights has a consequence if demand doesn't decrease. 'A tighter seat supply could enable airlines to raise prices,' Neidl said.

The Air Transport Association, which represents most big airlines, said it doesn't expect any big ticket price increases as a result of the changes, compared to congestion pricing, or charging more at peak travel times. That had been discussed as government officials and airline representatives met during New York-related talks over the past several months.

'One thing I can assure you is prices will remain far more constant than if we had congestion pricing,' said Jim May, head of the trade group. 'I would hope normal competitive forces will remain in place. A lot will depend on the extraordinary cost of fuel.'

The new measures include an agreement to cap hourly operations at JFK, plans for similar hourly limits at Newark and capacity improvements for the region, Peters said."

Full Story: Federal flight plan limits New York-area activity

Comments

Comments

Filght caps and Congestion pricing

The airlines will fight it tooth and nail but it is the only way to control the traffic at JFK, DC and ORD. These airports all had slots until a few yers ago. The Feds, in thier infinite wisdom, lifted the caps and boom. On-time arrivals plummeted. Coincidence? No.

Congestion pricing is absolutly the best way to go here. The casual traveler does not need to arrive in NYC at the premium business slot. I don't know why the airlines are so afraid of the reality. Instead of selling out to seats at $100 per trip at peak pricing they can charge $500. The plane doesn't need to be full to make a profit and they can shift the casual traveler to off peak times. They reality is they just don't want to hear the squeals from the business travelers.

Another result of the removal of slots was the increase in frequency of flights and the decrease in size of equipment used. Instead of a frequency of 3 737's a day an airline might have jumped to 8 flights a day all RJ's. Congestion was inevitable. It is really ridiculous that 7 airlines will all have a 5:15 arrival time at an airport with only two runways. This my friends is a physical impossibility.

Congestion Pricing Is Popular On The Ground

After it is implemented, congestion pricing is popular.

"... prior to the start of London's now-popular congestion pricing system, opposition was intense. ... After three years of congestion pricing, Transport for London surveys showed that more than 70 per cent of Londoners said the system was effective and twice as many supported the charge as opposed it."

http://www.streetsblog.org/2007/01/18/new-congestion-charging-survey-in-...

Charles Siegel

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