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Auction Opens for Slots at New York and Washington Airports

Bidding by airlines for the authority to take off and land at New York LaGuardia and Ronald Reagan Washington National Airport begins today, under the terms of a decision by the U.S. Department of Transportation (DOT) that will allow Delta Air Lines, Inc. and US Airways, Inc. to exchange some of their operating authorities at the two airports.

On Oct. 7, DOT approved a request by the carriers under which Delta would trade 42 daily slot pairs at Reagan National for 132 US Airways daily slot pairs at LaGuardia.  The Department placed a number of conditions on the trade designed to promote competition and protect consumers, including a requirement that the carriers divest themselves of eight pairs of daily slots at Reagan National and 16 pairs at LaGuardia. A “slot” refers to a carrier’s authority to take off or land at an airport where flight operations are limited by the Federal Aviation Administration.  A slot pair, or two slots, is required for a takeoff and landing.

“The conditions we placed on the slot transfer, including the auction, will help airlines with little or no service at LaGuardia and Reagan National gain a competitive foothold at these airports,” U.S. Transportation Secretary Ray LaHood said.

Only carriers operating less than five percent of the slots at LaGuardia or Reagan National, either with their own aircraft or through a code-sharing agreement, will be eligible to bid for the divested slots at that airport.  In order to ensure that a purchaser will be able to provide meaningful new competition, all eight slot pairs at Reagan National will be sold in a single bundle, and the 16 pairs at LaGuardia will be sold in two bundles of eight slot pairs each.

Bids will be accepted through 5:00 p.m. EST Nov. 22 and will be posted shortly after they are received at http://www.faa.gov/about/office_org/headquarters_offices/agc/ReAllocation with information about which bundles are being bid upon and the bid amount, but not the carrier’s identity.  On Nov. 23, the Department will notify the divesting carrier of the winning bidders, based on the highest bid.  Payments for the slots will go to the divesting carrier.

More detail on the slot auction, the Department’s decision on the slot transfer and other documents in the case can be found on the Internet at http://www.regulations.gov/search/Regs/home.html#docketDetail?R=FAA-2010-0109.

Monday, November 14, 2011