Donald Trump, Meeting With Airline CEOs, Targets Air-Traffic Control System

By Carol E. Lee and Susan Carey 

WASHINGTON -- President Donald Trump, meeting with airline executives at the White House Thursday morning, suggested adopting changes to the government's air-traffic control system and placing a pilot at the head of the Federal Aviation Administration.

Mr. Trump also promised the executives he would reduce government regulations, lower taxes on American businesses and fund infrastructure upgrades, all of which he said would help their companies hire more workers.

His agenda received a warm reception from those who attended the meeting, which included chief executives from United Continental Holdings Inc., Delta Air Lines Inc., Southwest Airlines Co., Alaska Air Group Inc., three cargo carriers and heads of airports in Los Angeles and Atlanta.

Mr. Trump said the air-traffic control system is "totally out of whack" and said his polices would soon start helping companies such as airlines hire more people, including "rolling back burdensome regulations" and "lowering the overall tax burden of American businesses."

"We want the traveling public to have the greatest customer service and with an absolute minimum of delays," Mr. Trump said. "And we have an obsolete plane system, we have obsolete airports."

Southwest CEO Gary Kelly, speaking to CNBC after the meeting, welcomed the focus on modernizing the air-traffic-control system. "We believe there is about $25 billion of waste annually with the system that's currently being used," he said. "That's where I think you can get the biggest bank for the buck."

Since Mr. Trump's election, airlines and airports have said they are optimistic about his plans to lower taxes and raise infrastructure spending. But it isn't yet clear how those policies would be implemented.

Mr. Trump promised an announcement within the next three weeks that he promised would be "phenomenal in terms of tax."

Many of the airlines support a plan to remove air-traffic-control operations from the Federal Aviation Administration and place them into a not-for-profit corporation. Some four dozen nations already have taken that step. But an earlier House Republican effort to win congressional support for the concept was unsuccessful. A spokeswoman for the FAA had no immediate comment Thursday.

The president on Thursday asked why the airlines have allowed the government to invest in a faulty system. Mr. Kelly of Southwest replied that airlines aren't in control of those decisions. The CEO also said funds being spent to modernize the air-traffic control system haven't helped it improve.

Most U.S. carriers believe a corporate air-traffic-control system separate from the FAA would be more efficient because it would allow them to raise funding from the financial markets, rather than relying on congressional appropriations.

The FAA's mandate will expire in September, providing an opening to discuss such changes. Delta has opposed the plan, saying the transition would be risky. Some corporate-jet and private pilots also oppose the concept because they fear it would raise their costs.

Some of the more contentious issues, such as the administration's travel ban barring citizens of seven nations from entering the U.S., didn't come up. While the order has been temporarily halted and is being reviewed by a federal appeals court, the Jan. 27 order rocked the industry. Huge demonstrations took place at many big airports opposing the order. Airlines were caught unawares and struggled to comply.

Another hot topic that was barely broached was the disagreement about the growth of Middle Eastern carriers into the U.S. and whether they are infringing on air treaties. President Trump alluded to it, however.

"I know you're under pressure from a lot of foreign elements and foreign carriers," he said. "I've been hearing that a little bit. At the same time, we want to make life good for them also. They come with big investments. In many cases investments are made by their governments, but they are still big investments."

Among the airline executives on the guest list for the meeting: Ed Bastian, CEO of Delta Air Lines, the No. 2 U.S. carrier by traffic; Oscar Munoz, CEO of United Continental Holdings, No. 3; Mr. Kelly of Southwest Airlines; Brad Tilden, chairman and CEO, Alaska Air Group; Bill Flynn, president and CEO, Atlas Air Worldwide Holdings, Inc.; Dave Bronczek, president and chief operating officer, FedEx Corp.; Robin Hayes, president and CEO, JetBlue Airways Corp.; Myron Gray, president of U.S. operations, UPS; and Nicholas E. Calio, president and CEO of industry group A4A.

Doug Parker, CEO of the largest carrier, American Airlines Group Inc., wasn't able to attend because he was scheduled to host 1,600 employees at an all-day conference, the company said earlier.

--Andy Pasztor contributed to this article.

Write to Carol E. Lee at [e-mail] and Susan Carey at [e-mail]

(END) Dow Jones Newswires

February 09, 2017 11:48 ET (16:48 GMT)

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