PRESS RELEASE
PARTNERSHIP FOR NEW YORK CITY
New York, New York
February 25, 2009
press release (PDF 45K)Congestion at Region's Three Major Airports Costs the Economy More Than $2.6 Billion a Year, According to Partnership For New York City Report
Business Travelers, Airlines and Shipping Companies Are Hard Hit by Delays, Posing Major Threat to Regional Economic Growth
The annual cost of flight delays caused by air traffic congestion at the New York Region’s three major airports were responsible for more than $2.6 billion in losses to the regional economy in 2008, and – if no action is taken – will total a staggering $79 billion over the eighteen year span between 2008 and 2025, according to Grounded: The High Cost of Air Traffic Congestion, a report released today by the Partnership for New York City.
In 2008, LaGuardia, JFK and Newark served about 107 million passengers, including 32 million business travelers. According to the report, the region’s airports, which handle about one-third of the nation’s flights, are ultimately responsible for nearly three-quarters of nationwide delays. These delays cascade and affect flights at airports throughout the global system.
The Partnership undertook this study as a way to establish the full economic costs of air traffic congestion at the three major airports serving the New York Metropolitan Region: John F. Kennedy International Airport (JFK), Newark Liberty International Airport (EWR), and LaGuardia Airport (LGA).
“Today, more travelers board more flights in and out of the New York regional airports than at any point in history, and an efficient and accessible air transportation system is vital to the region’s long-term economic strength,” said Partnership for New York City President and CEO Kathryn S. Wylde. “New York’s status as a thriving center of international business and finance makes some level of congestion inevitable; however, the current and projected levels of congestion in New York contribute to expensive delays, loss of productivity, wasted fuel, and pollution of the environment to an extent that cannot be tolerated.”
Among the report’s key findings:
- For passengers flying during the peak season, delays at the regional airports due to congestion were 68 minutes for departures and 53 minutes for arrivals, on average, across the region in 2007. By the end of day, delays frequently build up to 130 minutes or more.
- If left unabated, on average, across all three airports, per passenger time loss due to congestion will rise from 60.6 minutes in 2008, to over 106 minutes in 2025.
- The total value of lost time to the traveling public was $1.669 billion in 2008 and is projected to total $50 billion from 2008-2025.
- For business travelers, the cost of the travel time lost to congestion delays at the three regional airports was $676 million for 2008, and is projected to be over $18 billion for the period 2008-2025. About half this cost is incurred by residents and businesses based in the region. The loss to leisure travelers in 2008 was $993 million, with an estimated cumulative cost of $32 billion from 2008-2025.
- The airline industry incurred significant losses in fuel and staffing costs due to congestion, estimated at $834 million in 2008, and a total of $25 billion over the next 18 years.
- Shipping companies that utilize both passenger and freight aircraft also suffer losses from excessive delays. These losses were about $136 million in 2008, and would be about $4 billion between 2008 and 2025.
In addition to costs incurred by system users, the report identifies costs to the regional economy as a whole that result from productivity losses that are directly attributable to air traffic congestion. Losses include 5,600 full-time jobs that will not be created, over $16 billion in lost output and $5.5 billion in lost labor income over the next 18 years.
The entire region also must bear the impact of additional emissions generated by aircraft in on-the-ground delays. The long-term cost of these emissions is estimated to be $1.7 billion in total for the eighteen-year period.
Through 2025, the region will incur an aggregate loss of $23 billion in output, earnings and environmental costs simply as a result of flight delays at three airports. This does not include the significant economic consequences of delays within the national system that are attributable to problems stemming from congestion at JFK, LaGuardia and Newark Liberty.
Ms. Wylde concluded “The Partnership wanted to determine whether investing in expansion of regional airport capacity and upgrading the air traffic control system would pay off for the region and the nation. The findings of the study clearly show that such investment is more than justified by the cost burdens resulting from inefficient and unpredictable passenger and airfreight service due to congestion. Moreover, the opportunity to correct these conditions is now – when the federal government is poised to invest in long-neglected infrastructure as a means of stimulating recovery from the global recession.”
The Partnership commissioned HDR Decision Economics to conduct analysis for the report and benefited from additional input from Accenture and the Port Authority of New York & New Jersey. The full report is available on its web site at www.pfnyc.org.
About the Partnership for New York City
The Partnership for New York City (www.pfnyc.org) is a network of business leaders dedicated to enhancing the economy of the five boroughs of New York City and maintaining the city’s position as the center of world commerce, finance and innovation.