Fuel regulation

Federal regulation of fuel prices, open discussion among airlines about fares and increased foreign investment are among the temporary proposals the American Association of Airport Executives (AAAE) is promoting to combat record fuel costs.

"We're not calling for re-regulation ... [but we're] not calling for government to do nothing. Government does have a role to play," AAAE president Chip Barclay said during a press conference yesterday in Washington, DC.

Permanent regulation of fuel prices is not needed, but could be used during emergency situations, he says.

The trade group's Energy/Air Service Task Force created recommendations in the midst of reduced capacity and lost service at airports as disparate Hartsfield-Jackson Atlanta International and Ohio's Toledo Express airport as airlines cut capacity to combat fuel costs.

Toledo lost half of its service when two airlines exited three marketsand departures at Atlanta are expected to be down 5% year over year from October.

The task force suggests, "government should temporarily direct emergency refining capacity to jet fuel if needed. The government should also take emergency steps to reduce or eliminate the non-cost-based 'spread' between jet fuel and other refined products of crude oil."

Limitations of foreign investment of US airlines should be temporarily suspended, Barclay says, noting much is made foreign interest in US carriers, but less so when foreign companies eye US carmakers.

As for pricing, the task force report says, "government should provide temporary anti-trust immunity to US airlines to meet and discuss routes and fares, under the supervision of Department of Justice and DOT, and with the participation of representatives of local communities. The goal of these conferences should be to maximize a national system of air services at the best possible cost to passengers."

L-R Tory Richardson, executive director of airports for Fort Wayne-Allen County Airport Authority; Jim Elwood, AAAE 2008-2009 chair and airport director for Aspen-Pitkin County Airport; AAAE president Chip Barclay.
(Photo by Daryl Humphrey, AAAE art director)

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