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Airline-Infrastructure Aid Chorus Grows

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If the federal government is willing to spend money on infrastructure, the airline industry has a long list of pressing needs.

Top executives at Delta(DAL Quote – Cramer on DAL – Stock Picks), American(AMR Quote – Cramer on AMR – Stock Picks) and the Air Transport Association all say the nation’s aging air transportation infrastructure should be addressed under a proposal by President-elect Barak Obama to spend heavily on public works projects as a means of economic stimulus.

Aging infrastructure, particularly the air traffic control system but also inadequate passenger facilities and an insufficient number of runways, has long hampered commercial flight operations, resulting in costly delays for both airlines and their passengers.

“Airlines are not approaching the idea of stimulus spending by looking for a handout from the government,” ATA CEO James May wrote Wednesday, in a transportation blog on the site of NationalJournal.com, a Washington-based political reporting site. “But we do firmly believe that in order to help jump-start the economy, our track record as a ‘jobs multiplier’ and our essential role in moving people, goods and services efficiently, makes a strong case for wise, strategic investments.”

May said investments in “new air traffic management technology could bring tremendous savings in lost productive time for the national economy and, perhaps even more importantly, tremendous environmental gains,” while “investment in high-energy efficiency upgrades for our nation’s airports could produce model programs in key transport hubs.”

Speaking at an investor conference on Tuesday, Delta Executive Vice President Glen Hauenstein noted the carrier continues to seek terminal improvements at New York’s Kennedy Airport, where it uses terminals, built in 1960 and 1962, that once housed Pan American World Airways.

“We are committed to finding a long-term solution at Kennedy,” said Hauenstein, adding: “Maybe we can get some help from our government on that, with a lot of public works projects on the docket for the next four years.” The Port Authority of New York and New Jersey, which owns the terminals, is currently conducting a $20 million redevelopment study.

Meanwhile, American CEO Gerard Arpey also urged government support for infrastructure upgrades. “I think the airline industry should certainly be at the top of the list of the industries that are deserving of economic stimulus as it relates to infrastructure,” he said, according to The Associated Press. “Because we have let the infrastructure in aviation deteriorate, both on the ground and in terms of the air traffic control environment.”

“I think we need to be actively engaged in the stimulus discussions,” Arpey said. “I would like to think that the airline industry would merit a great deal of attention.” Besides the air traffic control system, Arpey mentioned airport runways and control towers, and security enhancements for passenger and cargo facilities.

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