Airport Infrastructure: Unresolved Issues Make It Difficult to Determine the Cost to Serve New Large Aircraft
Published: 2002-02-04T00:00:00

Fast Facts:

Highlights:
section_title: What GAO Found
paragraphs: Airbus Industrie plans to introduce the New Large Aircraft (NLA) to U.S. airports in 2006. The Boeing 747 (B-747)is currently the largest commercial aircraft. The Federal Aviation Administration (FAA) sets standards that govern how an airport must be configured to safely serve aircraft with certain wingspans and weight. A B-747 operates under Design Group V standards, while FAA has determined that NLA will operate under Design Group VI standards. Determining the cost to serve NLA is difficult because several possible infrastructure changes at airports are unresolved. These include (1) whether and the extent to which FAA revises the standards or grants modifications, (2) which airlines buy NLA and the frequency of NLA service at U.S. airports, (3) when NLA begin serving these airports, and (4) the extent to which the cost estimates reported by the airports are attributed to NLA instead of changes to accommodate growth in air traffic. The 14 airports that expect to serve NLA by 2010 collectively report that their cost estimate for infrastructure changes is $2.1 billion; however, the ultimate cost will depend on how issues that affect cost will be resolved. As these issues are resolved, airports will have a clearer understanding of what infrastructure changes must be made at their costs.

section_title: Letter
paragraphs: Airbus Industrie (Airbus), the European manufacturer of large  commercial aircraft, plans to introduce New Large Aircraft (NLA) to U. S.  airports in 2006. Airports, such as New York’s John F. Kennedy  International (JFK) and Los Angeles International, which now provide  service to the Boeing 747 (B-747), currently the largest commercial  aircraft, as well as those that serve as hubs for airlines that might purchase  NLA, are likely candidates to serve these new aircraft. The Federal  Aviation Administration (FAA) sets the design standards that govern how  an airport must be configured to safely serve aircraft with certain  wingspans and weight. A B-747 operates under Design Group V standards,  while FAA has determined that NLA will operate under Design Group VI  standards. Currently, FAA is reviewing the standards for NLA, which were  published in 1983, to determine whether they should be revised.
Many large airports could serve NLA now by placing restrictions on NLA’s  ground operations or those of other aircraft. However, because many of  these large airports have typically experienced congestion and delay  problems, such measures as restricting NLA to designated taxi routes,  terminal gates, and runways, and/or restricting the ground movements of  other aircraft would likely hinder the efficient movement of traffic. To  safely serve significant numbers of NLA while efficiently moving air traffic,  U.S. airports might need to upgrade such infrastructure as runways and  taxiways. In 1997, 20 airports that were likely candidates to receive NLA  reported to FAA that costs to meet Design Group VI standards would total  $6.6 billion (in 1997 dollars). At that time, FAA noted that the costs  reported by some airports included estimates associated with planned  projects that were not a direct consequence of the NLA. Since then, some  airports have decided not to serve NLA and others have revised their  estimates. In response to your request, this report provides the airports’  estimates of the costs needed for infrastructure changes to accommodate  NLA.
While the number of NLA that individual airports would serve is uncertain  at this time, Airbus expects the market for its A380 to be robust. Because  of the terrorist attacks of September 11, 2001, it is unclear whether any  long-term reduced demand for flying might result in fewer than expected  NLA sales and lower use at U.S. airports. It is also unclear how the  increased emphasis on airport security might affect the cost of  infrastructure changes airports plan to make to serve NLA. As agreed with  your office, we plan, at a later date, to examine the costs and other issues  associated with safety and security as well as the operational, capacity,  and environmental challenges that U.S. airports might face in serving NLA.
In July 2001, we mailed a survey to officials at the 23 airports that we  identified as likely candidates to serve NLA and asked them if they were  planning to accommodate NLA at their airport and to estimate the costs  for those infrastructure changes that they would likely make if FAA  revises the standards and/or grants modifications to their individual  airport. We received responses from 22 airports. We asked airports to  derive their cost estimates from those that were used to support planning  documents, such as an airport’s master plan and capital budget. We did  not verify the airports’ estimates for accuracy. (See app. I for additional  information on our scope and methodology.)
subsections: section_title: Background
paragraphs: To develop and maintain a national system of safe airports, FAA  promulgates federal standards and recommendations for the design of  airport infrastructure. FAA’s airport design standards regulate how an  airport must be configured to safely serve aircraft with certain  characteristics, such as wingspan and weight. Design Group V standards  serve the B-747, while Design Group VI standards will serve NLA (see fig.  1). FAA has established a process to grant modifications to airport design  standards according to an airport’s unique local conditions. Under a  recently established policy, FAA headquarters officials have the sole  authority to approve modifications to the standards for accommodating  NLA. Generally, an airport’s request must show that an acceptable level of  safety, economy, durability, and workmanship will continue despite any  modification. (See app. II for more detailed information on airport design  standards and the process for requesting and granting modifications.)
section_title: The Cost for Airports’ Infrastructure Upgrades to Serve NLA Will Be Affected by a Number of Unresolved Issues
paragraphs: With the arrival of NLA closer and the availability of more up-to-date  information to airport officials about whether airlines plan to offer NLA  service at their airports, 14 airports reported that they expect to serve NLA  by 2010. Determining the cost to serve NLA is difficult because a number  of issues are unresolved including whether and the extent to which FAA revises NLA’s design standards or which airlines actually buy NLA and the frequency of NLA service at U.S. whether NLA will begin service in the United States as early as 2006, as  planned; and  the extent to which the cost estimates reported by the airports are  attributable to NLA instead of changes to accommodate growth in air  traffic.
The 14 airports that expect to serve NLA by 2010 collectively reported that  their cost estimate for infrastructure changes is $2.1 billion.  However,  even with these changes, officials from most of these airports told us that  they do not expect their airports to fully meet current Design Group VI  standards. (See app. III for a list of these cost estimates by airport. See  app. IV for the cost estimates from these 14 airports to upgrade their four  major types of infrastructure.)
Regarding the unresolved issues, most airport officials told us that they  plan to apply to FAA for modifications to the standards or to serve NLA by  restricting its operations. FAA has three studies underway to evaluate  certain Design Group VI standards to determine which ones should be  revised. One study uses actual data from taxiing B-747 aircraft to  determine how much pilots deviate from a taxiway’s centerline. The  amount of deviation is important to help determine a taxiway’s required  width to operate NLA safely. According to FAA, it has continuously kept  airport and industry officials informed of preliminary results of its on- going studies. However, FAA will not know until 2003, when the final  results are expected, whether to revise the current Design Group VI  standards and/or grant modifications or what the nature of any changes  might be. There are certain Design Group VI standards for which  modifications cannot be granted. For example, runway and taxiway  bridges designed to safely support a B-747 with a maximum taxiing weight  of 875,000 pounds cannot support an A380 with a maximum taxiing weight  of 1.4 million pounds.
Which airlines actually buy NLA, how they use these aircraft in their route  structure, and the total number of NLA that are put into service will  influence which airports eventually receive NLA and the cost for  infrastructure changes. For example, Honolulu International Airport is a  likely destination for NLA if Japan Airlines or All Nippon Airways, two of  the key airlines that serve this airport, buy them. If not, Honolulu  International Airport would not likely receive NLA on a regular basis and  could possibly accommodate them through modifications to standards,  thereby avoiding more costly infrastructure changes. The total number of  NLA in service and which airlines purchase them will be influenced by  market demand, which is even more uncertain than when the estimates  were made because of the September 11th terrorist attacks. Before and  after these attacks, Airbus has estimated that 1,500 NLA would be flying  worldwide by 2019. In contrast, in July 2001, Airbus’ competitor, Boeing,  said that it estimated that 500 NLA would be flying by then—a threefold  difference. Each company’s future vision of air travel accounts for the  large difference between their estimates. Officials at many of the airports  we surveyed believe that if they serve only a few NLA, they might be able  to accommodate these aircraft with operational restrictions, thus making  full compliance with Design Group VI standards unnecessary. For  example, to help ensure safety, an airport could restrict NLA’s ground  movement to designated taxi routes, terminal gates, and runways, and/or  could restrict the ground movement of other aircraft.
The total estimated cost to accommodate NLA could also change because  the timing of its arrival is uncertain. The A380 has not been completely  built and the first flight (certification trial) is not expected until 2004. The  A380 is not expected to arrive in the United States until 2006. Meanwhile,  many factors, including commercial decisions and unforeseen technical  problems in certifying the aircraft for service, could delay this schedule.  This uncertainty has led some airports to decide that they will not upgrade  their infrastructure unless they are reasonably certain that some of the  airlines they serve will be using NLA there.
Lastly, distinguishing, where possible, between the costs for growth and  those specific to serving NLA would affect the estimated costs of  infrastructure changes. Costs that airports would incur for growth,  regardless of whether they serve NLA, should be separated from those that  an airport is incurring only because it is serving NLA. Airbus officials  stated that most of the estimated costs airports reported for infrastructure  upgrades are attributable to growth rather than accommodating NLA.  However, airport officials have told us that, in some cases, costs  attributable to growth and serving NLA are so interrelated that it is very  difficult to separate them.
Within the next 2 years, we expect some of these issues will be resolved.  For example, FAA expects to have final results from its tests on certain  airport design standards in 2003 and will then be able to decide whether to  revise the standards. With these issues resolved, airports will have a  clearer understanding of the infrastructure changes that must be made and  their costs.
section_title: Agency Comments
paragraphs: We sent a draft of this report to the Department of Transportation, the  Airports Council International-North America, and Airbus for their review  and comment. We met with Transportation officials, including the  Director, Office of Airport Safety and Standards, FAA. These officials  suggested that we explain why some airports indicated large differences  between the costs for meeting Design Group VI standards reported to FAA  in 1997 and those we received in 2001. We believe that the costs for  making infrastructure changes to fully meet Design Group VI do not  provide a realistic estimate of the changes that airports expect to make to  serve NLA. Therefore, we revised the report to focus on the airports that  expect to serve NLA and the costs of those infrastructure changes they  expect to make. FAA officials also provided a number of clarifying  comments, which we have incorporated.
The Senior Vice-President, Technical and Environmental Affairs, Airport  Council International-North America, provided oral comments. He  suggested that we clarify the relationship between Design Group VI  standards for new construction at airports and NLA’s operational  requirements. He said that the draft report made reference to airports’  inability to meet Design Group VI standards without noting that airports  can accommodate NLA with operating restrictions. We revised the report  to clarify this point.
The Deputy Vice President of Safety and Technical Affairs for Airbus  provided written comments (see app. V for the full text of Airbus’  comments). Airbus agreed with the list of 14 airports that reported that  they expect to serve NLA by 2010. However, the company said that the  estimates from these airports overstated the costs to accommodate NLA.  The company’s collective estimate for the 14 airports that expect to serve  NLA is $520 million, as opposed to the $2.1 billion collectively estimated  by the airports. The company provided two major reasons for this  difference. First, Airbus said that, in the majority of cases, there is no  safety need to bring existing airport infrastructure to Group VI standards  to accommodate the A380. Second, Airbus said that the cost estimates  reported by the airports are “rough” and do not reflect detailed analysis.  Airbus said that most of the cost estimates airports reported could be  attributed to the growth of air traffic and are not directly related to  accommodating NLA.
With respect to whether airports can safely accommodate NLA now, the  report was revised to acknowledge that many airports could accommodate  NLA by placing ground restrictions on its movement or the movement of  other aircraft and that these measures might obviate the need for  immediate infrastructure changes. However, if Airbus’ expectation of a  robust demand for its NLA becomes reality, these measures are not likely  to provide an efficient long-term solution, especially at those large airports  that have experienced delay and congestion problems in the past. As for  the rigor of the estimates, we asked the airports to derive their cost  estimates from those used to support such planning documents as their  master plan and capital budget. We revised the report to clarify the basis  for their estimates. While the draft report acknowledged that the estimates  were based on assumptions about several factors, we revised it to state  that distinguishing between the costs attributable to growth versus the  costs specific to serving NLA would affect an airport’s cost estimate.  Airport officials have told us that it is very difficult to separate these costs,  especially when an airport expects to serve NLA as a part of its growth.
Airbus also disagreed with including any costs for the five airports that are  not likely to receive NLA by 2010. However, if these costs are included, the  company estimated the costs for 19 airports to fully meet Design Group VI  standards at $1.7 billion, as opposed to the $4.6 billion reported to us. We  agree with Airbus that including the costs for five airports to fully meet  standards when they do not expect to accommodate NLA does not provide  a useful estimate. Moreover, some airports told us that they do not expect  to make some of the changes that they reported would be necessary to  meet these standards because of space limitations or other factors.  Therefore, we revised the report to focus on the airports that expect to  accommodate NLA and their cost estimates for the infrastructure changes  they plan to make.
We performed our work from June to December 2001 in accordance with  generally accepted government auditing standards.
As agreed with your offices, unless you publicly release its contents earlier, we plan no further distribution of this report until 30 days after the date of this report. At that time, we will send copies of this report to the Ranking Minority Members, Senate Committee on Commerce, Science, and Transportation and its Aviation Subcommittee; interested Members of Congress; the Secretary of Transportation; and the Administrator, FAA. This report is also available on GAO’s home page at http://www.gao.gov. If you have any questions on matters discussed in this report, please call me at (202) 512-3650 or call Belva Martin, Assistant Director, at (202) 512- 4285. We can also be reached by e-mail at dillinghamg@gao.gov and martinb@gao.gov, respectively. See appendix VI for a list of key contributors to this report.
section_title: Appendix I: Scope and Methodology
paragraphs: We mailed a survey to officials at 23 airports and asked them to update the  cost estimates to upgrade their airport infrastructure that they had  reported to the Federal Aviation Administration (FAA) in 1997. We sent  surveys to the same 22 airports that FAA had surveyed because those  airports provided nearly all of the B-747 service or serve as hubs for  airlines that might purchase New Large Aircraft (NLA) and therefore are  likely to also serve NLA. We also included Indianapolis because it is a  cargo hub for Federal Express, which has already placed an order with  Airbus for 10 NLA.
Because 4 years have elapsed, we expected that airport officials would  have more recent information to estimate the following:  the cost to accommodate NLA, if FAA revises the Design Group VI  standards or grants modifications to them and  the cost to fully meet Design Group VI standards.
The officials were asked to specify their airport’s total estimated costs to  upgrade the following four major types of infrastructure for NLA: runways;  taxiways; bridges, culverts, and tunnels; and terminals, concourses, and  aprons. (See app. IV for estimates of these costs by category.) We also  asked additional questions about their plans for serving NLA, such as the  number of aircraft they expect to serve and the time frame for service.  When answers were unclear or incomplete, we conducted follow-up  telephone calls for clarification. We asked airports to derive their cost  estimates from those that were used to support planning documents, such  as an airport’s master plan and capital budget. We did not verify the  airports’ estimates for accuracy.
We received responses from 22 of the 23 airports, including 19 of the 20  that responded in 1997 and 3 additional airports. Only Lambert-St. Louis  International Airport did not respond. In 1997, FAA received responses  from 20 of the 22 airports it surveyed; Honolulu International and Orlando  International did not respond.
section_title: Appendix II: Airport Design Standards
paragraphs: The FAA establishes airport design standards to configure an airport’s  infrastructure to safely serve aircraft with certain characteristics, such as  wingspan and weight. Design Group V standards serve the Boeing 747,  while Design Group VI standards will serve NLA. FAA defines Design  Group V aircraft as those having a wingspan of at least 171 feet but less  than 214 feet. Design Group VI aircraft are those having a wingspan of at  least 214 feet but less than 262 feet. The standards for Design Group VI  were published in 1983 and are currently under review by FAA. The  agency has established an NLA Facilitation Group to help introduce NLA  at airports. This group is made up of FAA, Boeing, Airbus, and other  aviation officials, including representatives of airports, airlines, and pilots.
Unique local conditions might require modifications to airport design  standards on a case-by-case basis. FAA’s approval is required for  modifying airport design standards that are related to new construction,  reconstruction, expansion, or an upgrade at an airport that receives  federal or federally approved funding. FAA has established a process to  approve modifications to standards. An airport’s request for a  modification must be submitted to the appropriate FAA regional or district  office for evaluation to determine whether the modification is appropriate,  and, if it is, the proper level of approval. Under a recently established  policy, FAA headquarters officials have sole authority to approve  modifications to standards related to serving NLA.
Some of the Design Group VI standards that pose the most difficult  challenges for airports are runway and taxiway widths, separation  distances (e.g., for a runway and parallel taxiway and for parallel  taxiways), and infrastructure strength (e.g., for bridges and culverts).  Clearances on aprons, ramps, gate areas, and terminals at many airports  might also need to be upgraded to meet these standards. For example,  John F. Kennedy International Airport (JFK) does not fully meet all of the  current Design Group V standards because the airport is severely limited  by a lack of airfield space. Airport management is developing plans to get  the airport to Design Group V and hopes that with FAA’s granting a  modification to the airport or revising certain Design Group VI standards,  the airport would be able to safely serve NLA. (See table 1 for a  comparison of current design group requirements for key infrastructure  features of airports and specific features at JFK.)
section_title: Appendix III: Cost Estimates Reported by 14 Airports to Serve NLA through Revisions or Modifications to Design Standards
section_title: Appendix IV: Airports’ Cost Estimates to Upgrade Four Major Types of Infrastructure
paragraphs: Our survey asked airports to provide cost estimates for four major types of  airport infrastructure: runways; taxiways; bridges, culverts, and tunnels;  and terminals, concourses, and aprons. According to a 1997 survey, these  areas represent those that are most likely to require upgrades to  accommodate NLA.
Figure 3 shows the percentage of the $2.1 billion total estimated cost to  upgrade each major type of airport infrastructure at the 14 airports that  expect to accommodate NLA through revisions or modifications to FAA’s  airport design standards. The $663 million reported for upgrading runways  accounts for the largest percentage of cost (32 percent). NLA. Moreover,  Los Angeles International Airport’s estimate to upgrade its runways  accounts for $398 million of the total reported by 14 airports. Upgrading  bridges, tunnels, and culverts accounts for 28 percent of the total cost  ($593 million). The vast majority of the bridge and tunnel costs are  attributable to a $508-million project at Los Angeles where the freeway  runs under the airfield. Upgrading the cost for taxiways accounts for 24  percent ($509 million) of the total cost, and upgrading terminals,  concourses, and aprons accounts for 15 percent of the total cost ($317  million). At some airports, airlines are responsible for these areas, so  upgrading them does not show up as a cost to airports. Additionally, since  two airports, Indianapolis International and Memphis International, are  primarily going to receive the cargo version of the A380, terminal upgrades  would not be needed.
section_title: Appendix VI: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgments
paragraphs: Key contributors to this assignment were Carolyn Boyce, Jean Brady,  Stephen Brown, James Fields, David Hooper, Michael Horton, Mitchell Karpman, Kieran McCarthy, Richard Scott, and Kate Wulff.