Could the FAA Outage Hinder Business Travel's Recovery?

The outage of the U.S. Federal Aviation Administration's Notice to Air Missions system on Wednesday caused at a minimum another day of severe disruption for the aviation industry, just two weeks after a holiday winter storm triggered problems, especially for Southwest Airlines. Thousands of flights have been canceled or delayed. 

Will today's incident—the effects of which could creep into the rest of this week and upcoming holiday weekend—coupled with the recent holiday disruptions be another setback for business travel recovery?  

"As we've seen and especially recently travel disruption of any sort can have a broad and tremendous impact, not only on travelers, but also on the travel companies who serve them," Global Business Travel Association CEO Suzanne Neufang said in a statement to BTN. "Business travel disruption comes with the increased risk of economic impact—both regionally and globally—when the ability to conduct business and meet with clients and teams is significantly affected." 

In addition, talk of an upcoming recession has some companies cutting back their workforce or putting essential-only travel policies in place. During the Covid-19 pandemic, companies halted their business travel and found they could still be productive by use of other means, such as virtual calls and meetings.  

"If you've been affected by various disruptions we've seen happen, whether because of a pilot shortage, weather or traffic control center issues, at some point you will say, 'I will do everything I can to travel less for business,' " Henry Harteveldt, president and travel industry analyst for Atmosphere Research Group, told BTN. "Our research shows this is true. Today's FAA disruption does nothing to make people want to travel more for business." 

There is potentially a silver-plated lining to this event. "Business travel is just starting to recover from the holiday period, and there are fewer people traveling for business these days because of the ability to do so much work remotely," Harteveldt said. Further, the disruption occurred on a Wednesday, which is not typically a peak business travel day, he added.

Government Systems and Transparency 

FAA hasn't yet announced what caused the outage and has been limited in its public statements, saying it was continuing to look into the cause. [Update, Jan. 11: FAA in a statement said that "our preliminary work has traced the outage to a damaged database file. At this time, there is no evidence of a cyberattack."]

The agency also has had issues prior to today's debacle. Last week, an air traffic control system problem resulted in a ground stop in Florida and caused flight delays in the state's major airports, according to Reuters, which also reported the problem had been fixed. 

In 2022, an issue with the Jacksonville ATC center caused several problems for flights into and out of Florida. In May, FAA met with airlines in Florida about the area's delays and said it would increase staffing at Jacksonville, which oversees in-air traffic for five states—Alabama, Georgia, Florida, and North and South Carolina, according to CNBC. That ATC also handles space launches and military training exercises. 

Still, "we seem to be experiencing these disruptions on a sadly too-frequent basis, and I am concerned that the cumulative effect of this—probably more on leisure travelers than business travel—is a decision to fly less often and perhaps only when necessary," Harteveldt said. 

Today's incident also is likely to ruffle some feathers between the airlines and FAA. "Certainly the outage was not intentional, but I think it strains the relationship the airlines and FAA have with one another," Harteveldt said. "While the FAA is often swift to threaten fines at airlines if they don't get their act together, airlines don't have any way to say to the FAA, 'You just cost us a lot of money. Pay us back.' "  

FAA has been investing in what it calls the Next Generation Air Transportation System, a multibillion-dollar infrastructure program to modernize the U.S. National Airspace System. From its website, the most recent annual report on the program was from fiscal year 2020.  

"Both business and leisure travelers need a travel industry ecosystem they can rely upon and that importantly includes having air travel systems that can get them from point to point with safety, effectiveness and convenience," according to Neufang. "That's why GBTA advocates for the swift passage of the Federal Aviation Administration Reauthorization bill this year, as well as support for modernized FAA systems and backups."  

The U.S. Travel Association is on the same page. "Today's FAA catastrophic system failure is a clear sign that America's transportation network desperately needs significant upgrades," USTA president and CEO Geoff Freeman said in a statement. "Americans deserve to have an end-to-end travel experience that is seamless and secure. And our nation's economy depends on a best-in-class air travel system. We call on federal policymakers to modernize our vital air travel infrastructure to ensure our systems are able to meet demand safely and efficiently." 

Harteveldt asked, "Why wasn't there at least one redundant system, and if both the primary and a redundant systems failed, why did that happen?" 

He postulated that the issue could be related to funding or where or how FAA has prioritized its investments in its technology systems. "It may be both issues at play," he said. "It may be that that FAA needs more funding for technology, and it's also possible that there were investments that were pushed lower on the list of where the FAA chose to invest than perhaps they should have been. We don't know. But we deserve to have more transparency from the FAA about where it is investing and importantly, what it is going to do to ensure this kind of disruption doesn't happen again." 

Airlines' Responses 

Many of the major U.S. carriers have offered waivers, added flexibility or refunds for those affected by today's cancellations and delays. In addition, "airlines with interline ticketing agreements should be generous to get people rebooked on other airlines if their own carriers are full," Harteveldt said. 

United Airlines was the first carrier to announce it created a travel waiver for customers who needed to change plans, including refunds for those who no longer wanted to travel. American Airlines is providing additional flexibility to rebook travel today and Thursday without any additional fees. Delta Air Lines is offering a "fare difference waiver" to all Delta and Delta Connection flights on Wednesday and "will give customers additional flexibility to change their flights, even if their flight isn't delayed or canceled," according to the carrier. Southwest Airlines is allowing its customers traveling Jan. 11 to rebook in the original class of service or to travel standby within 14 days of the original date of travel between the original city-pairs and in accordance with Southwest's accommodation procedures, without paying additional charges. 

The carriers and FAA also should reach out to the travel management community, Harteveldt said. "Travel managers need to be confident that when they send their people out on the road, that their people will be able to safely travel to and from their destination," he said. "I think travel managers will have a lot of questions for airlines and the FAA, and those parties need to be ready to answer those questions and answer them honestly and intelligently." 

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