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The problems at Newark Airport
in New Jersey over the last few weeks have highlighted the needs
to upgrade parts of that
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industry. And while there is a
need to fix these issues as quickly as possibly, there must
be a way to be able to also
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think about a review of the
system in general for the safety of our airports and our planes
and the people who fly on them.
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Gad Allon is Professor of
Operations, Information and Decisions here at the Wharton
School. Gad, great to catch up
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with you again. How are you? I'm good. How are you? Great to be here, back. Thank you. And I guess
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when you look at what has
happened at Newark Airport, but also the flight that crashed in
Washington, DC a few months ago,
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there is probably more of a call
to look at a lot of the systems that are in and around this
industry right now.
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Yeah. And I know it's slightly
different—let me also add the fire in Heathrow Airport a few
weeks ago as well. I know, very
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different story, but not
unrelated. What we see here is neglect of years, right? I mean,
in the case of— actually, focus
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on the US and Newark and DC—
people have been warning for years that we have a shortage of
air controllers. This is, I
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think—a few years ago, the number
that was quoted was at least 3000. Now we're talking about
maybe fewer. They're using
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technology. We can actually
change some of that, but we're talking about thousands of people
that are missing in terms
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of air controllers. Then there
are other issues, which are crumbling technology. Many of
these systems are antiquated and
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need to change. Their backups
are actually limited. In the case of— here I can actually,
should bring back London. There
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was— the issue there was fire in
one of the power supplies. There was a backup,
but the backup was exactly near
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the other power supply. In the
case of Newark, there was a wire that caught fire, and because
of that, for 15 to
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20 minutes, the air controllers
could not see anything. These are extremely, extremely
important infrastructure
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decisions. That neglect of years
brought us to where we are. Well, and I think for a lot
of people, they would be
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surprised that we are having
these issues in these types of locations, when you think about
how important these entities are
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to running our countries in
general. Right, exactly. I mean, Newark
is one of the most important
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airports in the country. It's the
hub for United, the biggest— one of the biggest airlines, but
definitely the airline with the
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biggest international footprint
among the American airlines. This is extremely, extremely
important, a node in the overall
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transportation within and
outside the US. DC, the same. So the fact that there is such a
long neglect means that there
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are probably many other
infrastructures that are actually not ready. So when you think about the
infrastructure piece and the
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transportation department here
in the United States coming out and saying they've formed a task
force and brought on a couple of
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different companies along with
their entity to be able to try and fix this as quickly as
possible. This still feels like,
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though, it is a short-term fix
for a longer-term problem. Exactly. I mean, exactly. I think
what we're going to see here is
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we need here— I'll give an
example. Inflation Reduction Act. There was a request to
allocate more budget to
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infrastructure. Ultimately, I
think— I forgot exactly the number. It's 1% or 4% of the
overall was allocated to that. We
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know for years that these are
issue that requires budgeting, rethinking. And having a short-
term task force for that
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is— that's exactly what
it does. It's actually just solving an issue for now, but
that will just— kicking the ball
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down the street. So for the component of the air
traffic controllers that you mentioned before, that's a
challenge, I guess, in part
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because of recruitment. But
there is a process that you have to go through in terms of your
training. And from what I was
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told a week or so ago, it's not
like you can be an air traffic controller in Philadelphia and
then just go up to New York and
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fill in the gap. You're talking
about very much different areas and processes that go through.
- Yeah,
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that is one thing that's true,
but there's actually an interesting aspect here. And you
mentioned Philadelphia and New
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York. One of the main things
that caused that— the shortage— was the fact that actually there
was a transfer of the air
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controllers from New York, from
New Jersey, to Philadelphia. So many of the people that control
the air in Newark actually are
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now based in Philadelphia. It
was against the advice of many air controllers, and it was done
with very little consult and
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advice from them. And so a big
part of that was actually, how do you actually manage the
change where there is a new
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technology, potentially, that can
solve on these issues that you're describing and
potentially, in the long run,
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reduce the dependency on where
the air controllers are, and reduce the dependency on them
knowing the specific air of
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where they are. But this is,
again, a long-term change that requires you to bring people on,
to get them to buy into the
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change, to make sure they
are aware of that, and rather than exactly the time where you
need them, have an accelerated
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number of them take retirement
or don't show up to work for other reasons. So I think
there's an aspect here of
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reducing the dependency you're
talking about. But that cannot be done against the construct
of the people actually doing the work.
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What do you think, then,
is the best process to try and make the corrections that are
needed, but also to look at this
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longer term, so that we can have
the best and safest air system in the country? Yeah. It's a great question. I
think one— first of all, one is
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to treat each one of the
flights that happened as a near as— the near accident is an
accident, right? The fact that
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nothing happened in Newark when
there was really no air controller, there are 170 planes
in the air if I remember correctly
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during that time. And imagine,
these are planes that are now essentially flying essentially
blind. And to me, at least,
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we have to treat and think
about that situation of what if actually 170 planes
actually crashed during that time?
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What type of an uproar
will we have? How much budget would we divert at that time to try
to fix these issues? How much
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money could have been saved, or
should have been— was saved by not— by these things not
happening? And so I think once
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we elevate to that level, I
think the next question is, really, what is the long term
budget we need for that? What's
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the technology? How do we
envision that? The US is actually behind, technology-wise, compared
to many global airports. What's
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the technology investment we
need to make? And then what is the change we need to make in
terms of these roles to make
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sure that we are solving— because
these are issues that are going to be— to reappear again, again, and again
every five years, unless we
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solve them as a much more
programmatic way for the next 30 years. The airlines are
moving slowly. This is an
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industry that overall moves
slowly, exactly for the safety reasons that you mentioned. But
the fact that it moves slowly means
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that we just need to look much
more into the future than looking into short-term
solutions. So thinking about,
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first of all, the cost of that,
budgeting appropriately, but then making sure that we are
retrofitting these with the
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right technology and training
plan, I think is the right route and process for that.
- So is
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the thinking, then, similar to
how it seemingly has been here in the United States about our
roadways? We've always put our
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roadways at the top of the
infrastructure conversation because of how much we move on
the highways, whether it be
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individuals going to school or
going to vacation or businesses shipping materials. That's
always been at the top of the
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focus.
- Yeah. I mean, if you remember, both of
us are based in Philadelphia. A few years ago, there was the I-
76 fire that people anticipated
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was going to take maybe a year to
fix, and it's going to impact the GDP. People basically said
that it might actually reduce
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our GDP by or growth of GDP by
1% just because of the fact that it's going to be such
an important artery of
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transportation and logistics.
Ultimately, they managed to fix it within 30 days and avert
many of these doom— gloom and
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doom predictions. But we don't
have anything remotely as urgent, or at least we don't
treat it with them remotely as
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urgency, the same urgency, even
though the impact can be colossal as well. There's a
reason the United Airlines CEO
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wrote an email to every person
that is a United customer, primarily because many customers
I know actually chose to avoid
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United. Avoid Newark, and maybe
avoid United, over the last few weeks since the incident. Once
because of the delays, but also
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because of safety. And so I
think we need to have the same level of urgency that we have
with respect to roads.
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Gad, great to talk to you again.
Thanks very much. All the best. Same here. Thank you.
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Thank you. Gad Allon,
Professor of Operations, Information and
Decisions here at the Wharton
School.