Minimal impact on airlines from US budget cuts so far, says IATA

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The IATA has seen minimal impact from the US government budget cuts on its member airlines, and is taking a wait-and-see approach as it continues to observe the impact of the cuts on wait times at airports.

IATA director general and chief executive Tony Tyler says the impact of the cuts, known as sequestration, has been "limited" so far. "There has been no disruption in operations," he tells Flightglobal on the sidelines of the 6th ICAO Air Transport Conference in Montreal.

The cuts went into effect on 1 March, resulting in $600 million in cuts to the US Federal Aviation Administration (FAA) budget through the existing fiscal year, which ends on 30 September. The FAA has warned that the cuts could close more than 100 air traffic control towers and that midnight shifts would be eliminated at an additional 60 towers.

Most of the FAA's employees will also be furloughed for at least one day per 14-day pay period from April through September. Customs and immigration wait times at busy airports including New York John F. Kennedy and Chicago O'Hare are expected to increase as the Department of Homeland Security rolls out furloughs as well.

Tyler says some airlines would have to carry more fuel on board because there would in effect be fewer airports to divert to in cases of emergency. "Of course there will be a cost element to that," he adds.

The cuts to the FAA's budget have caused widespread concern among airports and airlines, who worry that potential flight disruptions could hurt their bottom line.