Slot Trading Opportunities in Collaborative Ground Delay Programs

The Federal Aviation Administration (FAA) and the major airlines in the United States have embraced a new initiative to improve air traffic flow management. This initiative, called collaborative decision making (CDM), is based on the recognition that improved data exchange and communication between the FAA and the airlines will lead to better decision making. In particular, the CDM philosophy emphasizes that decisions with a potential economic impact on airlines should be decentralized and made in collaboration with the airlines whenever possible.

The CDM paradigm has led to fundamental changes in the implementation of ground delay programs. A key component has been the introduction of the compression procedure, which allows for the exchange of arrival slots between airlines. In this paper, we consider opportunities for increased airline control by interpreting the compression procedure as a mediated slot trading mechanism. Based on this interpretation, we propose an extension that allows airlines to submit so-called at-least, at-most offers. We develop an efficient integer programming model to solve the mediator’s problem, and show that the resulting mechanism can substantially improve the ability of airlines to optimize their internal cost functions.