JFK International Airport: Operations, Capacity & Future Plans

Introduction: Aviation's Role in the U.S. Economy

The United States aviation system accounts for roughly 5% of U.S. GDP (Federal Aviation Administration, 2011). It occupies a storied and rich history in the minds of Americans. Airplanes often symbolize humanity's triumph over nature and the ability to accomplish goals once thought impossible. Today, airports are critical elements within the global infrastructure framework. Air transportation is a key component of the broader economic, political, and social processes that have developed throughout the world, providing much-needed access to efficient and cost-effective modes of travel. Airports also help increase adoption, utilization rates, and growth in certain industries. The travel and tourism industry, for example, is heavily dependent on efficient and properly functioning airports. They also facilitate the exchange of goods and services around the world. In fact, much of the increase in globalization realized in recent years can be attributed to airports (Button, 2000).

According to the International Air Transport Association, international passengers contribute $116 billion to the United States economy annually (International Air Transport Association, 2020). These globalization benefits compound when international travelers stay in the United States for an extended period. Conversely, a severe decline in air transportation can have an adverse impact on the overall health of an economy, as goods, services, and people must then be transported in far less efficient ways.

As it relates to American airports, one of the most frequented and consequential airports is John F. Kennedy International Airport. As one of the three major airports serving the New York and New Jersey metropolitan area, it occupies an entrenched position within the community and the overall American economy. It services over 50 million passengers annually and is heavily influenced by foreign tourism. The airport was the first to pioneer the unit terminal concept, in which a central terminal is comprised of separate sub-terminals with distinct characteristics. This system has since been improved upon with an 8.1-mile guideway system known as AirTrain, which connects passengers within the JFK terminals to a subway system, increasing efficiencies, reducing congestion, and enhancing the overall customer experience. Through these innovations, JFK aims to position itself as an efficient and effective airport capable of facilitating commerce.

Airport History, Ownership, and Financial Status

John F. Kennedy International Airport first opened in 1948 as New York International Airport. Today it is one of the nation's busiest airports, serving as a central hub connecting America to the rest of the world. The airport currently supports roughly 300,000 jobs within the New York area, paying out $18 billion in wages. Driven in part by heavy tourism, the airport generates roughly $56 billion in sales annually. The Port Authority of New York and New Jersey manages the airport. The current budget allocates $76 million for new AirTrain operations within JFK, and the agency receives a total of $2.1 billion allocated to New York's three major airports. As discussed in the capital improvements section below, the agency, along with the state of New York, is providing funds to significantly improve JFK's operations. Those projects — expected to be completed in 2023 — will redevelop terminals, relocate cargo facilities, create new roadways, and more.

As it relates to the agency's financial position, it has reported over $69 billion in assets and $30 billion in liabilities. On the asset side of the balance sheet, approximately $60 billion consists of investment in facilities. The largest liabilities are related to bonds and other financial obligations.

It will be important to observe how COVID-19 has impacted operations and the agency's subsequent budgets. According to the 2020 budget, most income is derived from passenger facility charges, grants, and other revenues. The pandemic halted flights, which diminished the airport's revenues and its ability to service corresponding debt obligations. However, this reduction in revenue will not critically undermine operations, as the agency currently holds over $4 billion in reserves.

Airside Operations and International Traffic

John F. Kennedy International Airport is unique in that it is heavily focused on travel and tourism from international customers. This creates distinct circumstances in its overall operations relative to other airports. First, the airport must maintain a much stronger and more unified security offering, given that the majority of its patrons arrive from foreign countries. Security procedures must be considerably more robust. Not only does JFK need to handle potential terrorist threats at an elevated rate, it must also work to mitigate risks associated with white-collar crime — particularly drug trafficking, human trafficking, and counterfeit currency entering the United States.

This international emphasis also presents significant capacity challenges. The table below illustrates the overall percentage of international travelers at JFK relative to other major airports in the nation.

JFK: Total Passengers 49.0M | International Passengers 24.7M | Percent International 51% | Passenger Growth (2010–2020) 68.7%

ORD: Total Passengers 62.6M | International Passengers 10.1M | Percent International 16% | Passenger Growth (2010–2020) 5%

ATL: Total Passengers 91.5M | International Passengers 9.5M | Percent International 10% | Passenger Growth (2010–2020) 21.4%

MIA: Total Passengers 37.0M | International Passengers 18.5M | Percent International 50% | Passenger Growth (2010–2020) 33.9%

LAX: Total Passengers 62.6M | International Passengers 16.5M | Percent International 26% | Passenger Growth (2010–2020) 20.3%

As the data show, regardless of region, JFK commands a premium position in international travel. Miami is comparable in percentage terms, but its international patrons are primarily from Hispanic or Caribbean countries. JFK is far more diversified, with large numbers of travelers arriving from China, the Middle East, and Europe. In addition, nearly six of the nation's top ten most heavily traveled routes pass through JFK in some form. When accounting for Newark Liberty International Airport and LaGuardia International Airport, nearly one-third of all air travel in the nation passes through the New York metropolitan area.

The combination of a large international focus and heavy travel volumes creates critical infrastructure and security challenges. The threat of chemical and biological security concerns is considerably higher at JFK than at most domestic airports. The COVID-19 pandemic illustrated this vividly: the virus originated in China, and JFK, with its heavy volume of Asian international traffic, may have served as one of the entry points through which the virus spread to the United States. The airport's role in handling nearly one-third of domestic air travel compounded those risks further.

The capital improvement plans discussed below include significant upgrades to address airside operational challenges. These include expanding capacity at key terminals, increasing efficiencies so international customers can more safely access runways and taxiways, and upgrading ventilation facilities to mitigate the spread of airborne diseases and other contaminants.

Conclusion: Meeting Future Demands

The airport is a critical infrastructure tool not only for the United States, but for the entire world. Updates to airports are necessary as demand for air travel continues to rise. The United States Department of Transportation predicts that by 2033 nearly 400 million additional annual passengers will be added to the system (Federal Aviation Administration, 2007). Due to funding constraints, physical space constraints, and political challenges, many of the nation's airports have become obsolete. John F. Kennedy International Airport is no different in this regard, as some of its terminals are now nearly two decades old.

Fortunately, JFK is a storied and iconic airport that occupies a unique niche within the travel industry. It is often characterized as America's introduction to the world, given the heavy influence of international tourism on its operations. JFK is one of the busiest airports in the world, with roughly 50 to 60 million people using its services annually. Between 30,000 and 40,000 commercial flights depart from JFK alone each year. It also supports the New York economy by directly sustaining 300,000 jobs and $18 billion in wages. More broadly, JFK is vital to the nation, facilitating the global exchange of materials, products, goods, and people on a daily basis and helping make the overall economy more efficient through air travel.

Although the airport is important and iconic, it is not without its faults. The airport needs to improve its operational efficiencies. Given its position as one of the busiest airports in the world, it must improve its ability to quickly transfer and facilitate individual movement throughout its terminals. Many of the terminals themselves are older and obsolete; their appearance does not reflect the innovative infrastructure that America aspires to project, and they must be upgraded accordingly. To address these concerns, the New York legislature has engaged in an ambitious project designed to make John F. Kennedy International Airport the airport of the future. This plan is designed to correct many of the airport's shortcomings by improving ground transportation, enhancing terminals, providing better security, and offering better amenities. The goal is to position JFK as the world's leading airport and to further strengthen the nation's ability to transport goods and services globally. The project is approximately two years from completion and, once finished, should showcase American innovation at its finest.

References

Button, K. J., & Taylor, S. Y. (2000). International air transport and economic development. Journal of Air Transport Management, 6(4), 209–222.

Cripps, K. (2020, May 11). The world's best airports for 2020, according to Skytrax. CNN Travel. https://www.cnn.com/travel/article/skytrax-world-best-airports-2020/index.html

International Air Transport Association. (2013, May). Economic benefits from air transport in the U.S.

Federal Aviation Administration. (2011, August). The economic impact of civil aviation on the U.S. economy. http://www.faa.gov/air_traffic/publications/media/faa_economic_impact_rpt_2011.pdf

Federal Aviation Administration. (2007, May). An analysis of airports and metropolitan area demand and operational capacity in the future (FACT 2).