Nov 20, 2018

Flying Cars Are Coming. Here’s How to Set up the Skyways.

Your plane to San Francisco leaves in 45 minutes. That’s barely enough time to get through security, and you haven’t even left your house yet. A quick look at Google Maps compounds your anxiety. Traffic is horrible, and the closest Uber is 10 minutes away. Looks like you’re going to have to take a VTOL. As you head towards your neighborhood vertiport, you wonder how anyone ever lived without flying cars to whisk them above ground traffic in half the time.

This sounds like something out of a science fiction novel. But the technology to operate flying cars—also known as “vertical take-off and landing” (VTOL) aircraft—is farther along than many people realize, as Brent Skorup recently explained in the Wall Street Journal. What is presently more uncertain is how our airspace management policies will accommodate the future of commercial low altitude flight.

It’s a significant question. It would be a waste to develop some of the world’s most cutting-edge transportation technologies if our policies did not allow us to extract the full benefits.

The issue is how to safely and productively coordinate VTOL flights. Because airspace is an unowned commons, we need some kind of mechanism to prevent collisions and maximize social benefit.

We need to coordinate VTOL flights in a way that makes the best possible use of our common low-lying airspace. This includes not only other VTOL crafts, which may be numerous in dense areas, but also helicopters and drones. Furthermore, our airspace management system should be responsive to market demands while leaving room for heretofore unanticipated technologies.

Skorup recently published a research paper, called “Auctioning Airspace,” which discusses these challenges and proposes a path forward.

There are two opposing management paths. One, which is the policy default, is a centralized airspace management system. The second, which Skorup advocates, is a decentralized system coordinated through airspace license auctions.

A centralized system would deputize regulators as referees over competing airspace needs.

This would be a difficult task even if regulators bought in to the appropriate vision. Without guidance from prices, planners would have scant information about best airspace uses. They would be limited to time-consuming research and best guesses, which would usually miss the mark.

Then there is the question of how to resolve disputes. Let’s say one company wants to offer a rapid delivery VTOL service. Another courts personal transport. Those routes intersect, which creates safety problems as well as the headache of setting two often-changing schedules. How should regulators choose between them? There are no easy answers.

Furthermore, this structure would not be dynamic. Future innovations could be thwarted by “lock in” from partially-informed first policies. Or specific firms could become untouchable incumbents, presenting the possibility of regulatory capture. Both of these forces could mean whatever VTOL services managed to come about would charge higher prices.

Consumers would not get the full benefits of these technologies with a centralized management system, which means more time in traffic and more missed flights to San Francisco.

Airspace auctions are a far superior method to divvy up the skies.

Here’s how it would work. Policymakers, with input from experts and industry, should first identify routes that would be attractive airspace corridors. There would be different levels of “skyways,” some more valuable than others. Each skyway could bundle a specific set of rights governing things like access, transferability, and monetization into a license.

Just as we auction licenses for other common pool resources like spectrum, publicly owned natural resources, and offshore wind farms, the federal government can auction skyway licenses.

This presents the best of both worlds, by tying federal management to the price system. Regulators would no longer have to cross their fingers and make a guess about best airspace uses. Rather, introducing property rights allows the price mechanism to lead us to the highest valued activities. Additionally, our precious commons would not suffer the tragedy of overuse. Safety and sustainability would be well managed.

There are policy wrinkles beyond federal airspace management to work out as well.

The development of VTOL passenger transit in places like China illustrates current technological capabilities, but the comparison is not institutionally perfect. The US, for instance, lacks important infrastructure. America has a much less developed helicopter system than some other countries, but far more airports, creating a unique combination of an underdeveloped low-laying flight system and a complicated air traffic control system. These complications will need to be considered.

The first step may be for a federal actor to champion the cause of airspace auctions. One excellent candidate is the Presidential Council of Advisors on Science and Technology (PCAST). The cause of pro-innovation air taxi policy combines many issue areas important to the Trump Administration: a blend of transportation infrastructure, manufacturing, and high technology. By bringing together key experts and stakeholders, PCAST could jump-start the needed policy conversation to make air taxis a reality.

State and local governments have a role to play too. After all, they have jurisdiction over zoning and infrastructure policies that can make or break the future of VTOL. Zoning regulations that prohibit the placing of profitable vertiports should be revised. (Local residents, fear not: VTOL technologies are far quieter and less obtrusive than substitutes like helicopters.) Noise ordinances, too, should be made compatible with VTOL crafts.

The potential of next-generation aviation technologies is as vast as the airspace they will soon zip around. Our skies are valuable, and our policies should reflect that. Airspace auctions are the best way to literally reflect their value.

 

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