The FAA's $12.5 Billion Sky Rebuild Just Got a New AI Brain. Here's What It Actually Does.
Illustrative image to be generated for Smart Travel Finance. Not affiliated with the FAA, the U.S. Department of Transportation, Air Space Intelligence, or any airline.
The FAA just sat down with the CEOs of American, United, Delta, and Southwest to talk about a new piece of software. It's not a new plane, a new runway, or a new fee. It's a prediction engine, and it's part of a $12.5 billion rebuild of the system that decides whether your flight leaves on time.
- FAA Administrator Bryan Bedford met with the CEOs of American, United, Delta, Southwest, and other major airlines on September 10, 2026, to discuss rolling out SMART, a predictive flight-scheduling system, starting this month
- SMART stands for Strategic Management of Airspace, Routes, and Trajectories; the FAA awarded a 12-year, $875 million contract for it in June 2026 to Air Space Intelligence, a Boston startup that beat larger competitors Palantir and Thales
- SMART's technology traces back to a tool Alaska Airlines began using internally in 2021 to help its own dispatchers suggest flight routes, now being scaled to the entire national airspace system
- SMART is one piece of a larger $12.5 billion air traffic control modernization effort; the FAA has separately requested $10 billion more, while a broader aviation-industry coalition is lobbying Congress for as much as $20 billion in additional funding
- Initial SMART deployment will focus on rescheduling flights disrupted by bad weather, with potential later expansion to broader schedule and trajectory coordination before aircraft even depart
- Better airspace management could reduce certain sources of delay, but nothing in the available reporting suggests this will lower ticket prices; those are separate questions this article does not conflate
FAA Administrator Bryan Bedford met Thursday, September 10, 2026, with the CEOs of American Airlines, United Airlines, Delta Air Lines, Southwest Airlines, and other major carriers to discuss the agency's plan to begin rolling out SMART, a new predictive flight-scheduling system, this month. "It's going to be transformational," Bedford told reporters in late August. "We'll make much better decisions if we have better decision-making tools." The meeting was organized by Airlines for America, the industry's main trade group, which said the SMART initiative "will have a direct positive effect on American travelers" by reducing delays and cancellations.
What SMART Actually Does, and Where It Came From
SMART, short for Strategic Management of Airspace, Routes, and Trajectories, continuously analyzes airline schedules, weather, airport capacity, airspace conditions, and other operational constraints to predict where congestion or conflicts are likely to develop, before they actually happen. The FAA awarded the contract in June 2026 to Air Space Intelligence (ASI), a Boston-based startup, in a 12-year deal worth $875 million. ASI beat two much larger, established defense-and-analytics competitors, Palantir and Thales, for the work.
The technology isn't unproven: Alaska Airlines began letting a version of ASI's AI system suggest flight routes to its own dispatchers back in 2021. Five years later, the same underlying software is being scaled from one airline's operations center to the entire U.S. national airspace system, a considerably larger and more complex task. Initial deployment is expected to focus on one specific use case: more effectively rescheduling flights that were canceled due to bad weather, with potential later expansion to broader schedule and trajectory coordination before aircraft even depart.
Background on ASI's contract award and Alaska Airlines' earlier use of the technology per independent reporting from Forbes, Aerotime, and other outlets, cross-checked against Reuters' September 10 report.
Why This Is Happening: A System Running on Outdated Parts
Bedford has been blunt about the state of the system SMART is meant to help fix. "What we're seeing is a system that is woefully unorganized," he has said, noting that individual air traffic facilities don't have the ability to see the entire national airspace picture in a unified way. The FAA has faced years of struggle with congestion tied to rising travel demand, ongoing runway construction, severe weather, and air traffic controller shortfalls; in April 2026, it ordered airlines at Chicago O'Hare to cut 300 daily flights through October 2027, and in June it extended flight cuts at Newark and other New York-area airports, both citing congestion concerns directly.
The Bigger Rebuild SMART Sits Inside
SMART is a software layer riding on top of a much larger, $12.5 billion hardware and infrastructure overhaul the FAA calls its air traffic control modernization program. Per the Department of Transportation's own materials, the program is replacing radar, software, hardware, and telecommunications equipment at more than 4,600 sites nationwide, targeting, by the end of 2028, roughly 5,000 new high-speed network connections, 27,000 new radios, 450 new digital voice switches, and 612 state-of-the-art radar systems, among other upgrades. Bedford is separately scheduled to testify before a U.S. House appropriations subcommittee on this program's status, with the FAA requesting an additional $10 billion in funding on top of the original $12.5 billion.
Where Does the $12.5 Billion Go?
The number gets repeated constantly, but the modernization plan itself breaks down into specific, countable pieces of infrastructure. Tap through the categories below to see what the Department of Transportation's own materials say the money is actually funding.
Where Does the $12.5 Billion Go?
Tap each category to see the target by end of 2028, and how far along the FAA says it is as of its own reporting. Figures are drawn directly from the Department of Transportation's published materials; nothing here is estimated or invented.
Educational explainer using figures published by the U.S. Department of Transportation. Not a forecast of flight delays, fares, or program completion dates.
Why This Matters for California Travelers Specifically
Neither the Reuters report nor the Department of Transportation's own materials reviewed for this article break the $12.5 billion program down airport-by-airport or state-by-state, so this article does not claim a specific dollar figure or project count tied to LAX, SFO, or any other individual California airport. What is verifiable: California's major airports are part of the roughly 4,600-site National Airspace System this modernization covers nationally, and the predictive technology behind SMART itself has direct California roots, since Alaska Airlines, a major West Coast carrier, was the original real-world testing ground for the underlying AI system now being scaled nationally.
⚠ What This Doesn't Mean for Ticket Prices
Better airspace management and fewer weather-driven scheduling conflicts could improve efficiency and reduce certain sources of delay. That is a genuinely different claim from saying ticket prices will fall. Airline pricing depends on fuel costs, demand, competition, and dozens of other factors unrelated to air traffic control software. This article does not assert or imply that SMART or the broader modernization effort will make flying cheaper.
- Traveling out of a California airport and want to compare fares before booking? Try our Cheap Flights Finder
- Curious how another recent aviation story affects California travelers? Read our coverage of Alaska Airlines' 50th nonstop route from San Diego
- Planning ahead for holiday travel costs regardless of delay rates? Use our California Monthly Budget Guide
What This Article Is Not Saying
This is not a claim that flight delays will decrease by any specific amount, or on any specific timeline; SMART's initial deployment is described as beginning this month with a first use case limited to weather-related rescheduling, and its broader effects are not yet measurable. This is not a claim that this modernization program will lower airfare; efficiency improvements and ticket pricing are separate questions this article does not conflate. This article does not assert specific California-airport-level project details that were not disclosed in the sources reviewed. Political framing in official government materials (including the name of the underlying funding legislation) is reported factually and neutrally, not editorialized.
Visual Illustration: Understanding SMART and the Modernization Effort
This original illustration is based on the themes discussed in this article. It is for educational and illustrative purposes only and is not an official FAA, DOT, or airline graphic.
Illustrative graphic to be created for Smart Travel Finance. Based on the themes discussed in this article; not an official FAA, DOT, or airline graphic.
Frequently Asked Questions
What is the FAA's SMART system?
SMART (Strategic Management of Airspace, Routes, and Trajectories) is a predictive software system that analyzes airline schedules, weather, airport capacity, and airspace conditions to identify potential conflicts and congestion before they occur, rather than reacting to delays after they happen.
Who built SMART, and has it been used before?
Air Space Intelligence (ASI), a Boston-based startup, won the $875 million, 12-year contract in June 2026, beating larger competitors Palantir and Thales. A version of the underlying technology has been used by Alaska Airlines' own dispatchers since 2021.
How much is the FAA spending on air traffic control overall?
SMART's $875 million contract sits inside a larger $12.5 billion modernization program covering radar, telecommunications, radios, and control tower upgrades at more than 4,600 sites nationwide. The FAA has requested an additional $10 billion; a separate aviation-industry coalition is lobbying for up to $20 billion more.
Will this make my flight tickets cheaper?
Not necessarily, and this article does not claim it will. Improved airspace efficiency and fewer weather-related scheduling conflicts are a different outcome from ticket pricing, which depends on many unrelated factors.
Does this specifically affect California airports?
California airports are part of the National Airspace System this modernization covers nationally, though the sources reviewed for this article did not break the program down by specific airport or state. The SMART technology itself has California roots through its earlier use at Alaska Airlines.
How Closely Do You Read Infrastructure Announcements?
Answer 6 quick questions about how you'd interpret a story like this one. This is a reflection tool to help you think through the story, not a prediction about flight delays or fares.
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