Global Avionics Round-Up from Aircraft Value News (AVN)
Air traffic control tower and multilevel infrastructure in Chicago International Airport.
The decision by the federal government to replace more than 600 aging radar systems across the United States is being framed as a long overdue modernization story.
In reality, it is also an admission of deep and persistent dysfunction at the core of the U.S. Air Traffic Control (ATC) system, dysfunction that now directly shapes avionics development, aircraft valuations, and lease rates across commercial and business aviation.
Transportation Secretary Sean Duffy and the Federal Aviation Administration (FAA) have selected RTX and Spanish firm Indra to replace 612 radar systems, many of which trace their lineage to the 1980s, with completion targeted for the summer of 2028.
The broader goal is to overhaul the national ATC infrastructure by the end of 2028, an aggressive timeline that coincides with the final stretch of President Donald Trump’s current term. FAA Administrator Bryan Bedford acknowledged the obvious when he recently said the radar network is outdated, expensive to maintain, and increasingly difficult to support.
Replacing Floppy Disks
That statement understates the problem. The FAA has been forced to spend the majority of its roughly $3 billion annual equipment budget simply keeping obsolete systems alive. In some facilities, controllers still rely on technology that uses floppy disks. (Yes, you read that right — floppy disks.)
Replacement parts for certain components are no longer manufactured, pushing the agency into the surreal position of hunting for spares on secondary markets like eBay. This is not a charming anecdote about bureaucratic inertia. It is a structural failure with cascading consequences for airlines, lessors, manufacturers, and avionics suppliers.
The fragility of the system became impossible to ignore last spring, when technical failures twice knocked out radar serving the airspace around Newark Liberty International Airport.
The outages triggered thousands of delays and cancellations at one of the country’s most critical hubs. While redundancy is built into ATC architecture, there have been repeated incidents where both primary and backup systems failed simultaneously, including at the Philadelphia facility that manages traffic into and out of Newark. Safety was preserved, but operational confidence took another hit.
For airlines and lessors, these disruptions are not abstract policy issues. They translate directly into cost, risk, and uncertainty. Chronic ATC instability inflates block times, erodes schedule reliability, and forces carriers to pad timetables. That padding reduces aircraft utilization, which in turn undermines the economic assumptions behind lease rates and asset values.
When an aircraft flies fewer productive hours per day because of systemic airspace inefficiencies, its revenue potential declines. Lessors notice. Appraisers notice. Investors notice.
This is where avionics enters the story in a more consequential way. For years, the FAA and industry have talked about NextGen, performance-based navigation, and satellite driven surveillance as the future of air traffic management.
In practice, progress has been uneven and often constrained by the weakest links in the ground infrastructure. Airlines have invested billions in advanced flight decks capable of precision navigation, data link communications, and enhanced situational awareness. Yet those capabilities are only as valuable as the ATC system they plug into.
The persistence of antiquated radar and communications equipment has slowed the operational payoff of modern avionics. Features such as required navigation performance, advanced surface movement guidance, and trajectory-based operations promise fuel savings and capacity gains, but they depend on reliable, modern ground systems.
The Effects on Aircraft Valuation and Leasing
Aircraft values increasingly reflect not just airframe age or engine type, but avionics relevance. Jets equipped with older flight decks that struggle to interface with evolving ATC requirements face steeper depreciation curves.
Conversely, aircraft with upgradeable, software driven avionics architectures are more resilient. Lessors are already pricing this reality into lease rates. Aircraft that can support future airspace mandates without expensive retrofits command premiums, while those that cannot are seeing shorter lease terms and more conservative residual assumptions.
The irony is that ATC dysfunction is accelerating this bifurcation. As the FAA races to replace 14 different radar systems with a smaller number of standardized platforms, avionics manufacturers are under pressure to ensure compatibility across a transitional landscape that will last the better part of a decade.
This uncertainty affects avionics development priorities. Manufacturers are investing heavily in modularity, backward compatibility, and incremental certification paths. They are also pushing more intelligence into the cockpit to compensate for limitations on the ground.
Enhanced onboard spacing tools, advanced weather integration, and predictive traffic displays are becoming more attractive as operators seek operational advantages that do not depend entirely on ATC modernization arriving on schedule.
From a leasing perspective, this has tangible consequences. Aircraft with avionics suites that can be upgraded via software rather than hardware swaps are easier to place and re-place. They reduce downtime during transitions between regulatory regimes. They also mitigate the risk that a delayed FAA program will strand an aircraft with obsolete capabilities. Lessors favor these platforms because they protect asset liquidity in a volatile policy environment.
The FAA has already committed more than $6 billion of the $12.5 billion Congress approved for the overhaul, and Duffy has said another $20 billion will be required to finish the job.
The agency has replaced more than one third of outdated copper wiring with fiber optic connections and hired national security contractor Peraton to oversee the effort. These are meaningful steps, but they also highlight the scale of the challenge. This is not a simple radar swap. It is a wholesale rebuild of a national nervous system while it remains fully operational.
This article originally appeared in Aircraft Value News.
John Persinos is the editor-in-chief of Aircraft Value News.