FAA weighs taking equity in air traffic AI contractor

The Federal Aviation Administration is looking at taking a financial stake in Air Space Intelligence, the Boston company behind an AI-assisted air traffic management platform, according to an internal agency document.

A term sheet the agency has prepared calls for the government to make an equity investment and hold a warrant to buy company shares at a set price. The term sheet expires at the end of 2026, and it is unclear whether a deal is near. The FAA and the company both declined to comment.

In June, Air Space Intelligence won a 12-year contract worth up to $875.9 million to develop two air traffic management systems. One, Strategic Management of Airspace, Routes and Trajectories, or SMART, uses weather, flight schedules and other operational data to forecast congestion. The FAA began limited use of SMART around Washington, D.C., in September, with a nationwide rollout planned later. The platform suggests actions to traffic managers; it does not control aircraft.

The equity idea has emerged as lawmakers question how the technology is being introduced. On Oct. 9, 25 Democratic legislators wrote to the agency asking it to pause SMART's first 90-day evaluation until more is known about safety testing, controller training and oversight. They requested an answer by Oct. 19, writing that changes to air traffic control systems must put safety first.

If completed, the arrangement would be the first of its kind known for the agency.