Transportation Secretary Sean Duffy announced Wednesday afternoon that he will be reducing flight capacity by 10% at 40 major airports starting Friday morning, affecting roughly 3,500 to 4,000 flights daily. CNBC's Phil LeBeau joins 'Squawk on the Street' to discuss the details.

New York

The Federal Aviation Administration (FAA) has ordered a 10% reduction in flights at major U.S. airports in response to the ongoing government shutdown. The cuts are aimed at reducing the volume of flights, particularly regional jets, to alleviate pressure on air traffic controllers, many of whom have been working without pay since October 1.

Smaller airports are expected to feel the greatest impact, with some cities seeing daily flights reduced from three to one. While most air traffic controllers continue to work despite missed paychecks, some have sought other employment, prompting the FAA to implement these measures to maintain operational safety and efficiency.

Here's how reduced flights will impact airports, travel

While we have you, we've got to talk about the airlines because the FAA is ordering what is unprecedented, right? A 10 percent cut in flights at big airports due to the shutdown. How's this going to work? You're going to see the small airports really are going to feel the biggest impact, I should say. Remember, it is the volume of flights. It is not the number of people that the FAA wants cutbacks on at the largest airports. And if you look at the largest airports, generally speaking, it depends, it varies by most airports, but generally speaking, 10 to 15 percent of the flights they handle are regional jets. So a city like Wichita, Kansas, where I once lived and worked, and I love Wichita, they have a couple of flights a day, three flights a day, I think, from Wichita to Dallas. That may go down to one. A city like Greensboro, North Carolina, same thing. They, instead of having three flights into New York, they may go down to one with a particular airline. That is the easiest way for the airlines to cut down on the volume of flights for the air traffic controllers. But you're not going to hit the bottom line as hard. You want as many people on those flights that are still going. So the larger aircraft, to the most part, are going to be exempt from these cutbacks. There's going to be a meeting today between the airline executives and the FAA and DOT to map out what's going to happen. And then you'll start to see this. I think this is going to go relatively smooth, guys. I do not think that this is going to cause a world of problems. Because, look, it's not fun if you're in one of those smaller cities and you had a flight that was booked and now they're going to put you on another one. But that's where the airlines are likely going to make the cuts in terms of flights. But the air traffic controllers are working unpaid, right? They've been working unpaid since October 1st. They are having to work. Yep. Yep. It's ridiculous. They are. And that is why, rightfully, you see the FAA saying, look, some of these guys are not showing up at work, guys and girls. They're not showing up at work because they've got to pay their family's bills. And so therefore, they may decide, you know what, I'm going to take a job doing something else. I just need some money coming in. It's hard to know how much of that is actually happening versus how many people they are continuing to show up. The vast majority are. There's no doubt about that. The vast majority are continuing to show up and do their jobs. But as John Duffy said yesterday, I can't fault somebody if they've missed a couple of paychecks for going out and saying, I got to get some money, bring it in. I'm not here to volunteer for weeks on end, which is really what you're asking them to do. Phil, thank you. Phil Lebeau on Tesla, obviously, airlines. We'll be monitoring that Tesla vote, of course, as the day moves along.

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