By David Shepardson

(Reuters) -A U.S. trade group representing major passenger and cargo airlines asked the Federal Communications Commission (FCC) on Thursday to halt deployment of new 5G wireless service around many airports, warning thousands of flights could be disrupted.

AT&T (NYSE:T) and Verizon Communications (NYSE:VZ) are set on Jan. 5 to deploy C-Band spectrum 5G wireless service that they won in an $80 billion government auction. The petition from industry group Airlines for America seeks a deployment delay near numerous U.S. airports including ones in Chicago, San Francisco, Los Angeles, Las Vegas, New York, Boston and Seattle.

The aviation industry and the U.S. Federal Aviation Administration (FAA) have raised significant concerns that 5G might interfere with sensitive aircraft electronics like radio altimeters, which could delay or divert flights.

"Aircraft will not be able to rely on radio altimeters for numerous flight procedures and thus will not be able to land at

certain airports," the group said in its emergency FCC petition.

It said wireless interference will "jeopardize the function of critical aircraft safety systems, which in turn threatens to divert or cancel thousands of flights" daily. It said this would disrupt "millions of passenger reservations" along with flight crew schedules and global supply chains.

The petition seeks an FCC decision by noon EST Monday or the group warned it will "seek judicial or other relief" to avoid "immediate and unacceptable safety risks."

Wireless industry group CTIA said 5G is safe and the spectrum is being used in about 40 other countries.

CTIA said Thursday "the FCC considered and rejected these claims nearly two years ago after an exhaustive review" and the industry still plans a Jan. 5 launch for 5G service.

The FAA declined to comment on the petition. The agency has been preparing to issue notices further detailing impact of potential interference but has delayed release as intensive talks continue between the Biden administration, wireless carriers and the aviation sector.

Airlines for America, which represents American Airlines (NASDAQ:AAL), Delta Air Lines (NYSE:DAL), United Airlines, FedEx (NYSE:FDX) and other major carriers, said it wants the FCC and FAA "to work together on a practical solution." The petition is aimed at preserving legal options if discussions do not result in an agreement.

This month, the group warned interference from 5G networks could cause 4% of U.S. flights to be diverted, delayed or canceled, and the FAA issued airworthiness directives warning 5G interference could result in flight diversions.

Airlines for America has said that if the FAA 5G directive had been in effect in 2019, about 345,000 passenger flights and 5,400 cargo flights would have faced delays, diversions or cancellations impacting 32 million passengers.

"The potential damage to the airline industry alone is staggering," the petition says.

In November, AT&T and Verizon delayed commercial launch of C-band wireless service by a month until Jan. 5 and adopted precautionary measures to limit interference.

Aviation industry groups said that was insufficient. The aviation industry made a counterproposal that would limit cellular transmissions around airports and other critical areas.