AA & Others Eager To Fly To China

Reuters is reporting that American Airlines is going to fly to Shanghai from Chicago on Sunday. Not only that, but they've been waiting fourteen years to get in. That's right - over a decade ago they set up an office in Beijing, and it's only now that they're getting to fly to China.

The airline expects to fly up to 245 passengers to China a day, and the load factor's pretty nice, too: AA predicts that 86% of its seats will be full. They'll definately be making money on that flight. And American also predicts that the amount of people flying between the two nations will grow by 500,000, or 17%, per year. Right now 3,000,000 fly betewen China and the U.S. each year.

Right now only three U.S. airlines fly to China: United to Beijing from Chicago, Los Angeles, New York, San Francisco and to Shanghai from Chicago and San Francisco and Continental to Beijing from Newark. (Northwest flies via Tokyo to Beijing, Shanghai and Guangzhou, but not directly from the U.S.)

And when more - if limited - rights are given starting in 2007, you can be sure that they'll be arguing over who gets 'em. Continental wants to fly to Shanghai from Newark, but United - which has been flying to China for a long time - wants even more routes to Beijing, Shanghai and Guangzhou. In March 2007, the Department of Transportation will dole out 14 round trips to 'existing U.S.-China carriers' - meaning, at this time, either United or Continental. Half of those round trips must be to smaller cities, and an agreement with the Chinese government allows the DOT to allow a new carrier to start flying to China in 2008. My guess is that Delta will be this next carrier. After all, it's tried to get permission to fly to China from Atlanta and was turned down.

International routes are mostly profitable for U.S. airlines. Flying a bunch of people to Tokyo or London more often than not creates more cash than flying a bunch of tourists down to Disney World. The US and Chinese governments will be holding talks in Beijing on April 19 and 20 over the opening of Chinese skies. The top three airlines in China have sent letters to the country's top aviation board, the CAAC, opposing the freer skies that United and the like want so badly.