Thursday, September 27, 2007

Delta and United awarded new USA-China routes

US DOT logoU.S. Department of Transportation (DOT) Secretary Mary Peters announced earlier this week that two new direct air routes between the United States and China have been awarded to to Delta Air Lines and United Airlines. Beginning in 2008, Delta will fly the Atlanta - Shanghai route, and United will begin direct service between San Francisco and Guangzhou. These awards represent final decisions by the DOT, according to a news release issued by the Department.
Peters also proposed awards for four new daily flights to begin in 2009: American Airlines for Chicago-Beijing service, Continental Airlines for Newark-Shanghai service, Northwest Airlines for Detroit-Shanghai service, and US Airways for Philadelphia-Beijing service. Final decisions of these proposed awards will be made in the near future after further public comment.

Secretary Peters said the announcement today is the result of an agreement signed in July with the Chinese government to open up airways between the two countries and double the number of daily flights allowed between the U.S. and China over the next five years. The agreement also allows for new cargo flights operating to and from the U.S. and China.

By increasing competition, allowing more flight options, and reducing costly stops and layovers, these new direct routes are expected to lower fares and increase convenience for both business and leisure passengers to travel to China, Secretary Peters said.
An article in Aviation Week about the new China routes notes that United, Delta and Northwest had argued for an additional weekly flight, but they were all unsuccessful. Maxjet's application for the 2009 new entrant award also was denied.

In addition to awarding the new routes, the DOT also changed existing rules regarding their sale or transfer. Previously, airlines had been prohibited from selling or transfering their routes to another carrier for a period of one year after the award. The DOT announced that it is extending this restriction to five years, however the new five-year rule would not apply apply in the case of airline mergers or acquisitions.