Capacity between the United States and China is heavily restricted, due to the bilateral agreement in place. Fortunately capacity between the two countries will be increasing in the coming weeks. This is a positive development, though we’re still a far cry from the pre-pandemic service we saw between the countries.
US & China modify bilateral agreement to 50 weekly flights
China doesn’t participate in the Open Skies agreement, which allows airlines to more or less add unlimited service between countries that are part of the agreement, pending available landing slots (for example, both the United States and European Union participate in Open Skies, which is why US airlines can add as many routes to Europe as they want).
Instead, air service to China is based on bilateral agreements between countries. During the pandemic, China greatly restricted foreign carrier service to the country, and many countries retaliated by similarly restricting Chinese airlines from flying to their countries.
This wasn’t a big issue when China was in full lockdown mode, but with China having lifted restrictions, air service to the country is still quite limited.
Under the current agreement between the United States and China, airlines from each country can collectively operate 35 weekly roundtrip flights between the two countries. That already represents an increase, as previously the limit was 24 weekly flights, and prior to that 18 weekly flights, and prior to that 12 weekly flights, and prior to that eight weekly flights.
That limit is about to be increased even further — as of March 31, 2024, the cap on flights between the United States and China will increase to 50 weekly roundtrip flights for airlines from each country, just in time for the summer travel season.
It’s important to note that 50 weekly flights between the countries is still only a small fraction of pre-pandemic service. Prior to the pandemic, the US and China bilateral agreement allowed for 150 weekly flights for airlines from each country, so we’re now approaching one-third of pre-pandemic capacity.
Increased service is good for consumers
Obviously increased service between the United States and China is good for those looking to travel between the two countries, since it should open up more frequencies, leading to lower fares. But even if you have no interest in traveling to China, this could still positively impact you.
In the past few years, we’ve seen a massive increase in airfare between the United States and virtually all of Asia. That’s largely because of the situation between the United States and China:
- Most people traveling to and from China have been connecting through other countries for long haul travel, taking up seats and raising fares through Hong Kong, Japan, Korea, Singapore, etc.
- Pre-pandemic, Chinese airlines did a lot of capacity dumping, so many people connected in China when traveling between the United States and other points in Asia, leading to much lower airfare
Increased service between the United States and China should lead to lower fares and more award availability in other markets. However, we still have a long way to go here. We’re now going from ~23% of pre-pandemic capacity to ~33% of pre-pandemic capacity.
While capacity is still only a fraction of what it was pre-pandemic, it’s worth noting that demand between the United States and China is also far from recovered. There’s a lot less demand for travel in both directions. Even without restrictions, Chinese nationals aren’t traveling as much internationally as they did pre-pandemic, and Americans aren’t traveling to China as much as they did pre-pandemic.
Bottom line
In the coming weeks, we’ll see weekly flight allotments between the United States and China increase. With this, airlines from each country will collectively be able to operate 50 weekly flights, up from the current 35 weekly flights, but still a far cry from the 150 flights that were allowed pre-pandemic.
With this change, capacity will be at roughly one-third of pre-pandemic levels. It’s a step in the right direction, but don’t expect airfare between the United States and Asia to decrease meaningfully until we get closer to those numbers again. Then again, demand between the two countries also isn’t what it once was.
What do you make of air service between the United States and China increasing?
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