Airline lobbying groups are urging the Biden Administration to prevent Chinese airlines from adding service to the United States. I can’t help but find the argument to be weak…
In this post:
Air service rights between the United States and China
For a bit of background, caps on air service between the United States and China are based on a bilateral agreement, which determines the number of flights that can be operated between the two countries. During the pandemic, we saw China impose unilateral restrictions on service, given the country’s approach to the virus.
Since then, we’ve seen service between the two countries restored at a slow pace. As of last week, the agreement between the United States and China was expanded to allow airlines from each country to collectively operate 50 weekly roundtrip flights between the two countries:
- This is still just a fraction of the pre-pandemic service, as prior to the pandemic, airlines from each country were allowed to operate 150 weekly flights
- However, the 50 weekly flights is more than the previous limit of 35 weekly flights, and the limit of 24 weekly flights before that, and the limit of 18 weekly flights before that, etc.
- That 50 weekly flights number is really low, and amounts to roughly seven flights per day for airlines from each country between the world’s two largest economies; just to put that into perspective, any of the individual “big three” US airlines operate way more flights between the United States and Italy in peak season than all US airlines combined operate between the United States and China
While we’re still only one-third of the way to service being restored, the US airline industry is now urging the government to not expand flight limits between the two countries any further.
US airline industry makes bad faith argument against Chinese airlines
A letter has just been sent to the Biden Administration that’s signed by an airline lobbying group (Airlines for America) and three unions (ALPA, APA, and AFA). Let me just share the entire letter, since it’s light on details:
On behalf of the U.S. aviation industry, we are writing to urge you pause additional passenger flights between the United States and the People’s Republic of China until U.S. workers and businesses are guaranteed equality of access in the marketplace, free from the existing harmful anti-competitive policies of the Chinese government.
Following the outbreak of COVID-19, China unilaterally suspended the bilateral air services agreement with the U.S. and effectively closed the market to U.S. carriers. During this period, the Chinese implemented strict limits on market access, as well as imposing challenging rules effecting operations, customers and the treatment of our airline crew. These actions demonstrated the clear need for the U.S. government to establish a policy that protects U.S. aviation workers, industry and air travelers.
The competitive disadvantage is harmful to the approximately 315,000 workers employed by U.S. passenger airlines that serve China. If the growth of the Chinese aviation market is allowed to continue unchecked and without concern for equality of access in the market, flights will continue to be relinquished to Chinese carriers at the expense of U.S. workers and businesses.
The anti-competitive relationship between the two countries is highlighted by the advantage Chinese airlines receive by continuing to access Russian airspace, while U.S. carriers stopped flying through Russian airspace at the start of Russia’s invasion of Ukraine in March 2022.
Even for those flights not operating through Russian airspace, there is still a competitive disadvantage with Chinese airlines enjoying certain protections stemming from the Chinese airline’s relationships with their government. This allows Chinese airlines to operate irrespective of standard market conditions. Much like the current and previous administrations have addressed anti-competitive practices and overcapacity with China, we believe the concerns of U.S. carriers today are no different.
We strongly urge the U.S. government to pause additional flights until U.S. workers and businesses are guaranteed equality of access in the marketplace without China’s existing damaging anti-competitive policies. We ask the government to take the time to address these significant competitive issues and protect U.S. aviation workers, travelers and airlines.
If I’m understanding this correctly, we should be capping flights between the United States and China because:
- It’s unfair that Chinese airlines can use Russian airspace, while US airlines can’t; however, there are many airlines flying to the United States using Russian airspace, ranging from Air India, to Emirates, to Qatar Airways, etc.
- It’s unfair that Chinese airlines are given “certain protections” based on their connection to the government; however, there are many airlines flying to the United States that receive all kinds of government support
Is this honestly the strongest argument that these organizations could come up with against stopping the growth of Chinese carriers in the US? Obviously the motivation here is entirely self-serving:
- China isn’t as lucrative of a market for US airlines as it was pre-pandemic, both due to increased tensions, and due to an economic slowdown in China
- US airlines aren’t even maxing out their existing allocation of flights to China, as there are more lucrative destinations they can fly planes to, especially with the increase in premium leisure demand
- For the flights that US airlines do operate to China, they’re charging way higher fares than they did pre-pandemic, and they want to keep it that way; this stance is about preserving high yields and maximizing profits
- Airlines outside of China have benefited greatly from the lack of nonstop flights between China and long haul destinations, as it has caused people to connect through other airports, pushing up transpacific fares
International travelers would benefit massively from increased transpacific service from Chinese airlines, regardless of whether or not one actually wants to travel to China. Who knows, if Chinese airline capacity is restored, maybe it’ll eventually be possible to find a Cathay Pacific business or first class award seat again.
Bottom line
US airlines want Chinese airlines to be blocked from adding more flights to the United States. US airlines argue that it’s not fair that Chinese airlines can use Russian airspace, or that they receive government support… yet that applies to a countless number of airlines.
The motivation is clear — US airlines don’t want yields across the Pacific to be driven down, so they want to do everything they can to stop Chinese airlines. I’m by no means a cheerleader for China, but c’mon, you’ve gotta make a better argument than this.
What do you make of this request from the US airline industry?
It's amazing how a country built on "capitalism" and "fair markets" complains when it isn't in their favor. Didn't we do this once before (at least) with the car companies...we had our people fly to Japan and complain that the Japanese needed to stop making quality cars at affordable prices because it was cutting into US sales...everything in cycles, right?
The competitive disadvantage?
I paid DL flights for 20k USD one way in J in 2021 and 2022. Price in Y is anywhere from 9k-15k USD.
The cost for Chinese airlines wasn’t any cheaper. You get pretty much no service and interaction between FA and customers in Chinese airlines during pandemic. In fact their working conditions are a lot harder. They quarantined for 2-3 weeks for each flight.
They didn’t treat any...
The competitive disadvantage?
I paid DL flights for 20k USD one way in J in 2021 and 2022. Price in Y is anywhere from 9k-15k USD.
The cost for Chinese airlines wasn’t any cheaper. You get pretty much no service and interaction between FA and customers in Chinese airlines during pandemic. In fact their working conditions are a lot harder. They quarantined for 2-3 weeks for each flight.
They didn’t treat any US airlines crew any bad because they do not have layover in China!!! They did a turn in ICN which requires quarantine for Flight Crew as well.
I think we know that no matter how difficult operation is, airlines will suck as much blood out of customers.
Chinese airlines actually pay their crew very good. Too good for FA imo.
So I don’t see why american carrier are losing competitiveness other than because of union kept on asking for higher and higher salaries
Bunch of nonsense on FA pay. I know several Chinese airline FAs personally and can tell you on average making between 5-9k RMB a month without the benefits that most international airline employees get like ZED fare access.
I actually wish foreign carriers could expand to more cities in the United States. They provide a better service, have a younger workforce, treat passengers better and don’t have workers protected by unions who can be crabby when they want to. Tickets to Asia are ridiculously expensive from the US. In Europe, you can fly to Beijing for $400 to $800. in the US it’s more like $2000 to $3000. Several times I have had...
I actually wish foreign carriers could expand to more cities in the United States. They provide a better service, have a younger workforce, treat passengers better and don’t have workers protected by unions who can be crabby when they want to. Tickets to Asia are ridiculously expensive from the US. In Europe, you can fly to Beijing for $400 to $800. in the US it’s more like $2000 to $3000. Several times I have had to fly to Europe, then catch a different carrier to China to visit family. The US officials need to get there head out of the sand. Stop protecting these monopolistic US carriers
Based on some of these arguments, foreign countries could ban US carriers because they took billions and billions of dollars in Government aid.
The corporations that keep singing the benefits of free markets are the ones who do not like the markets to be free. The loser at the end is the consumer.
china bad actually
Cathay Pacific is a de facto Chinese carrier, and utilizing Russia airspace when flying between (Hong Kong, China) and New York. If U.S. airlines want to limit Chinese carriers flights, why does they give a pass to Cathay Pacific? They should ask DOT to close the loophole, by limit the number of CX passenger flights the same as U.S. carriers offer.
Easy, because Hong Kong and the mainland are on completely separate bilateral agreements to the USA. So "punishing" Cathay, wouldn't mean anything to China or the mainland carriers.
While Cathay Pacific largest shareholder is British firm, Air China is the second largest shareholder, China government exert enormous influence and pressure to CX in the last few years. In fact, many China expatriates living in US/Canada transit at HKG. A good number connect to flights flying other cities in China.
Hong Kong is treated as a different entity because the Chinese are supposed to recognize it's autonomy until 2049, its too bad that they've done several loopholes to undermine this and don't really care about the agreement they signed with the UK.
What benefits customers is more flights to China not less. Let's get some new routes going.
At the very least, there should be no flights between Hong Kong and the USA
Your suggestions would harm United Airlines, which has 3 daily flights from U.S. west coast to (Hong Kong, China). Banning Cathay Pacific flights between U.S. and (Hong Kong, China) from utilizing Russia airspace will level the playing field.
the difference on flights from the US west coast to China and Hong Kong is minimal and well within the range of what the 787 can do.
The real difference comes from the US east coast and is why UA has been unable to fly EWR to HKG as well as BOM. Add in the treaty restrictions that have made UA choose west coast gateways to China at the expense of ORD and EWR,...
the difference on flights from the US west coast to China and Hong Kong is minimal and well within the range of what the 787 can do.
The real difference comes from the US east coast and is why UA has been unable to fly EWR to HKG as well as BOM. Add in the treaty restrictions that have made UA choose west coast gateways to China at the expense of ORD and EWR, and UA's eastern US to Asia route system has been decimated by these restrictions.
CX did fly JFK-HKG respecting Russia airspace restrictions using both the A350-900 and -100 but decided it was too costly to do so in the winter but no longer does so the A350 can fly JFK-HKG w/ airspace restrictions.
DL is increasing DTW-PVG to daily and the A350 has been operating the flight even though DL's current A350s are not the most capable; they just received their first of the most capable versions but it hasn't entered service yet.
The new-ish frequencies previously approved for Chinese carriers in the past year have not used Russian space at all. You can check the routes on FlightAware. This must have been an unwritten concession that the Chinese side made in order to get the additional routes approved in recent months. Older frequencies can still fly through Russia.
So the Russian airspace argument is moot. Any additional routes approved would likely also follow this path with even...
The new-ish frequencies previously approved for Chinese carriers in the past year have not used Russian space at all. You can check the routes on FlightAware. This must have been an unwritten concession that the Chinese side made in order to get the additional routes approved in recent months. Older frequencies can still fly through Russia.
So the Russian airspace argument is moot. Any additional routes approved would likely also follow this path with even the Chinese airlines avoiding Russian airspace.
Benefiting airlines, not consumers, relevant authorities should weight who represents the majority.
Remember that the USA and US carriers did want open skies with China. China refused. We had an agreement that China wanted. Then during COVID China unilaterally forbade US Airlines from flying to China. Then they said that if you didn't fly to China in March then you couldn't fly to China at all, but Chinese carriers could fly to the USA. Well if there's a pandemic and China blocks the airlines, how could they...
Remember that the USA and US carriers did want open skies with China. China refused. We had an agreement that China wanted. Then during COVID China unilaterally forbade US Airlines from flying to China. Then they said that if you didn't fly to China in March then you couldn't fly to China at all, but Chinese carriers could fly to the USA. Well if there's a pandemic and China blocks the airlines, how could they fly there? So now the USA is in control. China did this to themselves so the AA, DL & UA should block all Chinese carriers. They won't get any benefit out of more flights.
Americans only believe in capitalism and competition when they can be on top. World class hypocrites.
Pity the luckless passengers having to pick between flying a U.S. carrier or a Chinese carrier...what a gruesome selection indeed. After you've flown quality South East Asian and Middle East carriers, you'll never want go back to such mediocrity.
Hainan Airlines isn't bad.
Hainan business class was amazing. I've never been on a SEA or ME airline; however, Hainan biz class was MUCH better than any other int'l biz class I've been on (KLM, Delta, China Eastern, American, British, Air France)
I dunno. These comments seem to come up often and I don’t really agree with the sentiment. People saying they’d rather fly on Singapore premium economy or via Dhaka than American Airlines business.
I personally really like American business class and would be happy to fly them to china. I’ve flown china eastern business a few times and the food wasn’t the greatest but the seat was great and the service was decent.
...I dunno. These comments seem to come up often and I don’t really agree with the sentiment. People saying they’d rather fly on Singapore premium economy or via Dhaka than American Airlines business.
I personally really like American business class and would be happy to fly them to china. I’ve flown china eastern business a few times and the food wasn’t the greatest but the seat was great and the service was decent.
I guess it’s what each person prioritizes.
I’ve flown Ana and jal recently and both were pretty meh.
Chinese carriers are not bad. Having flown them extensively, they're better than all except the middle eastern and other Asian carriers.
you might not be wrong, but the only time I saw a FA proactively put on slippers for an elite member was on a CA flight.
Having flown Air China, China Eastern, and Hainan airlines domestically within China, I would choose any of those over a US domestic carrier any day. But I do agree that every other Asian based airline puts our domestic airlines to shame as well.
Agreed!
This is inflationary. I had to book 3 Y tickets for travel to china for $2600 each connecting in ICN. About threw up. So annoyed because there were no direct flight options that were cheap.
There is a point in the Russian airspace issue but this should be fixed another way. Rather than blocking competition, authorities should disallow any flights to/from the US (and EU) to use the Russian airspace, no matter who operates them. It's crazy that we disadvantage our own airlines while letting others fly to our countries with no restrictions. This would further serve as an additional sanction against Russia since they're cashing out fees on these...
There is a point in the Russian airspace issue but this should be fixed another way. Rather than blocking competition, authorities should disallow any flights to/from the US (and EU) to use the Russian airspace, no matter who operates them. It's crazy that we disadvantage our own airlines while letting others fly to our countries with no restrictions. This would further serve as an additional sanction against Russia since they're cashing out fees on these flights (it's a bit ridiculous that we feed Russia's war effort with our money). And finally it's also a matter of safety - we saw what happened in Belarus with Ryanair.
and part of the reason for not allowing a number of western airlines to overfly Russia is because many of those countries have very tenuous relations with Russia - which means that, if a plane diverts to Russia, the ability to take care of those western citizens would be very challenged.
There is no restriction on foreign airlines' ability to carry US citizens in overflying Russia so one way to deal w/ this could...
and part of the reason for not allowing a number of western airlines to overfly Russia is because many of those countries have very tenuous relations with Russia - which means that, if a plane diverts to Russia, the ability to take care of those western citizens would be very challenged.
There is no restriction on foreign airlines' ability to carry US citizens in overflying Russia so one way to deal w/ this could be to say that no airlines can overfly Russia and carry US citizens.
US airlines cannot codeshare on foreign carrier flights that overfly some countries that the US prohibits overflight by US airlines. that rule just needs to be extended to include carrying US citizens
"...we disadvantage our own airlines..." AA, DL, and UA aren't state-owned corporations like most of the Chinese airlines or many of the Middle Eastern carriers; the US Government, i.e., the US taxpayer, doesn't even own a stake in the Big 3 like we see with AF/FLM. These are not " our" airlines per se...and looking at many of the decisions they've made ever since privatization, it's pretty clear they aren't interested in what's always good...
"...we disadvantage our own airlines..." AA, DL, and UA aren't state-owned corporations like most of the Chinese airlines or many of the Middle Eastern carriers; the US Government, i.e., the US taxpayer, doesn't even own a stake in the Big 3 like we see with AF/FLM. These are not " our" airlines per se...and looking at many of the decisions they've made ever since privatization, it's pretty clear they aren't interested in what's always good for the American public...
Anti competition interests?
You'd be surprised to know how many direct flights there are between Canada and China.
How many?
I used to fly CA from SIN-PEK-YUL. Still waiting for that latter leg to return.
10 weekly in total. 1 weekly flight by CA, MU, CZ, HU, 3U & MF. 4 weekly flights by AC.
I believe only 8 or so weekly flights can use Russian airspace (the flights that exist at the beginning of the war) among which only a couple really use it as most others are to the west coast. The other 42 cannot fly over Russia. So the argument itself is fair but heavily/conveniently exaggerated. Until few months ago UA and DL competed for the slots and now the table has turned. Sadly anti-China sells really well in the US these days.
Indeed, all the newly added flights from Chinese carriers cannot use Russian airspace.
For Beijing flight passing though Russia would be definitely faster
True. The 8 flights that can use Russian airspace are:
CA 1x PEK-LAX 1x SZX-LAX
MU 2x PVG-JFK
CZ 1x CAN-LAX 1x CAN-JFK
MF 2x XMN-LAX
https://www.aeroroutes.com/eng/230424-cnns23
Three JFK flights and PEK-LAX still regularly flies over Russia and other four also occasionally use Russian airspace on the way back, so it's more than a few. China could cave in if it wants more flights to the US.
You support your argument that the US airlines are arguing in bad faith by using your presupposed premise that the arguments are in bad faith. Can you provide examples where Chinese acted for the good of a foreign market? All they do is dump cheap items and screw up real estate in foreign countries and cry about restrictions. They always play the victim card while picking on the weaker states like Taiwan.
No need for more flights.
China does not have Open Skies agreements with the US while India, Qatar and the UAE does. There is no less of an issue for US airlines to those countries but there is no recourse short of petitioning the DOT to pull the Open Skies agreements - or buy airplanes that can make the longer flights and then convince customers that their service is good enough to endure an hour or more longer.
and the...
China does not have Open Skies agreements with the US while India, Qatar and the UAE does. There is no less of an issue for US airlines to those countries but there is no recourse short of petitioning the DOT to pull the Open Skies agreements - or buy airplanes that can make the longer flights and then convince customers that their service is good enough to endure an hour or more longer.
and the US-China market is now MORE lucrative but it is smaller because of US-China relations.
China subsidized its airlines - which are state-owned - to the tune of billions of dollars which cost AA multiple routes and UA endured TPAC losses which managed to end when their China flying was cut.
And the Chinese airlines will use their new capacity to connect passengers elsewhere in Asia which will put pressure on TPAC fares which are high.
Let's remember that US airlines are not even using the reduced number of flights they can fly. the market isn't large enough to support a bunch of new service at existing fares.
The US carriers are justified in asking for caps. It might not be a good political move in 2024 for the administration to not do what is asked given how loud airlines can be and how large their employee groups are.
Tim Dunn is on to something.
"China subsidized its airlines to the tune of billions of dollars."
Heck yeah, America bailout its airlines to the tune of $54 billion dollars. Not the first bailout, and definitely not the last one.
Take that China.
Did you just rewrite the whole article?
Penalize all airlines using Russian airspace equally. If you use Russian airspace, you don't get to use USA airspace, period, no exceptions.
Then move on to other questions.
Right, and tell the world that the greatest nation is just a schoolyard bully. I'm a big badass 5th grade and your tiny 2nd grade cannot use the playground. And if anyone let a 2nd grade play, you won't be invited to my birthday party.
And oh the reason I bully 2nd graders is because their cousin is having issues with the neighbors of my 3rd grade puppets who lives more than thousands of miles away.
This is what you teach your kids?
They don’t want the capacity dumping and sub-$500 transpacific fares (except to Japan/Korea b/c ppl don’t like backtracking) to return lol. Altho, given China’s change in situation I doubt a lot of former 2nd & 3rd tier city flights would return. I think the restriction that Chinese airlines also not use Russian Airspace is a fine compromise (altho even that penalizes the chinese airlines unfairly compared to say Air India)
Yes, that is the only reason.
They don't want to lose a revenue "premium" by charging 3x-4x of what they could before the pandemic.
Everything else is BS.
DOJ can only help the domestic legacies by slowly double killing JetBlue and Spirit.
DOJ can't help you with China.