American, Delta And United Fight Just Two More China Flights—They Don’t Want Cheap Fares Back

Before the pandemic, there were more than 300 weekly flights between the U.S. and China. U.S. airlines and Chinese airlines each had about 150. That was probably more than were needed based on passenger demand, and many of the flights were money-losers. American Airlines said that its Chicago – Beijing and Chicago – Shanghai flights were losing tens of millions of dollars and they only flew to China from Chicago because “that was the first slot that we had a chance to get to.” U.S. squatted on the authority to fly to China because China was always going to be the next big thing. And Chinese airlines squatted on U.S. – China routes for a different reason: the Chinese government only permitted one of its airlines to fly an international route. They weren’t allowed to compete against each other. So there was a gold rush to claim routes that they might possibly want in the future. This excess capacity meant cheap fares across the Pacific. And that wasn’t just limited to China as the destination. Connections over China into the rest of Asia became cheap as well. The global pandemic reset things, however. Relations between the U.S. and China strained, and travel between the two countries scaled back. And ‘covid precautions’ led to new flight restrictions. There are now 50 flights a week per side permitted, one-third of prior levels. About 48 operate. U.S. airlines oppose an increase for two reasons: they don’t want more capacity driving down fares, and they argue it isn’t a level playing field because they aren’t allowed to overfly Russia – so their flights from the East Coast are longer, burn more fuel and are more costly. Chinese airlines are permitted to overfly Russia. Air China is requesting just two additional flights across this week and next, associated with President Xi’s visit. U.S. airlines want them classified as charters because they’re afraid approving regular scheduled service would create a precedent of allowing regular flights that use Russian airspace. They don’t want to give an inch in their protectionism. They like travel across the Pacific to be expensive, and for consumers to have fewer options other than them when you do need to travel.