U.S. Seeks More China Flights

A Level Air Field

In a press release dated Feb. 7, the Chinese Civil Aviation Administration said that while "the new round of bilateral aviation talks between U.S. and China failed to bear any fruit," the two sides agreed to keep talking.

The agency said U.S. negotiators want to "fully liberalize" the market, but Chinese officials believe it is too early because Chinese airports are congested. Additionally, the release said Chinese airlines are disadvantaged in the U.S. market, where Air China lost $600 million in 2005. Nevertheless, China "stressed its intention to continue" the talks, the release said.

According to Steinberg, "a fully liberalized agreement will benefit China as much as the United States [because] aviation is an enabling industry that helps other forms of commerce, and the Chinese need to understand that aviation is part of the overall economic relationship."

The U.S. would benefit, he said, because professional services is one of the few areas where a trade surplus with China exists, and more flights would enable more professionals to visit. For the Chinese, Steinberg said, a single widebody flight would bring an estimated $200 million to $250 million in economic benefit. "That should eclipse all other issues," he said.

Chinese carriers would also benefit. Currently they don't fully utilize their U.S. rights: Steinberg said the U.S. would welcome more service and would help the Chinese to develop it. He said Chinese carriers could enhance their ability to form partnerships with U.S. carriers, while marketplace competition could encourage them to develop a premium product.

The Chinese have also objected to visa restrictions for Chinese citizens. Steinberg said that while security concerns have prompted changes in U.S. visa policy, none is exclusive to the Chinese. In any case, it should not be assumed that U.S. travelers are less likely than Chinese travelers to select a Chinese airline. The success of carriers like Cathay Pacific and Singapore Airlines indicates that U.S. travelers "will fly on the highest-quality airlines, sometimes on a U.S. carrier and sometimes on an Asian carrier," he said.

American(AMR Quote) is also hopeful the negotiations over increased flying will continue, said Don Casey, managing director of international planning, in an interview. More talks would provide an indication that the Chinese "are at least considering the issue," he said.

Casey said that the issues raised by the Chinese in the January talks were similar to those raised in 2006 talks, but that the U.S. had newly linked the aviation treaty to the trade imbalance. "That's taking a much broader perspective (than previously)," he said.

Nonstop Flights Between the U.S. and China
Airline	U.S.	China	Weekly Frequencies
American	Chicago	Shanghai	7
Air China	New York	Beijing	7
Air China	Los Angeles	Beijing	7
Air China	San Francisco	Beijing	5
Continental	Newark	Beijing	7
China Southern	Los Angeles	Guangzhou	5
China Eastern	New York	Shanghai	4
China Eastern	Los Angeles	Shanghai	7
United	Chicago	Beijing	7
United	Chicago	Shanghai	7
United	San Francisco	Beijing	7
United	San Francisco	Shanghai	7
Note: Northwest utilizes its 21 weekly frequencies to fly daily from Tokyo to Beijing, Guangzhou and Shanghai.