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United Airlines Pays a Price for Being No. 1 in China

Stocks in this article: DAL UAL

United also is restructuring its Tokyo Narita operations. It has dropped Seattle-Narita; dropped Narita to Bangkok, Taipei and Hong Kong and down-gauged Tokyo-Seoul. The aircraft are moving to new routes such as SFO-Taipei as well as Houston-Munich, which began Thursday.

Going forward, United will rely more on partner ANA at Narita, Compton said. ANA re-timed its flights from Narita to Bangkok and Jakarta, improving connections for United passengers. In the current quarter, United expects connections on ANA to increase by 30% from the same quarter a year earlier.

As for Delta, first-quarter results in Asia provide one more example of how this is a time when everything seems to be going right.

"One bright area in the Pacific portfolio has been China, with all of our China market showing year-over-year unit revenue gains despite a 15% capacity increase," Bastian said. One advantage: The big three Chinese carriers are all members of the Skyteam Alliance, which enabled Delta to benefit from "continuing to work with our Chinese partners on improving our connectivity and our schedules to interior China," Bastian said. Delta also secured better slot times in Beijing, he said.

American said its Pacific PRASM grew 9%, but President Scott Kirby stressed on the American earnings call that comparisons are not meaningful. He said American's presence in China is small, so that it benefitted disproportionately from improved slot times, as well as from increased share.

In the first quarter, United suffered in China from two harsh realities. One is that this appears to be Delta's time in the airline business, in China as well as elsewhere. The other is that it's always tough to be number one, which provides so much more opportunity to disappoint.

Written by Ted Reed in Charlotte, N.C.

To contact this writer, click here.

Follow @tedreednc

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