This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Flying Between U.S. and China Is Booming -- Too Bad It's Not Profitable

Stocks in this article: AAL DAL UAL BA

Chicago (TheStreet) -- U.S.-China flying is the wave of the future. It is expanding rapidly, never more rapidly than this month. Airports welcome the service, passengers love new non-stop destinations and airline crews tend to be proud to work the flights.

It's just too bad that in general air service between the U.S. and China is not yet profitable.

Eleven days in June were the most important period for China/U.S. aviation since the historic 2007 bilateral agreement vastly expanded flying between the two countries.

On June 9, United (UAL) began thrice-weekly service between San Francisco and Chengdu, the first commercial aviation flight ever between North America and the interior to China. On June 11, American (AAL) added flights from Dallas to Hong Kong and Shanghai. On June 16, Delta (DAL) launched Seattle-Hong Kong service. On June 20, Chinese carrier Hainan began Boston-Beijing service, which will be daily for much of the summer.

Not to mention the Honolulu-Beijing service that Hawaiian (HA) began on April 16, three months after Air China began Beijing-Honolulu service.

"Everybody wants more access to China," said aviation consultant Bob Mann. "The conundrum is that there's already too much. The amount of capacity in the market is outstripping the demand."

Mann compared China flying to gold mining. "You dig a hole for a while. Eventually you hopefully reach your goal: making money."

In the four years from August 2010 through August 2014, the number of flights between China and Hong Kong, and the U.S., increased by 73% and capacity as measured by available seat miles grew by 58%, according to statistics compiled from schedule databases. Hawaii service is not included in the statistics.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs