This Day On The Street
Continue to site
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

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

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 - Get Report) 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 - Get Report) added flights from Dallas to Hong Kong and Shanghai. On June 16, Delta (DAL - Get Report) 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

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAL $32.80 0.00%
DAL $41.75 0.00%
UAL $44.99 0.00%
AAPL $93.24 0.00%
FB $117.81 0.00%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs