Although U.S. airlines now have limited access to the three key cities in China, a little known portion of the two countries' historic bilateral agreement provides far easier access to many other locations, as well.
So far, the focus has been almost exclusively on Beijing and Shanghai. By 2009, the six legacy carriers will offer 14 flights to the two cities, assuming tentative route awards are confirmed.
, the parent of United Airlines, will begin San Francisco to Guangzhou flights in 2008.
Long-term, it seems clear that a country of better than a billion people will have more than three airports that are worth serving.
"The historical tendency is for network carriers to start with a presence in the largest cities and then to branch out as traffic grows," said Andrew Steinberg, Transportation Department assistant secretary for aviation and international affairs, in an interview. "That's been the story all over the world."
In 2010, the U.S. and China intend to begin negotiations on an open skies agreement, which would likely provide unlimited access to all Chinese destinations, including the big three cities. In the meantime, under the existing pact, cities in 22 provinces are already covered.
Additionally, seven weekly frequencies (one daily flight) are currently available to cities in seven other provinces -- Fujian, Guangdong (except Guangzhou), Hebei, Jiangsu, Shandong, Tianjin and Zhejiang. In 2008, an additional seven weekly frequencies will become available for these seven provinces.
Any new entrant would likely be welcomed. "The Chinese government has placed an emphasis on building service into the interior regions," Steinberg says. "You'd find both the central government and provincial governments to be supportive of airlines that want to establish nonstop service, including offering financial incentives."
The access to China will only improve. The Chinese intend to build approximately three dozen new airports over the next five to 10 years. And airlines are eagerly awaiting the arrival of the Boeing 787, a long-range airplane with relatively low operating costs that is suitable for thinner markets.
is eyeing the possibility of serving additional Chinese cities, envisioning flights from its hub at Tokyo's Narita Airport.
"There is a class of cities in China that one can fly to without specific authorization," CEO Doug Steenland said recently, on an earnings conference call. There are cities "of 20 million, 30 million populations that are growing economic centers in China that can't quite justify nonstop to the U.S., but where we can aggregate in Japan from all of our U.S. gateways," he said.
Northwest currently operates daily flights from seven U.S. cities to Tokyo, from which it serves 12 Asian destinations including Beijing, Guangzhou and Shanghai.
Other major carriers are growing gradually in China. American Airlines parent
, for instance, offers Chicago to Shanghai service and will add Chicago to Beijing in 2009.
"When you look at current demand levels, once you get past the first three cities, it falls dramatically," says spokesman Tim Smith. Even demand to Guangzhou is only about one-third of what it is for Shanghai and Beijing, he says.
As a result, Smith says, American is "watching the development of markets in other cities," while serving secondary cities in China with code shares. In particular, a code share with Japan Air Lines enables American passengers to connect at Narita for China flights.
The 22 Chinese provinces that currently have open skies access are Anhui, Henan, Hubei, Hunan, Jiangxi, Shanxi, Chongqing, Gansu, Guangxi, Guizhou, Hainan Island, Heilongjiang, Inner Mongolia, Jilin, Liaoning, Ningxia, Qinghai, Shaanxi, Sichuan, Tibet, Xinjiang and Yunnan.