Sat, May 24, 2008
Both Cite High Fuel Prices In Delaying Start
They both fought hard to win approval from the Department of
Transportation to begin service... but now, United Airlines and US
Airways want to postpone starting new routes to China for at least
a year, due to high fuel prices.
The Associated Press reports United' request for a year-long
delay in starting service between San Francisco and Guangzhou was
approved April 25. A request from US Airways, asking for similar
consideration for its Philadelphia-Beijing service, is said to be
forthcoming.
United spokesperson Robin Urbanski said there aren't "strong
enough economics" on the Guangzhou run to offset sky-high fuel
costs, which rocketed above $135 per barrel of oil this week before
slipping back to just above $130.
Similarly, US Airways says its annual fuel cost for the new
route would be more than $90 million -- some $40 million higher
than the airline had computed when it won the route last September.
The carrier had planned to start service in 2009.
"We're optimistic that economic conditions will be on the
upswing in 2010, giving us a better chance of success with our
first route to China," said US Airways President Scott Kirby in a
letter to employees.
American, Continental and Northwest also recently won approval
to begin new China service from the US. For the moment, all three
intend to start those new flights next year, though Northwest did
ask for a waiver to suspend planned daily cargo service between
Tokyo and Beijing.
Delta Air Lines started flights between Shanghai and Atlanta
March 31.
There may be another reason for United and US Airways to hold
off on starting new service to China. As ANN has reported, the two
carriers have been rumored for the past three weeks to be in talks
about a possible merger... though speculation on such a joining has
waned in recent days.
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