American New Flight From Dallas To Beijing Coming 2015

If there’s one area American has always been weak, it’s with their Asia route network. Their focus has always been on Latin America, where they’re hands down the strongest global airline. Of course weakness in Asia is relative, since US Airways has never operated any service to Asia.

American has certainly tried to increase their presence in Asia, though. Last year American launched service between Dallas and Seoul Incheon, and a few months ago they launched service between Dallas and Hong Kong/Shanghai.

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American’s route network to Asia

The new Dallas to Hong Kong flight was especially exciting for me, given that:

  • Hong Kong is possibly my favorite city in the world
  • It’s operated by a Boeing 777-300ER, which features American’s new first and business class products, making it the only route to Asia so far where that’s the case
  • I love being an Executive Platinum with American since I get eight systemwide upgrades just for achieving the status, and there’s no better use of those than American’s longest route

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Airshow from Dallas to Hong Kong

But as much as I love the route, I have a hard time imagining it will survive. As I explained in my post about the service:

  • Ultra longhaul flying is incredibly difficult to turn a profit on to begin with
  • The plane sits in Hong Kong for nearly 18 hours — Hong Kong is one of the most expensive airports in the world to park a plane, and that doesn’t even account for the lack of utilization of the plane
  • American already codeshares with Cathay Pacific on their well over a dozen flights a day from the US, and most passengers in any given class of service would choose Cathay Pacific over American — the only passengers that would prefer American are those looking to upgrade, and those aren’t exactly the most profitable customers
  • While Dallas to Hong Kong is in many ways strategic since it’s their only hub from which Cathay Pacific doesn’t have service, they’re really isolating west coast flyers, who are forced to backtrack

So I’m quite surprised that American announced a new flight between Dallas and Beijing starting next summer. While it’s still pending government approval and no exact dates have been announced, this is certainly an interesting move. The route will be operated by one of American’s 777-200 aircraft, featuring their new business class product.

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American 777-200 new business class seat

Ultimately I’m thrilled to see new service to Asia, though at the same time I wish we’d see more destinations rather than just more frequencies. American is building a fairly “deep” network to Asia now, with flights from three cities to Shanghai and Tokyo, flights from two cities to Beijing, and flights from one city to Seoul and Hong Kong. Rather than more flights to these cities, I wish we’d see new destinations.

Regardless, I’m happy to see all this new service, especially on reconfigured aircraft. Based on what I’ve heard, American isn’t doing too well on their new routes from Dallas to Asia, given that the load factors are underwhelming and the routes are ultra longhauls, which are difficult to turn a profit on without amazing yields and close to 100% load factors. So I’m curious what American’s play here is — are they investing in the future because they see potential, or…?

What’s your take on American’s new Asia expansion out of Dallas?

Comments

  1. I think this is great as well but let’s be real — between Cathay Pacific and American Airlines on USA-Asia routes, I’d think most of us would prefer using our hard earned aadvantage miles on CX than on AA. 😉

  2. Actually, DFW-HKG is profitable. The business class seats are filled with corporate travelers, who usually pay premium out of company’s pocket. The same business rule applies to airlines too: 20% of customers pay 80% of the bill.

  3. “…the only passengers that would prefer American are those looking to upgrade, and those aren’t exactly the most profitable customers”

    I’m not so sure that’s true. Tall folks trying to fly coach on CX will be very uncomfortable. I realize that’s not your target audience, and sometimes I wonder if you’re even aware coach still exists based on how little you ever talk about it, but that’s still where the vast majority of Americans get their seats no matter where they’re flying.

    “The same business rule applies to airlines too: 20% of customers pay 80% of the bill.”

    I also hear that 80% of business class passengers are nothing but points redemptions, op-ups and other non-revs. Some rules are made to be broken. Other rules are made to be disseminated without even the most minimal pretext of critical thinking.

  4. “I also hear that 80% of business class passengers are nothing but points redemptions, op-ups and other non-revs. ”

    That’s the corollary of “20% of customers pay 80% of the bill” The other 80% are the ones that *don’t* pay the bill.

  5. @ doublejade — Not sure where you’ve heard that, but I know someone that’s very familiar with the details of the route, and it’s certainly not profitable (yet). It takes a lot more than some people paying full fare business class to make this flight profitable. Keep in mind how long the plane sits in Hong Kong — that’s not cheap.

  6. @ Dax — Quite the opposite. I’m thinking specifically of economy passengers. American has 10 across seating in economy, while Cathay Pacific has nine across seating. Yes, you can pay extra for Main Cabin Extra on American, but you can also pay extra for an exit row on Cathay Pacific. That will undoubtedly be a better experience in economy.

  7. I get Dallas being a AA hub but it really seems to be the among the worst place to have this Asia service. Distance wise DFW is one of the furthest locations from HKG and PEK with the exception of the Southeastern USA. It’s not just the west cost that is closer. On the east coast BOS and JFK are also closer. So in terms of connecting feed, I just dont see American getting a whole lot of it. The only reason someone from outside of Texas (maybe with the exception of FL, MS, AR, AL) would take this flight would be if it was well cheaper than the compitition. Otherwise, no one is going to opt to add 1-3 hours of flying onto an already long flight.

  8. @Dan, ATL has tons of flights to Europe, most ATL connections from US to Europe takes additional 2 hours than NYC or Chicago. It does not hurt too much.

  9. I recently booked a trip to HKG and I considered the AA flight from Dallas since I’m based there but business was mostly booked and the price had risen over $3000 from my trip a month before. I checked several days around my target date and business was mostly booked on those flights as well. It would appear that they are getting good bookings in business on this flight.

    On the DFW hub comments, keep in mind that there are a large amount of corporations based in DFW. Those customers value direct flights including directs internationally (including myself.) Toyota is also moving their HQ to DFW so I would expect them alone to drive even more flights to Japan and China. I also know that the Qantas SYD flight is regularly full as well.

  10. AA employees in Korea have been saying they’re going to launch a second route to ICN soon too, although from which hub was not specified. Presumably ORD or LAC though?

  11. This is very interesting to me. I’m targeting an Asia-JFK J/F reward in about 12 months time. The problem is that the timings are awful for my particular needs, the only efficient way to do it is PVG-LAX-JFK (2 redeyes, not a problem in J/F), or PEK-ORD-JFK, which means a morning departure from Asia, which I’m not keen on. I’m actually starting in SE Asia, so if they took the 77W to SIN, DPS or BKK instead of all that time on the tarmac at HKG, I’d be very excited.

    Any idea of the timings of this flight?

    Interesting to see what the second ICN would be, LAX makes sense. Surprised they don’t fly to KIX.

  12. @ Miles — Interesting. If they do launch it, I suspect it would be out of Chicago. LAX-ICN is HIGHLY saturated, between Asiana, Korean, Thai, etc.

  13. @ James — Unfortunately the timing of the flights hasn’t yet been announced, so no clue. I suspect it will be a daytime flight in both directions, similar to their Incheon route. I could be wrong, though.

  14. The second ICN route will be LAX with the 788. AA scored a major Samsung travel contract; it stole it from Korean Air. The agreement includes all Samsung travel to/from Latin America, Texas and the Southeast, and will include Southern California once the LAX-ICN route opens.

  15. Re: timing, the flights start May 7th.

    Will leave DFW at 10.30am, arrive the next day at 1.45pm. Will leave Beijing at 3.45pm, arrive the same day at 5.30pm. Obviously subject to slot allocations.

    DFW-PVG has done well and DFW-HKG is a runway hit, so no surprise AA is confident about adding more Dallas-Asia capacity.

  16. Thanks for the info Miles. Doesn’t quite suit my timings, but at 12 months out from my travel, everything remains on the table.

    788 is interesting. Any details on interior? Presume no F, but 77W/new 772 style J?

  17. So will AA ever release saver awards on these flights??? It’s not to be sitting on over a million miles but when it comes to award travel on AA, who think their flights are only worth standard awards… HA

  18. @ Tony — On their new routes to Asia they’ve actually been pretty good about releasing space immediately when the flights go on sale, so if you book early there’s a good chance you can snag some award space.

  19. @pavel I’d take CX too on an AA award, esp as I could start in SIN, where I’ll be, and also get a few hours having dinner with family in YVR. However, being in Australia means Alaska not only is cheaper to acquire the points, it lets me use the stopover to turn around and fly JFK-HNL/KOA a week later for the same number of points. I was ready to commit murder when I heard AA no longer allowed a gateway stopover. I had it all planned out!

  20. Hong Kong was my favorite city (3 trips including one for six weeks) until I visited Seoul and Tokyo which I think blow HKG out of the water.

    I suppose I would move to Hong Kong before I would move to Seoul (and def before Tokyo) but for general travel I think the other two are clear winners.

    I’m assuming you’ve been to all 3, what is it about Hong Kong that beats Seoul and Tokyo in your opinion?

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