Delta Retains Rights for Seattle – Tokyo Service

As per the US-Japan bilateral agreement, US airlines may only operate a total of four daily round-trip flights at Haneda Airport. Currently that service is provided by Delta Air Lines from Los Angeles and Seattle, Hawaiian Airlines from Honolulu, and United Airlines from San Francisco.

US major Delta Air Lines will be allowed to continue operating the Seattle – Tokyo Haneda route, although the United States Department of Transaportation (DOT) has said it will face strengthened conditions and protective measures to maintain a year-round daily service in the market. Should Delta not meet the additional conditions and requirements tentatively attached to this slot pair authority, the DOT has tentatively selected American Airlines for backup authority for these traffic rights for its proposed Los Angeles – Haneda proposal.

As per the US-Japan bilateral agreement, US airlines may only operate a total of four daily round-trip flights at Haneda Airport. Currently that service is provided by Delta Air Lines from Los Angeles and Seattle, Hawaiian Airlines from Honolulu, and United Airlines from San Francisco. However, in December last year, the DOT instituted a carrier-selection proceeding to determine whether current service between Seattle and Haneda should be reallocated to another airline after the US major reduced its frequency from daily to a basic seasonal schedule.

Both American Airlines and Hawaiian Airlines submitted applications to the DOT in January 2015 to take over Delta Air Lines’ route authority to serve the Japanese market and launch their own Transpacific routes using this licence. American proposed to operate a daily, year-round, non-stop service between Los Angeles International Airport and Tokyo's Haneda Airport. Hawaiian planned to begin daily, non-stop service this summer to Tokyo Haneda from Kona International Airport on Hawaii Island.

In its ruling the DOT said it had selected Delta to retain the traffic rights because it found its proposed service “would address a variety of public interest goals and would best maximise public benefits.” The Department specifically noted that the Seattle-Haneda service would “establish a new gateway to Haneda” by providing the first nonstop Haneda service on a significant mainland US-Tokyo route that then lacked any such service. The Department also found that Delta’s proposed service “would further serve the public interest” by providing a number of western cities with their first one-stop connecting opportunity to Haneda, and that other cities would gain the option of service over a less circuitous northwest gateway.

Beyond that, the Department determined that an outcome that would bring first-time Haneda service and first US-flag Haneda service to the sixth-largest O&D market, while also promoting the geographic diversity of the US-Haneda gateways, would be consistent with its established approach for the award of limited Haneda slot opportunities and would best serve the public interest.

“No party to this proceeding has persuasively demonstrated that the above-listed Seattle-related attributes and public benefits that were central to the Department’s previous selection of a carrier to provide Seattle-Haneda service were unsupported on the record,” said the DOT in its ruling. “On the contrary, the Department tentatively believes each public interest element cited in justification of its previous decision to favour a Seattle-Haneda selection was valid then, and is still valid on the current record.”

According to the Department the only concern in its reselection of Delta for the rights was whether it could rely on the carrier to deliver the public interest benefits for the Seattle-Haneda route that were central to its previous decision and remain just as critical to the present decision. However, the US carrier has said it will resume a daily link on the route from March 29, 2015 and to continue that daily service not only through the summer season but also through the following Winter season.

"Delta thanks the US Department of Transportation for its tentative decision to allow the airline to continue its service between Seattle and Haneda Airport in Tokyo,” Delta said in a statement. “Earlier this month, Delta resumed its nonstop service between Seattle and Haneda after a temporary seasonal suspension. Delta will operate year-round, nonstop flights between Seattle and Haneda as we continue to grow Delta's international gateway at Seattle-Tacoma International Airport.”

Despite the assurances, the DOT has placed hefty restrictions on Delta to maintain the promise of daily year-round flights. In its ruling it said the carrier must maintain this level of operation or lose the rights completely.

According to the Department, any failure, without a Department-granted waiver, to perform a flight, on each and every day of every week (7 days a week, 365 days a year), will constitute a violation of Delta’s authority, while any failure to perform flights on two days of any seven-day period (365 days a year) will constitute a default of Delta’s authority and that authority will automatically expire.

Hawaiian Airlines President and chief executive officer, Mark Dunkerley has said the decision to re-award the rights to Delta and install American as a back-up should the airline fail to meet its requirements is “tremendously disappointing”.

“Hawaiian is the only airline to have operated Haneda service continuously and successfully since the slot rights were granted. Our proposal provided more seats and would have resulted in more travellers flying between Japan and the United States than either Delta's or American's proposal,” he said.

“Kona is the largest unserved market in this proceeding, and Hawaiian's proposed route would have generated more economic benefit than that offered by either Delta or American. Sadly, by dismissing Hawaiian's proposed Kona route as just simply being additive to the routes already serving Hawaii, the DOT has once more failed to appreciate the geography of the 50th state,” he added.