Slot Controversy: How U.S. Airlines Compete for Tokyo’s Prime Real Estate

There are a limited number of takeoff and landing slots at Tokyo’s convenient Haneda airport that have been made available to U.S. airlines. These were agreed to between the governments of Japan and the United States, and so the U.S. Department of Transportation had to decide which airlines to let use them.

DOT is supposed to make a judgment about which proposals are best for consumers. If an airline doesn’t want to fly the route anymore, they can stop doing so and return the slots to DOT – who then makes a judgment about what’s best for customers.

American has a joint venture partner in Japan, Japan Airlines. United has a joint venture partner in Japan, ANA. Delta doesn’t have a Japanese airline partner, and DOT gave Delta the most Haneda slots. Here’s what they decided to do:

These airlines are now allowed to serve Tokyo Haneda airport from:

  • American Airlines: Dallas-Fort Worth; Los Angeles
  • Delta Air Lines: Seattle; Detroit; Atlanta; Portland; Honolulu; Los Angeles; Minneapolis
  • Hawaiian Airlines: Honolulu
  • United Airlines: Newark; Chicago O’Hare; Washington-Dulles; Los Angeles; San Francisco

Delta got most of what it wanted, though it didn’t actually use that to grow service in Tokyo. They pulled down Tokyo Narita flying and stopped their connecting flights into Asia. They connect passengers over their joint venture partner Korean Air’s hub in Seoul instead.

However Delta decided that they no longer want to fly Portland – Tokyo Haneda. They asked DOT to allow them to fly something else with those slots instead. That’s not how any of this works. Delta said they wanted to fly to Portland. DOT said that was in the public interest. They did not grant a property right to Delta to do with as it pleases. So Delta gave back the slot, and DOT has to decide what to do with it.

  • American Airlines has asked to fly New York JFK – Tokyo Haneda. Their joint venture partner Japan Airlines already operates the route. This isn’t new competition, it’s another flight from the same group of carriers working together.

  • United has asked to fly Houston – Tokyo Haneda. Their joint venture partner ANA already operates the route. This isn’t new competition, it’s another flight from the same group of carriers working together. And it’s not even more Tokyo service. This would simply let United fly Houston – Haneda and drop service from Houston to Tokyo Narita.

I thought Delta would have a good chance keeping the slot if it proposed a New York JFK flight (a new competitor on the route in an important market, and ironically one with much better connectivity now that the Department of Justice forced American and JetBlue to break up their partnership). But the filing deadline has passed and it appears Delta did not ask for another city with which to use the slot.

The best idea from a public interest standpoint, I thought, would be new service from a market that currently lacks a non-stop to Tokyo.

  • Miami airport doesn’t have a single non-stop to Asia
  • Neither does Orlando
  • Las Vegas has 5 times weekly service to Seoul. In the past it had Hainan Airlines to Beijing, as well as Northwest Airlines and Japan Airlines to Tokyo.

If American Airlines, with a hub at Miami, had proposed to give Miami an Asia non-stop that would have been compelling to DOT, I think. However in offering net new service from New York, American would seem to be offering the better of the two options on the table, although net new service clearly wasn’t a criteria DOT used in awarding slots to Delta in the first place.

Delta also could have tried Miami. They are growing in the market in conjunction with having poached LATAM away from American Airlines as a close partner.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. The DOT has allowed airlines to switch gateways in frequency allocation cases but they are not in this one.

    Delta has a stronger gateway at JFK than AA and or AA plus B6 and that has been true for a decade. For someone reason, Delta didn’t see value in pursuing JFK-HND even though it flew JFK-NRT as part of the NRT hub operation.

    Delta simply decided that it cannot sustain dual airport operations in Tokyo and given that UA does not fly to both London airports even though they could says that Delta’s strategy is congruent w/ how other airlines approach dual airport major global cities.

    Although I agree that Delta would have the best chance of winning JFK-HND now if they apply, they do not appear to be doing so.

    The same DL execs that reportedly said that DL would not apply for another HND route also have said that more ICN flights are coming so DL appears to be focused on building its JV w/ KE – and sees that as more profitable – while still retaining the same number of routes from HND as UA does on its own metal.

    and given that the Japanese government has said that their intention is to shift all longhaul legacy carrier routes from NRT to HND in time, AA and UA’s NRT presence will come to an end at some point.

    Given that UA started the trash talk about getting the ex DL PDX-HND frequency, the chances are very high that they will walk away empty handed as the DOJ is most likely going to award the route to American for JFK-HND.

  2. I disagree, seems there is lots of US based air service from the greater New York area to Japan. There is very little US based service from the middle South to Japan. I think UAL will get it based on that.

  3. @30west – there’s far less service *relative to demand* from New York to Haneda than there is from Houston to Haneda. And there’s connecting flights to Haneda from Houston, Dallas, LA, Atlanta, etc. already.

  4. Miami makes zero sense, IMHO, because U.S. based passengers would have to backtrack to connect. The same is true of Orlando. If one looks at the shortest great circle distance from Tokyo to Sao Paulo, it goes right over New York (not Dallas or Miami). I’m a bit surprised that Delta decided not to apply to serve Haneda from JFK, since it has a far greater source of U.S. feed than does American/JAL. Maybe it feels it has higher and better uses for the aircraft required to provide the service.

  5. I’m baffled by Delta choosing not to apply. They wanted to keep the slot! They have *some* idea of what they would have done with it. Maybe it was just a second daily DTW or ATL and they assumed that was such a low chance of winning they didn’t bother, but still…

  6. The shortest great circle route between Tokyo and São-Paulo is almost right over the North Pole and is 30 degrees east of New York (135E to 45W). That includes a lot of flying over Russia. The fact is that the route is almost halfway around the world so a route close to a great circle can be drawn in many directions. Dallas or Houston would be a better midway point as the flight across the Pacific would not go over Russia. Such a route using great circle routes for Tokyo to Dallas and Dallas to São-Paulo is only about 50 miles more per my calculations. West Coast cities like Seattle or Portland could be used but a city in Texas is a more natural flow point for more of the USA. I won’t talk about weather because that may make Los Angeles a better city in the center. I know that a Brazilian-American friend would be enthusiastic about a non stop flight from Los Angeles to São-Paulo.

  7. I would expect the DOT to award the route to AA to operate JFK-HND. MIA-HND is often talked about but has anyone actually run the PDEW count in that market? Is it even viable? The answer is probably not, or it would have been attempted already, either by JL or AA through a petition to serve HND or just simply add MIA-NRT. There is enough JL connectivity at NRT even though it is the less optimal of Tokyo’s airports.

    Delta got the largest slice of the HND slots because it consolidated there and has no Japanese partner. It clearly doesn’t see JFK-HND as worth it. It seems to have struggled with JFK-NRT when it assumed the route from NW through the merger and ultimately dropped it.

    IAH-HND is already served by NH. There is also UA on IAH-NRT, so that market, while not insignificant, is well enough served. Presumably, UA would just drop the NRT flight from IAH if awarded the HND slot.

    Demand to Japan has climbed steadily since the borders reopened, post-pandemic, but the amount of corporate travel isn’t the driver here. It is leisure and bleisure.

    If AA is awarded JFK-HND, it will be the airline’s second attempt there, though to be fair, when it first got HND slots to operate from JFK in the 2000s, the schedules were terrible. It shifted JFK-NRT to JFK-HND and ultimately dropped Tokyo altogether from JFK. The proposed schedule AA would have if awarded the slot for JFK-HND is better to and from than what it was when it last few there. AA would use the 777-200ER presumably. Perfectly capable for the route (guessing the 77W is not an option as AA only has 20 of those and it requires 2 for a route like this) but with JL operating up to 2 x daily on the 77W now and shifting to the 35K, a 77E would be a substantial reduction in seats, but maybe that is the point and makes the route more economical. AA can only use 777s on JFK long haul. It has a maintenance base at JFK for the 777 but does not have a 787 pilot or crew base there, so for now, the only option is the 777. Given the decision by the regulators to dissolve the NEA, a deeply flawed but otherwise viable venture with some tweaks and more workable, it would seem they’ll toss AA a bone and give them the slot.

  8. DL initially asked for gateway flexibility, yet they didn’t submit a proposal this time for a new frequency from any of the existing airports. Looks like DOT was right to deny DL’s request, since DL wouldn’t have been able to find a gateway to add the flight anyway.

  9. Delta should have continued their PDX-HND service on a narrow guage aircraft which were either capacity-capped or flagstopped in Anchorage to mitigate losses on the route while still keeping the slot out of the hands of their competitors.

  10. @James, why? DL would incur even bigger losses with an ANC stopover. No one flies passenger service to Asia via ANC any longer. We’re not in the 1980s. Delta had few options aircraft wise. Maybe the 332 at best. The reality is DL was losing (YES LOSING) money on PDX-HND, clearly a microcosm of the massive losses DL incurs with its soon to close Seattle hub.

  11. more than a little stretch of the imagination there

    someone is unable to accept that Delta is the only one of the big 3 that has been able to successfully set up hubs in two other low cost carriers’ hubs – SEA for AS and BOS for B6

  12. The pdx-anc-hnd would be interesting. There is currently no alaska japan service. I would suspect japanese summer tourist traffic would be strong on hnd-anc.

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