AA to Challenge Continental for 2nd U.S.-China Route

American Airlines said Thursday it is seeking permission for a second route to China and hopes to offer daily nonstop service between Dallas and Beijing beginning in March.

American, the largest U.S. carrier, said it had filed an application for the route with the U.S. Department of Transportation.

The timing would let American benefit from the 2008 Olympics in Beijing and from increased ties between China and corporations based in the Dallas area. Airlines, like other U.S. businesses, are eager to serve China's huge population and rapidly growing economy.

The bid for new China flights pits Fort Worth-based American against Houston-based Continental Airlines Inc., which is seeking approval to fly from Newark, New Jersey, to Shanghai.

The Texas airlines already operate flights to China - American serves the Chicago-Shanghai route, while Continental flies from Newark to Beijing. But both are chasing two early entrants in the market - UAL Corp.'s United Airlines and Northwest Airlines Corp.

Neither United nor Northwest have bid for more China flights, but they have until Aug. 17, a Transportation Department spokesman said. Northwest expects to file, but would provide no details of its proposal, a spokesman said. United said it was still evaluating.

United flies out of Chicago and San Francisco, and Northwest flies from several U.S. cities to China via Tokyo.

American, a unit of AMR Corp., started flying between Chicago and Shanghai this year, shortly after launching service between Chicago and New Delhi. Company officials declined to say whether the Chicago-Shanghai route is profitable, although Chairman and Chief Executive Gerard Arpey said traffic is higher than the airline had forecast.

"The international markets are very important to our long-term future," Arpey said. "Those are big investments for us. It takes time to build them up."

Arpey said he hoped to convince federal officials that service between China and Texas would be more helpful to American consumers than another route from Newark.

Continental could have sought approval to fly from Houston to China. But the airline went back to Newark because of its big hub there and New York's status as a financial center, said spokeswoman Sarah Anthony.

If the Transportation Department approves American's request - there is no timetable for regulators to act - American would fly from Dallas-Fort Worth International Airport to Beijing with 245-seat Boeing 777 aircraft.

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