January 20, 2015

BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Motion and Application of

AMERICAN AIRLINES, INC.

Motion of 

HAWAIIAN AIRLINES, INC.

in the matter of 2010 U.S.-Haneda 

Combination Services Allocation Proceeding

Docket DOT-OST-2010-0018

CONSOLIDATED REPLY OF AMERICAN AIRLINES, INC.

TO APPLICATIONS AND ANSWERS OF 

DELTA AIR LINES, INC. AND HAWAIIAN AIRLINES, INC.

Howard Kass 

Vice President – Regulatory Affairs

Robert A. Wirick

Managing Director, Regulatory and 

International Affairs

Abigail Donovan

Director, Congressional and Federal Affairs

American Airlines, Inc.

1101 17th Street, N.W.

Washington, DC 20036

(202) 326-5153

howard.kass@aa.com

robert.wirick@aa.com

abigail.donovan@aa.com

Charles A. Hunnicutt

Patricia N. Snyder

Jason D. Tutrone

Thompson Hine LLP

1919 M Street, NW

Suite 700

Washington, DC 20036-1600

(202) 263-4189

charles.hunnicutt@thompsonhine.com

patricia.snyder@thompsonhine.com

jason.tutrone@thompsonhine.com
TABLE OF CONTENTS

I. Introduction...............................................................................................1

II. Delta Consistently Has Underutilized the Detroit/Seattle-Haneda Slot Pair It Was 

Allocated, and Its Actions Prevent Maximizing the Public Benefits of That 

Scarce Resource .............................................................................................3

III. American’s Proposed Los Angeles-Haneda Service Is Substantially Superior to Delta’s 

Current and Hawaiian’s Proposed Services and, Alone, Will Maximize the 

Public Benefits ................................................................................................8

A. American’s Proposed Service Will Provide Substantially Superior Competitive 

Benefits to Delta’s and Hawaiian’s Proposed Services................................10

B American’s Proposed Service Will Provide Substantially Superior Consumer 

Benefits to the General Traveling Public Than Either Delta’s or Hawaiian’s 

Proposals......................................................................................12

C. Allocating a Haneda Slot Pair to American for Los Angeles-Haneda Service Will 

Benefit American’s Large Loyal Customer Base.......................................13

D. Allocating a Haneda Slot Pair to American for Los Angeles-Haneda Service Will 

Provide Substantially Superior Benefits to Multiple States 

and U.S. Communities.....................................................................13

E. In Contrast to Hawaiian’s Proposed Kona-Haneda Service, American’s Los 

Angeles-Haneda Service Would Benefit U.S. Passengers.............................14

F. American Will Provide the Largest Continental U.S. Aircraft on Its Los AngelesHaneda Route, Delta the Smallest.......................................................16

G. American’s Los Angeles-Haneda Service Would Provide Superior Cargo 

Capacity to Both Delta’s Seattle-Haneda Service and Hawaiian’s Proposed KonaHaneda Service.............................................................................16

H. American’s Proposed Start-Up Date Is Not a Gimmick; It Is Real, It Is Underway, 

and It Is Achievable........................................................................18

IV. Hawaiian’s Proposed Kona-Haneda Service Offers Little to the U.S. Public – Assuming 

It Could Actually Be Cleared for Takeoff..............................................................19

A. As a Preliminary Matter, the Department Must Ask Whether Hawaiian Could 

Even Start Its Proposed Kona-Haneda Service.........................................20

B. Valuable National Resources Should Be Used to Provide Benefits Throughout the 

United States................................................................................22

1. Hawaiian’s and Hawaii’s Unique Characteristics Only Benefit Hawaiian 

and Hawaii.........................................................................22

2. American’s Service Proposal Provides Benefits Throughout the United 

States and Better Shares the Economic Benefits Associated with These 

Valuable National Resources....................................................22

C. Kona Service Would Provide Virtually No Benefits to U.S. Consumers...........23

1. Only Japanese Tourists Benefit from Hawaiian’s Proposal.................23
2. Hawaiian Neglects Exports of Actual Goods.................................24

D. Reliance on the Japanese Economy and Japanese Tourists Is a 

Risky Proposition..........................................................................25

1. The Currency Exchange Rate Works Against Hawaiian.....................25

2. Contrary to Hawaiian’s Assertions, When All Reasons for Travel are 

Included, Japanese Visitors Actually Spend Less Money in Hawaii than in 

Los Angeles and the Continental United States...............................27

E. Tokyo-Kona Did Not Work for a Japanese Carrier with Fewer Operations, Fewer 

Seats, and Better Access to Japanese Consumers.......................................28

1. Hawaiian’s Numbers Don’t Add Up............................................28

2. The Success of the Honolulu-Haneda Service Cannot Be Replicated in 

Kona.................................................................................29

F. Successful Services Between the Mainland U.S. and Haneda Exist................30

G. Hawaiian Misunderstands Alliances....................................................30

H. Hawaiian Could Start Service Today If It Were Truly Committed to Serving 

Kona-Tokyo (and, of Course, Assuming the Existence of CBP/FIS Facilities at 

Kona)........................................................................................32

V. Seattle Will Continue to Be Well Served to Tokyo If the Department Determines that it 

is in the Public Interest to Reallocate the Seattle-Haneda Slot Pair..............................32

VI. Conclusion...............................................................................................35
1

BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Motion and Application of

AMERICAN AIRLINES, INC.

Motion of 

HAWAIIAN AIRLINES, INC.

in the matter of 2010 U.S.-Haneda 

Combination Services Allocation Proceeding

Docket DOT-OST-2010-0018

CONSOLIDATED REPLY OF AMERICAN AIRLINES, INC.

TO APPLICATIONS AND ANSWERS OF 

DELTA AIR LINES, INC. AND HAWAIIAN AIRLINES, INC.

I. Introduction

This proceeding is one that no one wanted to happen. Not the Department, which prefers 

carrier selection cases for distributing new commercial opportunities to U.S. carriers to 

withdrawing them for under-utilization. Not Delta, which faces the prospect of having the 

Department withdraw one of its two Haneda slot pair allocations. Not American, which prefers 

the traditional method of entry into Haneda – via market liberalization – but has been thwarted 

by a lack of liberalization at the negotiating table, due, in large part, to Delta’s intransigence.

American presumes that Hawaiian also prefers a scenario where carriers and competition, not the 

government, determine the appropriate service levels in the market.

As the Department is well aware, since the American/US Airways merger closed in 

December 2013, returning to Haneda has been a top international priority for the company, and 
2

American has worked tirelessly to gain access to Haneda with American-liveried aircraft.1 Yet,

despite those efforts and a plea from over 100 Members of Congress in support of further 

Haneda liberalization, tangible progress at the negotiating table has been non-existent.2 At the 

same time, Delta, the holder of two of the four Haneda slot pairs available to U.S. carriers, 

published a winter schedule showing just enough Haneda operations to game the dormancy rule 

and avoid an automatic reversion of its Seattle-Haneda slot pair to the Department. With 

difficult bilateral prospects and the flagrant non- and under-utilization of the valuable Haneda 

slot pair, American initiated this proceeding by asking the Department to withdraw the valuable 

slot pair from Delta and reallocate it to American to put that scarce resource to a higher and 

better use (Motion of American, October 2, 2014).

Indeed, American appreciates the Department’s recognition of the extraordinary, even 

unique, circumstances regarding Haneda. These circumstances, where a single carrier 

significantly under-utilizes one-fourth of the total U.S. slot pair allocation and stonewalls 

progress at the negotiating table, is not analogous to other markets such as Brazil, where all U.S. 

carriers who want to serve the market can and do.3This is a unique case where the Department 

should remain focused on what it said in its Instituting Order:

“This proceeding will consider whether the public interest calls for 

permitting Delta Air Lines, Inc. to retain the currently allocated Seattle-

 

1 American has faced criticism of its JFK-Haneda service by the other applicants (DL Consol. Ans. at 3, Ex. 

DL-A-301; HA Consol. Ans. at 54 and Ex. HA-2015A-104-5). The facts are clear: after losing tens of millions of 

dollars on the route and realizing that East Coast U.S. flights to Haneda could not be commercially viable given the 

Haneda curfew restrictions on U.S. flights, American returned its Haneda slot pair so the Department could 

reallocate the frequencies to another carrier and put the slot pair to a higher and better use. Returning the slot pair 

was the right thing to do at the time given the conditions facing the company and the fact that this slot pair 

represents an extremely scarce national resource. American should not be criticized by the other applicants or 

penalized by the Department in this proceeding for doing the right thing and acting in the public interest.

2

In addition, both California Senators submitted letters of support for American’s Los Angeles-Haneda 

service proposal. Senator Feinstein’s letter was previously submitted. Included in this filing is a letter of support 

from Senator Boxer. 

3

See infra at page 8
3

Haneda slot pair for scheduled combination services, or whether the 

public interest calls for an alternative use of that slot pair.”4

Since the December 15, 2014 Instituting Order, each party has had ample opportunity to 

be heard through four sets of written testimony and/or narratives, as well as two sets of exhibits, 

and to critique the other applicants’ proposals. American has proved that its Los AngelesHaneda service proposal is substantially superior to those of Delta and Hawaiian. Therefore, a

Department allocation to American to operate Los Angeles-Haneda service represents the 

highest and best use of the slot pair and is in the public interest.

II. Delta Consistently Has Underutilized the Detroit/Seattle-Haneda Slot Pair It 

Was Allocated, and Its Actions Prevent Maximizing the Public Benefits of That Scarce 

Resource

As the Department undertakes its review of the highest and best use of the Haneda slot 

pair currently used by Delta for Seattle-Haneda service, a threshold issue is Delta’s historical 

record in using that slot pair since the Department’s Final Order in July 2010.5

On this question, the facts are unassailable: Delta, over and over again, made promises, 

both with respect to Detroit-Haneda and Seattle-Haneda, and, over and over again, reneged on 

those promises (Exs AA-301-314). It is also unassailable (and Delta itself even concedes)

6

that 

Seattle-Haneda has not performed well until now (a point it could hardly contest given the 

route’s low to mid-50% average load factor). Delta has abandoned the Seattle-Haneda market 

for weeks and months at a time with no service at all or a skeleton operation designed not to 

 

4 Order 2014-12-9 (“Instituting Order”) p. 8.

5 Order 2010-7-2, July 6, 2010.

6 Delta Response to Evidence Request at 2 (Jan. 5 2015).
4

serve the traveling public, but rather to adhere to the minimal requirements of dormancy rules 

that prevent automatic reversion of the slot pair.7

The specifics of Delta’s failed promises are described in detail in American’s Direct and 

Rebuttal Exhibits8and in Hawaiian's Exhibits.

9

The specifics of Delta’s non-utilization or 

substantial underutilization of this Haneda slot pair are described, as well, in American’s Direct 

and Rebuttal Exhibits10 and Hawaiian’s Exhibits.

11 The historical record is clear and 

incontrovertible.

Delta tries to explain away the poor performance of the Seattle-Haneda route by saying 

that it was not operating its own metal on connecting flights at Seattle, and that the commercial 

incentives of Alaska and Delta were not aligned, and, therefore, its connecting traffic suffered.

12

Now, Delta claims, that, with the introduction of substantial numbers of Delta own metal 

connecting flights in recent months (and more to come), it has had “astounding” results, and 

Delta will be well-positioned at Seattle, and the Seattle-Haneda flight will operate daily, yearround starting March 29, 2015 “and beyond.”

13

While Delta’s argument may sound plausible, a cursory review of the empirical evidence 

reveals that its explanation is inconsistent with the facts and does not hold up to scrutiny:

 Delta’s Seattle “buildup” has been almost a complete competitive overlap of 

the code share service that Delta enjoyed on Alaska before the buildup (and 

continues to enjoy). Only one new unduplicated service was added – Jackson 

Hole, Wyoming – with Tokyo PPDEW of less than one (Ex. AA-R-103-104);

 

7 As the Department noted in its Order denying Delta’s Petition for Reconsideration, citing its decision in 

Order 97-12-19 at p. 6, n. 12, that the Department need not make a determination regarding the dormancy condition 

because “[it is] instituting this proceeding under [its] general powers to review the public interest bases of the 

current awards.” Order on Reconsideration, Order 2015-1-14, January 15, 2015, p. 4.

8 Exs. AA-301-314, and Ex. AA-R-101 

9 Ex. HA-2015A-1002, -1005

10 Exs. AA-309-316, and Exs. AA-R-104-111, Exs. AA-R-126

11 Exs. HA-2015A-1002, -1005

12 Response of Delta Air Lines, Inc. to Evidence Request, p. 2 (Jan. 5, 2015).

13 Id., at 1.
5

 Delta’s other Seattle route to Tokyo – Narita – performed exceedingly well 

(and daily, year-round) before any buildup (Ex. AA-R-105); 

 All of Delta’s other Seattle international routes also enjoyed high load factors 

(even by Delta’s admission) (Ex. DL-205) (and daily, year-round) before any 

buildup at Seattle with Delta’s own metal (Ex. AA-R-105); and

 Delta has, in recent years, cancelled over 30 routes with substantially higher 

load factors than Seattle-Haneda (Ex. AA-R-126).

The facts speak for themselves: before Delta’s own metal buildup at Seattle, all of its 

other international routes performed exceedingly well without Delta’s own metal, except one: 

Seattle-Haneda. Delta’s explanation simply doesn’t hold water.14

Delta then tries again to explain away its poor track record of performance on the SeattleHaneda route by claiming that Seattle-Tokyo is more seasonal than other Tokyo-Haneda 

gateways (Ex. DL-A-302). This is simply not true. As American clearly demonstrated, neither 

Seattle, nor Tokyo, nor Seattle-Tokyo is a seasonal market. Specifically:

 With respect to Seattle in general:

o No other Delta international service at Seattle operates on a seasonal 

basis. All operate year-round (Ex. DL-205).

 With respect to Tokyo:

o No Delta service to Tokyo from anywhere operates on less than a yearround schedule. All operate on a daily basis, except the smallish 

Portland, Oregon market, which operates 5 times weekly in the winter 

(5 times more than the larger Seattle-Haneda market) (Ex. AA-324);

o No airline operating between the U.S. and Tokyo operates less than a 

year-round schedule; and

o No other airlines reduce their Tokyo schedule for the winter (Ex. AA324).

 

14 Indeed, if the summer 2014 Delta own metal buildup at Seattle had the “astounding” results Delta claims, 

and that buildup was and is continuing, why did Delta abandon the Seattle-Haneda route beginning in October 2014 

and continuing for the six-month period through the end of March 2015? By all logical accounts, Delta’s SeattleHaneda service should have continued without interruption, but see Ex. AA-311.
6

 With respect to Seattle-Tokyo:

o ANA operates a Narita service daily, year-round (Ex. AA-R-125); and

o Delta itself operates a Narita service daily, year-round (Ex. AA-R125).

The “seasonality” argument of Delta is sheer fantasy, an attempt to post hoc justify the

poor performance on the Seattle-Haneda route. But it does raise one question: if, indeed, the 

Seattle-Haneda service is seasonal, as Delta claims, what does this portend for Delta’s newest 

commitment to operate that service on a daily basis “...effective March 29, 2015 and beyond”

(Delta Consol. Ans., p. 1), and specifically for the winter 2015-2016 season? And the next 

winter season? Are we going to witness a repeat of this winter when, for months, there was no 

service and only 17 flights in 182 days? Delta’s claim of seasonality demonstrates that, once 

beyond this case, its commitment to operating Seattle-Haneda in the winter will join the litany of 

other unfulfilled Delta Haneda promises.15

Delta attempts to analogize the current Haneda slot pair situation to the Brazil frequency 

allocations regime are equally misplaced. There are simply no analogous facts or circumstances.

Haneda slot pairs and Brazil frequency allocations are worlds apart for at least three reasons:

 First, there are four slot pairs available for U.S. airlines at Haneda; in 

Brazil, originally there were 105 fully unrestricted weekly frequencies 

available for U.S. airlines, then another 49 weekly frequencies were

added.

 Second, every U.S. airline that has sought Brazil frequencies received 

an allocation; in Haneda, every U.S. carrier seeking this Haneda slot 

pair has one slot pair, except Delta, which has two, and American, 

which has none.

 

15 According to the Oxford English Dictionary (Delta’s choice of dictionaries), “beyond” merely means 

“happening or continuing after (a specified time, stage or event).” “Beyond” can mean one day, one week, one 

month. It is not a real, definitive commitment to operate Seattle-Haneda service for any specified time, let alone 

daily, year-round, see Response of Delta Air Lines, Inc. to Evidence Request at 1 (Jan. 5, 2015).
7

 Third, in Brazil, when a U.S. airline was not using its allocated 

frequencies and another carrier requested them, either the U.S. airline 

holding unused frequencies voluntarily surrendered them, or the 

Department reallocated them. (See Order 2008-11-21) In Haneda, 

Delta is squandering one of the four slot pairs and refusing to allow it 

to be put to a use that would “maximize the public benefits of this 

scarce resource.”

So, if there is to be an analogous situation to Brazil, Delta should surrender its Seattle-Haneda 

slot pair to the Department to be reallocated for a higher and better use and in the public interest.

Stripped of its three primary claims – (1) “own metal” buildup; (2) “Seattle seasonality,” 

and (3) Brazil frequencies – all of which the evidence totally eviscerates – and, in light of its 

indisputable abysmal track record of performance on the Seattle-Haneda route and equally 

abysmal utilization of the scarce resource of this Haneda slot pair, Delta falls back, essentially, to

a “trust me” argument that it will live up to its newest Haneda commitment to operate daily,

year-round service beginning “March 29, 2015 and beyond.”

16

This position, of course, raises the question of whether Delta’s commitment, well 

intended or otherwise, is credible or even remotely likely given the realities of the SeattleHaneda service:

 The Seattle-Haneda route has the lowest load factor of any Delta international 

route (transborder excluded) (Ex. AA-R-108);

 All of Delta’s international routes at Seattle experienced exceedingly high 

load factors without any alleged “benefit” from a Delta own metal “buildup”; 

 Delta does not have the opportunity to down-gauge to a smaller aircraft since 

it is already operating the smallest aircraft (on both Seattle-Haneda and 

Los Angeles-Haneda) available for transpacific flights (Ex. AA-R-109); and

 Delta has, in recent years, cancelled over 30 routes with substantially higher 

load factors than Seattle-Haneda (Ex. AA-R-126).

Delta has no realistic option to turn a service with a 56% load factor into a viable route.

 

16 Delta Response to Evidence Request, p. 1 (Jan. 5, 2015).
8

III. American’s Proposed Los Angeles-Haneda Service Is Substantially Superior to Delta’s 

Current and Hawaiian’s Proposed Services and, Alone, Will Maximize the Public 

Benefits

As explained in the Introduction, American filed its October 2, 2014 Application and 

Motion requesting the Department to reallocate Delta’s Seattle-Haneda slot pair to American for 

Los Angeles-Haneda service just after Delta announced its abandonment of the Seattle-Haneda 

market for the winter 2014-2015 season.

17

American did not seek this action out of spite for Delta or to pick a fight with Delta.

American’s decision to seek the requested action was based on American’s structurally inferior

position in Japan and Asia – American being the only U.S. airline locked out of the important 

Haneda market – and its top international commercial priority of improving its presence and 

position in Asia, beginning with Haneda (an own metal presence that is less than Delta and 

United, which enjoy the benefits of inherited incumbency status in Japan). American saw an 

opportunity to allow the public benefits of a valuable scarce resource to be put to a higher and 

better use rather than having them lie dormant and unused for almost six full months.

Delta has attempted to counter American’s request to gain access to Haneda by 

suggesting that it, not American, is “disadvantaged” in Japan because both American and United 

have antitrust immunized alliances, with JAL and ANA, respectively. 

It is indeed novel and fanciful for Delta to try to describe itself in Asia, Japan or Tokyo as 

“disadvantaged.” As American demonstrated:

 Delta has the largest Third/Fourth and Fifth Freedom network in Japan of any 

U.S. airline, with 19 segments from Tokyo and 679 monthly departures (Ex. 

AA-R-112, p. 1);

 

17 Motion and Application of American Airlines, Inc., October 2, 2014.
9

 Delta operates more flights between the U.S. and Tokyo than any other 

carrier – U.S. or Japanese – and almost the same number as JAL and 

American combined (491 for JAL/AA and 486 for Delta) (Ex. AA-R-112, 

p. 2); and

 Delta is four times the size of American in Japan, operating 12 routes to 

Japan, while American operates only 3; and operating 117 weekly flights to 

Japan from U.S. points compared to American’s 26 (Ex. AA-R-113).

So, if any airline is “disadvantaged” in the market, it is American, not Delta.

Moreover, Delta’s “alliance” argument is without merit. At least for American, its Joint 

Business Agreement with JAL (which is extremely beneficial to the market and to consumers)

clearly helps lessen the disadvantage that American has vis-à-vis Delta, but it does not eliminate 

or negate it. In fact, even in an alliance versus alliance comparison, American and oneworld are 

at a disadvantage in Tokyo versus Delta and SkyTeam, both in terms of flights and seats offered

(Ex. AA-R-114).

American’s disadvantage to Delta in Tokyo is, of course, historical. Delta, through its 

acquisition of Northwest, inherited Northwest’s extremely valuable Japan incumbency. Try as it 

may, American cannot overcome, even with a Joint Business Agreement with JAL, that 

advantage in one fell swoop. American must increase its Asia, Japan and Tokyo positions one 

step, one route, at a time.

That is why gaining access to Haneda from an American hub that allows American to 

operate at commercially viable (though not ideal) times, given the current Haneda curfew limits,

is such a priority for American. Gaining access allows American, a new entrant in U.S.-Haneda 

markets, to increase its presence in Japan and provide U.S. consumers an additional travel 
10

option, including American’s customers who today have no Haneda option.18 These are all

important decisional criteria relied upon consistently by the Department in carrier selection 

proceedings.19

But, in truth, this proceeding is not all about American and what is good for American. 

Rather, it is about the best and highest use of a very scarce and very valuable national aviation

resource – one of only four U.S. Haneda slot pairs – and maximizing the public benefits of that 

scarce resource. As we show below, American’s proposed Los Angeles-Haneda service achieves 

that objective far better than either of the other services proposed in this proceeding.

A. American’s Proposed Service Will Provide Substantially Superior Competitive 

Benefits to Delta’s and Hawaiian’s Proposed Services

In addition to providing the U.S.-Haneda market with new carrier service by American, 

reallocating the Haneda slot pair to American will provide substantially superior competitive 

benefits in a number of important areas and at a number of different levels:

 Intra-gateway carrier competition at Los Angeles. American Los AngelesHaneda service would provide first time U.S. carrier competition to Delta 

service at Los Angeles and additional competition to ANA. Because 

Los Angeles is, by far, the largest continental U.S. market to Tokyo and 

Haneda, and the largest U.S.-Haneda market (Honolulu-Haneda) already has 

three airlines competing, there is a need for enhanced competition on the 

Los Angeles-Haneda route (Ex. AA-R-209). Enhancing intra-gateway 

 

18 Delta suggests that metal neutrality means that American and JAL are indifferent as to which carrier flies a 

route and, therefore, American is present at Haneda via JAL (Delta Consol. Ans. At 8-9, and Ex. DL-303). That is 

wrong, and Delta knows it. As American has explained, “metal neutrality” creates economic indifference between 

the partner airlines, but it does not eliminate passenger/cultural preferences for one airline over another. Delta’s 

partner, Virgin Atlantic, could not have proved this fact more clearly when Virgin’s CEO explained why Virgin was 

going to fly certain routes on which, previously, only Delta flew (Consol Ans. of American at 8, Jan. 12, 2015). The 

reality is that American has no access to Haneda, is the only U.S. airline with no own access, and Delta, in addition 

to being the largest airline in the U.S.-Japan market, has 50% of the U.S.-Haneda slot pairs. American is both 

disadvantaged in Japan and locked out of Haneda.

19 Order 2006-9-8, Los Angeles-Puerto Vallarta Combination Service Proceeding, et al., at 12, n. 40 (Sept. 11, 

2006) (adding JetBlue as a new entrant to U.S.-Mexico markets); Order 2000-11-24 at 11; U.S.-China Air Services 

(2001) (Nov. 24, 2000) (adding UPS as a new entrant to U.S.-China markets).
11

competition is an important policy objective and decisional criteria of the 

Department.

20

 Inter-alliance competition at Los Angeles. Currently, both Star (through 

ANA) and SkyTeam (through Delta) operate on the Los Angeles-Haneda 

route. There is no American or oneworld presence. By allocating to American 

a Haneda slot pair to operate Los Angeles-Haneda, the Department would be 

injecting first time, three-alliance competition at Los Angeles (Ex. AA-207 -

208).

21

This inter-alliance competition objective would be extremely important to 

promoting competition. As the Department stated in allocating American a 

Haneda slot pair to operate JFK-Haneda:

As previously noted, Continental (along with United) is a member 

of the Star alliance. Delta is a member of Skyteam. In the overall 

U.S.-Asia market, the Star and Skyteam alliances currently hold 

significant positions. Thus, an award of Haneda rights to 

American here should enhance alliance competition by improving 

the competitive posture of American and oneworld in the U.S.-

Asia market as compared to the Skyteam and Star alliances. An 

award to American would also benefit alliance competition in the 

U.S.-Japan market, where members of the other alliances are 

significant participants. For example, selection of American’s 

New York proposal provides the benefit of head-to-head 

competition with the Narita services offered at JFK by Skyteam 

member Delta and Star member ANA.22

 Inter-gateway Competition with SFO. The Department has traditionally relied 

on improving competition among gateways to increase the overall level of 

competition in a market.23 In this case, an allocation to American of a Haneda 

slot pair to operate Los Angeles-Haneda service would provide a strong 

competitor (American) in the largest West Coast U.S.-Tokyo market to 

 

20 Order to Show Cause, 2005/2006 U.S.-China Air Services Case and Designation, Order 2005-2-14 at 23 

(Feb. 22, 2005); adopted as final, Order 2005-3-40 at 7-8 (Mar. 29, 2005) (relying on inter-gateway, intra-gateway 

competition, and inter-alliance competition in selecting American to provide Chicago-Shanghai service).

21 American exhibit AA-R-124 shows how the Los Angeles-Tokyo market remains underserved compared 

with the Seattle-Tokyo market (Ex. AA-R-124 corrects direct exhibit AA-212, but the corrections do not undermine 

the point of the exhibit).

22 Order to Show Cause, 2010 U.S.-Haneda Combination Service Allocation Proceeding, Order 2010-5-7 at 

11 (May 7, 2010). See also, Order to Show Cause, 2005/2006 U.S.-China Air Services Case and Designation, Order 

2005-2-14 at 24 (Feb. 22, 2005); adopted as final, Order 2005-3-40 at 7-8 (Mar. 29, 2005).

23 Order to Show Cause, 2005/2006 U.S.-China Air Services Case and Designation, Order 2005-2-14 at 23 

(Feb. 22, 2005); adopted as final, Order 2005-3-40 at 7-8 (Mar. 29, 2005).
12

compete with United in the second largest continental U.S. West Coast-Tokyo 

market, San Francisco.24

B. American’s Proposed Service Will Provide Substantially Superior Consumer 

Benefits to the General Traveling Public Than Either Delta’s or Hawaiian’s 

Proposals

American, today, has no own metal access to Haneda. Consumers throughout the United 

States (and Japan) when wishing to travel to or from Haneda are foreclosed from choosing 

American. This not only severely disadvantages American, but, more importantly, severely 

limits the travel options of the entire traveling public, depriving them of greater choice and 

competitive alternatives.

Delta, today, suffers no such disadvantage. Indeed, in addition to being present at seven

U.S. gateways to Tokyo (AA-R-112, p. 1), Delta can offer travelers two Haneda options, 

compared to none for American. Hawaiian, of course, operates from Hawaii, so, in general, its 

Haneda service options for continental U.S. consumers is very limited, but its proposed KonaHaneda service offers no connecting service from or to the continental U.S. (Ex. AA-R-203).

By allocating to American a Haneda slot pair, the Department would be opening the 

U.S.-Haneda market to a third continental U.S. airline service and a new entrant at Haneda, 

thereby greatly enhancing the options of all U.S. (and Japanese) consumers and shippers – an 

important Department carrier selection decisional criteria.25

 

24 Order to Show Cause, 2005/2006 U.S.-China Air Services Case and Designation, Order 2005-2-14 at 23 

(Feb. 22, 2005); adopted as final, Order 2005-3-40 at 7 (Mar. 29, 2005).

25 Order 2006-9-8, Los Angeles-Puerto Vallarta Combination Service Proceeding, et al., at 12, n. 40 (Sept. 11, 

2006); Order 2000-11-24 at 11; U.S.-China Air Services (2001) (Nov. 24, 2000).
13

C. Allocating a Haneda Slot Pair to American for Los Angeles-Haneda Service 

Will Benefit American’s Large Loyal Customer Base

American is the largest U.S. airline by passengers flown, carrying 197 million passengers

in 2014.

26 As the Department is well aware, customers generally prefer to travel on the airline 

whose loyalty program they favor. Today, American’s customers—whether it is the 197 million 

number or less, have no travel option on American if they want to fly to Haneda. They are 

forced to decide to fly to Narita on American or go to Haneda on a carrier other than American. 

That is a decision that inhibits consumer choice and carrier competition. By allocating American 

a Haneda slot pair to operate Los Angeles-Haneda service, the Department would enable 

millions of consumers to have a real choice and substantially improve the U.S.-Haneda 

competitive landscape.

D. Allocating a Haneda Slot Pair to American for Los Angeles-Haneda Service 

Will Provide Substantially Superior Benefits to Multiple States and U.S. 

Communities

American has shown that its proposed Los Angeles-Haneda service will benefit 16 States 

(15 in the summer) and 30 U.S. communities (23 in the summer) (AA-R-203), representing 

195 million U.S. citizens (AA-R-204). Delta’s Seattle-Haneda service benefits only 11 States in 

the winter (14 in the summer) and 13 U.S. communities in the winter (23 in the summer), 

representing 127 million U.S. citizens (35% less than American), and Hawaiian’s one State, two

communities and 1.4 million U.S. citizens (Ex. AA-R-204) (Figure 1).

 

26 American Airlines Group Reports December Traffic Results, http://www.prnewswire.com/newsreleases/american-airlines-group-reports-december-traffic-results-300018860.html.
14

Figure 1

American’s Los Angeles-Haneda Service Will Benefit Most U.S. Consumers

American

Los Angeles-Haneda

Delta

Seattle-Haneda

Hawaiian

Kona-Haneda

States

(winter/summer)

16/15 11/14 1

Communities(excl. gateways)

(winter/summer)

30/23 13/21 2

Population 195 million 127 million 1.4 million

(Exs. AA-R-203-204; Ex. AA-SR-103, 107)

Haneda is, as the Department stated, a scarce resource. It is a national resource. The 

public benefits should be available to as many States and communities as possible, and surely not 

to just one State and two communities. American’s proposed Los Angeles-Haneda service will 

do just that: maximize the overall public benefits and allow them to be enjoyed by the most

States and communities.27

E. In Contrast to Hawaiian’s Proposed Kona-Haneda Service, American’s

Los Angeles-Haneda Services Would Benefit U.S. Passengers

Hawaiian’s proposed Kona-Haneda service would, by Hawaiian’s own admission, consist 

of approximately 96% Japan-originating travelers (Ex. HA-2015A-109). While such a heavily 

disproportionate imbalance of originating traffic may indeed benefit the Hawaiian economy – a 

point American will address below – it provides little or no benefit to the U.S. traveling public

and to the U.S. consumer. Benefitting U.S. consumers and U.S. interests, not Japanese 

consumers or Japanese interests, is the proper purview – indeed, mandate – of the Department. 

There is no question that American’s proposed service will provide substantially superior public 

benefits to U.S. travelers and U.S. consumers than would Hawaiian’s Kona-Haneda proposed 

service.

 

27 Procedures and Criteria for Selecting Carriers for Limited-Entry Markets et al, 51 Fed. Reg. 43180, 43187 

(hereafter the “Policy Statement”); cited in Order 2006-9-8 at 12 n.23, Los Angeles-Puerto Vallarta Combination 

Service Proceeding, et al. (Sept. 11, 2006).
15

In addition, the service export benefit described by Hawaiian needs to be put in context in 

two respects. 

 First, Japanese tourists in 2013 spent an average of $275.70 per day on their 

stays in Hawaii and stayed an average of 5.94 days.28 That spending number 

already was down 11.1% from 2012, in large part because of the depreciation 

of the Yen relative to the U.S. Dollar.29 Because the Yen has depreciated to 

an even greater extent relative to the U.S. Dollar in 2014, that spend rate 

should have fallen even further in 2014, and 2015 looks to continue this trend.

 Second, as Hawaiian acknowledged, Japan tourists also spend and create 

service exports in Los Angeles (Ex. HA-2015A-615). Indeed, they do. 

Although they spend less per day than the Hawaii visitor ($242.00 versus 

$275.70), they stay longer in the U.S. (9.9 days versus 5.94 days).30 So, the 

average spend in the United States of the Japan-originating passenger on a 

Los Angeles trip is 46% greater than the Hawaii spend—$2,396 per trip 

versus $1,638.31

Two additional factors are important to note.

 Japan-originating passengers to Hawaii overwhelmingly stay in Hawaii and 

visit no other State. In contrast, Japanese travelers to Los Angeles visit other 

States and areas, including Nevada, New York, Arizona, Illinois and 

Washington, DC. Thus, the benefits of this service export are spread among 

several States, not just one.

 The primary reason for Japanese travel to Los Angeles is business/

professional/conventions/conferences at 48%. In Kona, the primary purpose 

of travel is pleasure—89% (Hawaii Tourism Authority 2013 Annual Visitor 

Research Report, p. 43). Haneda is clearly the preferred airport for business 

travelers.

 

28 2013 Annual Visitor Research Report, State of Hawaii, Department of Business, Economic Development & 

Tourism, p. 43.

29 Consol Ans. of American at 8, Jan. 12, 2015

30 “Characteristics of Travelers From Japan to Los Angeles,” Los Angeles Tourism & Convention Board, 

Updated September 2014. Note: Statistics for 2013.

31 Hawaiian adjusted its spend figures upward for 2014 (Ex. HA-2015A-601) despite a likely decrease. 

American used the unadjusted spend amounts provided by the Hawaii Tourism Authority.
16

F. American Will Provide the Largest Continental U.S. Aircraft on Its 

Los Angeles-Haneda Route, Delta the Smallest

American initially will operate the Los Angeles-Haneda route with a B777 aircraft with 

247 seats (Ex. AA-103). Throughout 2015, American is refurbishing its B777s with numerous 

passenger enhancements and will increase the seating configuration to 260 seats (Ex. AA-104). 

Delta operates Seattle-Haneda with a B767 configured for 211 seats. American’s proposed 

Los Angeles-Haneda service would provide anywhere from 17.1% (current) to 23.2%

(reconfigured) more seats than Delta. Where entry and capacity are highly constrained, as here, 

the Department “must maximize [its] limited opportunities to enhance capacity.32

The larger American annual seat capacity translates into an additional 125 B767 flights 

and 26,200 seats at the current B777 configuration, and 170 additional B767 flights and 35,770 

seats when the B777 is reconfigured (Ex. AA-R-111).33

G. American’s Los Angeles-Haneda Service Would Provide Superior Cargo 

Capacity to Both Delta’s Seattle-Haneda Service and Hawaiian’s Proposed 

Kona-Haneda Service

American’s B777 is a cargo shipper’s dream. It has abundant cargo capacity even at 

100% passenger load factors (Ex. AA-108). At 100% passenger load factors, the cargo capacity 

of American’s B777 is 43,114 pounds per flight (average both directions, winter and summer) 

versus Delta’s 14,664 pounds (Ex. AA-222). American would provide over 20,000,000 more 

 

32 Order 2007-9-25 at 15-16, In re 2007/2008/2009 U.S.-China Air Services and Combination Frequency 

Allocation Proceeding (Sept. 25, 2007) (selecting US Airways’ proposal to provide 269 seats per flight over 

MaxJet’s proposal to offer 96 seats per flight). See also, inter alia, Order 2006-8-17 at 3, 2006 Guam-Narita 

Allocation Proceeding (Aug. 17, 2006).

33 See Order 2006-8-17 at 3, supra, awarding Northwest 14 Guam-Narita frequencies on the basis that 

Northwest “would offer 27 more seats per flight, which annualizes to nearly 20,000 more seats per year. It would 

also offer more seats per flight in each class of service, thereby providing more travelers with more 

options.” American’s B777 service offers more seats than Delta’s B767 service and more premium seats than 

Hawaiian’s proposed service. (Ex. AA-103; Ex. DL-103, Hawaiian Application on 8)
17

pounds of annual cargo capacity than Delta even at a 100% passenger load factor (Ex. AA-222).

This is a public benefit that the Department has long recognized is important.34

In its Application in this proceeding, Hawaiian provided no information on its cargo 

capacity, despite the clear requirement to do so in the Instituting Order at page 7, item 1.

Therefore, given the high density configuration of Hawaiian’s A330 (294 seats), and the 

extensiveness of Hawaiian’s exhibits, it must be assumed that Hawaiian has no room for cargo 

on these flights or no interest in providing any benefits to the shipping community.35

Even if that were not the case, however, the cargo benefits of Hawaiian’s Kona-Haneda 

service would be extremely limited. Generally, of course, U.S.-Asia cargo is highly directional 

ex-Asia. However, there are substantial cargo movements westbound from the continental U.S. 

to Japan, but far fewer from Hawaii. Indeed, there are significant continental U.S. exports to 

Japan, especially from Los Angeles. In this regard, American at Los Angeles, by operating B777 

aircraft, would be the superior promoter of U.S. exports to Haneda as between it, Delta and 

Hawaiian, and would provide the greatest public benefits to the shipping community. In addition, 

with respect to inbound cargo from Japan, many of those shipments are semi-finished goods that 

require completion or enhancements at U.S. companies. This work is located in the continental 

U.S., not Hawaii, so even import cargo benefits U.S. wages and jobs in the continental U.S., not 

(or to a far lesser extent) in Hawaii.

 

34 Orders 90-8-57 and 86-5-43 (requiring consideration of the ability of the selected carriers to move freight 

to and from points beyond their proposed hubs).

35 Hawaiian clearly understands the requirements of Order 2014-12-9, including the requirement to specify 

cargo capacity. In its August 27, 2012 Application for Kona-Haneda service, Hawaiian complied with this 

evidentiary requirement. At Exhibit HA-App 2012-3, it estimated the cargo capacity at 21,160 pounds per flight. 

(Application of Hawaiian Airlines, Inc., Docket OST 2010-0018, August 27, 2012). Even assuming, arguendo, that 

Hawaiian remains interested in cargo for its proposed Kona-Haneda service, its cargo capacity would be less than 

50% of American’s, and American would provide more than 10,000,000 more pounds of annual cargo capacity than 

Hawaiian.
18

H. American’s Proposed Start-up Date Is Not a Gimmick; It Is Real, It Is 

Underway, and It Is Achievable

Finally, American addresses its proposed start-up date of 60 days after the issuance of a 

final order in this proceeding (See Application of American, at 2-3). This start date commitment 

clearly reflects American’s strong commitment to the Los Angeles-Haneda route and the priority 

that American’s management places on gaining access to Haneda.

Both Delta and Hawaiian attack American on its proposed start-up commitment date and 

claim it is unrealistic and intended as a gimmick (Ex. HA-2015A-907). In reality, nothing could 

be further from the truth, as we show below. 36

The Department should rest assured that American did not select 60 days by chance or as 

a gimmick. That date was decided upon after internal discussion about the scarcity of this 

resource, the importance to American of gaining access to Haneda, and what date was achievable 

so that American’s commitment and credibility would not be at risk. American is submitting the 

testimony of Suzanne Boda, American’s Senior Vice President, Asia, Canada, Europe and Cargo

(Boda Testimony, AA-ST-1). In her testimony, Ms. Boda recounts her experience in opening 

new stations in her over 30 years of working in the airline industry, of working for Northwest

and living in Tokyo, and her responsibilities in starting this Los Angeles-Haneda service from an 

operations perspective. Ms. Boda explains that it was her decision to approve a 60-day start-up, 

based on her experience in Japan and what she knows has to be done. Ms. Boda explains that 

work has already begun on start-up tasks—not to be presumptuous of a Department decision to 

allocate this Haneda slot pair to American, but to be well prepared and ahead of the curve if that 

occurs.

 

36 Delta Consol. Ans. At 8
19

The American firm 60-day start date is in remarkable contrast to Hawaiian’s shifting 

answers to a start date:

“...on or about June 1, 2015 or approximately 90 days after Hawaiian 

receives the [allocation]...” Application of Hawaiian, p. 5 (emphasis 

added)

"It would be Hawaiian’s recommendation that the Department specify a 

date [to start service] no earlier than 90 days after issuance of the final 

order...” Application of Hawaiian, p. 9 (emphasis added)

“Hawaiian reserves the right to ask for delay of the startup date should any 

court proceeding be instituted to review an award of the frequency to 

Hawaiian until such time as the case is resolved.” Application of 

Hawaiian, n 6, p. 7 (emphasis added)

Thus, Hawaiian’s start date could be years away, while American’s is firm at 60 days 

after issuance of a final order. The public benefit is maximized by an earlier start date.

IV. Hawaiian’s Proposed Kona-Haneda Service Offers Little to the U.S. Public—Assuming 

It Could Actually Be Cleared for Takeoff

Hawaiian has made its case for a fourth service between the State of Hawaii and Haneda. 

Currently, three Haneda services are operated at Honolulu—by ANA, JAL and Hawaiian.

Hawaiian’s proposal is to begin service at Kona, on the Island of Hawaii. It would be the only

non-preclearance international flight at Kona and the first since JAL terminated its service to 

Tokyo in October 2010.

As American shows below, there are numerous reasons why Hawaiian’s Kona-Haneda 

application falls short of delivering the superior public benefits that American’s Los AngelesHaneda service will provide.
20

A. As a Preliminary Matter, the Department Must Ask Whether Hawaiian Could

Even Start Its Proposed Kona-Haneda Service

Before the Department analyzes the merits of Hawaiian’s application, there is a 

substantial threshold issue: if the Department were to reallocate this valuable slot pair to 

Hawaiian, could Hawaiian even operate the flight given the lack of a U.S. Customs and Border 

Protection (“CBP”) Federal Inspection Services (“FIS”) facility in Kona?

In its 241-page Answer, Hawaiian is completely silent about the lack of a Kona FIS 

facility even though the issue was raised previously and, surely, Hawaiian must be aware of this 

pre-flight precondition.

37 Unquestionably, Hawaiian knows that, on December 24, 2013, the 

Director of CBP Field Operations in San Francisco denied a request by the State of Hawaii 

Department of Transportation to reopen the international arrivals inspection facility at Kona 

“without meeting current CBP Airport Technical Design Standards (ATDS) for passenger 

processing facilities.”38

The CBP San Francisco Field Operations Director’s letter also notes that the State of 

Hawaii requested a waiver from CBP Headquarters in Washington, D.C. Over one year later, 

there has been no grant of this waiver, and there likely will not be. As explained in the letter:

Until I hear from CBP Headquarters about the waiver request, CBP 

will continue to provide general aviation arrivals, cruise vessel 

arrivals and limited cargo-related clearance services to Kona. Since 

the 2010 termination of international commercial arrivals in Kona, 

CBP has maintained a small staff to perform these limited 

operations, while the majority of the pre-2010 staff was reassigned 

to other locations at agency expense.39

 

37 Hawaiian’s omission is surprising given the issue was raised in the last Haneda Proceeding. E.g., Order 

2012-11-12 at 4.

38 Letter from Brian J. Humphrey, U.S. Customs & Border Protection, to Mayor Kenoi, County of Hawaii, 

Dec. 24, 2013. Ex. AA-SR-101.

39 Id.
21

Based on its own inquiries to CBP, American believes that CBP has taken no action on the 

waiver request. A January 28, 2014 and a January 7, 2015 article confirm American’s belief.

40

In addition, assuming arguendo that a waiver would be granted, which is not likely, there 

remains the serious question of staffing, resources (human and technological) and the time that it 

would take CBP to allocate (actually, reallocate) resources within its already strained budgetary 

constraints. And, staffing Kona would be only one of the many demands or requests of airports

and airlines for increased CBP staffing and resources elsewhere.

While Hawaiian surely knows the status of the State of Hawaii’s waiver request (and has 

not been forthcoming about it), the Department may wish to undertake its own inquiry of 

whether Kona could have the necessary FIS facility and staffing to support scheduled 

international service and, if so, by when. If the Department concludes that Kona will not have 

suitable facilities to support international service in a timely fashion, Hawaiian’s application 

should be dismissed without prejudice to re-file it when appropriate CBP/FIS facilities are online 

and another Haneda opportunity becomes available.

41

Even assuming that the CBP/FIS issue could be resolved to the Department’s satisfaction, 

Hawaiian’s proposal remains far less valuable to U.S. consumers and shippers than American’s 

proposal, and far less beneficial to the United States, in general.

 

40 Jason Ubay, Opening Hawaii’s Kona Airport for International Flights Has Benefits, but Obstacles Remain, 

Pacific Business News (January 7, 2015), available at

http://www.bizjournals.com/pacific/news/2015/01/07/opening-hawaiis-kona-airport-for-international.html?page=all; 

Ex. AA-SR-102. Nancy Cook Lauer, County Seeks International Flights to Kona, W. Hawaii Today (Jan. 28, 2014), 

available at http://westhawaiitoday.com/news/local-news/county-seeks-international-flights-kona; Ex. AA-R-211.

41 The unavailability of Kona CBP/FIS facilities for a long time in the future may explain, in part, Hawaiian’s 

desire to “reserve the right to ask for delay of the startup date should any court proceeding be instituted to review an 

award of the frequency to Hawaiian until such time as the case is resolved.” Hawaiian Application 7 n.6.
22

B. Valuable National Resources Should Be Used to Provide Benefits Throughout 

the United States

1. Hawaiian’s and Hawaii’s Unique Characteristics Only Benefit 

Hawaiian and Hawaii

The State of Hawaii has unique characteristics that set it apart from the continental 

United States. These characteristics clearly work to the benefit of Hawaiian and Hawaii, but 

offer almost no benefits to the other 49 States. Indeed, Hawaiian admits that the money spent by 

Japanese tourists will be “spent in the United States, and more specifically on the island of 

Hawaii.”

42

While true that Hawaii is the largest origin and destination market to Japan, it is also the 

most imbalanced with a one-way directional flow of 95% Japan-originating traffic (Ex. HA2015A-409). 

American is not denying that there are benefits from this unidirectional flow (in the form 

of service exports) and that they are significant for the State of Hawaii, but they benefit only the 

State of Hawaii and no other State. Furthermore, even within the State of Hawaii, there are great 

imbalances, as discussed in Section IV.E.2, below.

2. American’s Service Proposal Provides Benefits Throughout the United States 

and Better Shares the Economic Benefits Associated with These Valuable 

National Resources

Almost all Japanese tourists traveling beyond Kona today remain within Hawaii. By 

contrast, almost two-thirds of Japanese visitors to Los Angeles travel to other communities, visit 

multiple States, and spread the economic benefits far beyond the gateway city. In 2013, 66% of 

Japanese visitors to Los Angeles reported also traveling to other U.S. destinations, including 

 

42 Hawaiian Ans. 31 (emphasis added).
23

34% who traveled to States other than California.43 Such a more balanced relationship of Japanoriginating and U.S.-originating passengers promotes a much fairer distribution of the economic 

benefits associated with a national resource throughout many more communities, and a much 

larger portion of the country.

C. Kona Service Would Provide Virtually No Benefits to U.S. Consumers

1. Only Japanese Tourists Benefit from Hawaiian’s Proposal

Hawaiian’s Answer focuses on its successful Honolulu-Haneda service and what a great 

destination the State of Hawaii is for inbound Japanese visitors. Yet, Hawaiian’s Answer spends 

very little time specifically discussing Kona and the Island of Hawaii and the consumer benefits 

to their residents. Indeed, out of 169 Exhibits in Hawaiian’s Answer, Kona is only mentioned in 

37 of them.

Hawaiian’s Application and Answer carefully skirt the decades of cases, decisions and 

learning on Department decision criteria in carrier selection cases. It is uncontestable precedent 

that, when the Department talks about the public benefits of a service proposal, it is the benefit to 

the U.S. traveling and shipping public on whom the Department is primarily focused. Indeed, 

specifically with respect to Hawaii and Hawaiian’s most recent effort to gain Kona-Haneda 

service, the Department stated:

We have considered Hawaiian’s various objections to our tentative decision, as 

well as the merits of its Kona proposal, and do not find that a different outcome is 

warranted. Hawaiian argues that its proposed Kona-Haneda service would 

generate greater economic benefits than would additional Tokyo service from San 

Francisco. Notwithstanding the positive attributes of new Kona-Haneda service, 

we find that those factors are outweighed by the aggregate of benefits to be 

derived from United’s San Francisco-Haneda proposal. We acknowledge that 

Hawaiian’s proposal would likely prove beneficial to the local and State 

economies; however, on balance, we find that the competitive benefits of new 

 

43 Los Angeles Tourism and Convention Board, Characteristics of Travelers from Japan to Los Angeles 6, 

Sept. 2014 [hereinafter “Japan-L.A. Visitor Profile”].
24

United service to Haneda from its San Francisco hub would make better use of the 

one available slot pair, and is likely to attract the diverse mix of business and 

leisure traffic, originating in the U.S. and in Japan, that will benefit from access to 

Tokyo’s downtown Haneda airport. (See Order 2014-4-6 at 3)

Although Japanese visitors do benefit the local Hawaiian economy, when 96% of the traffic 

originates in Japan, U.S. travelers do not benefit.

2. Hawaiian Neglects Exports of Actual Goods

In proceedings such as this one, the Department places significant reliance on the 

importance and value of cargo and the public benefits derived therefrom.

44 Cargo is an 

important component of the public benefits. Thus, where possible, the Department always 

analyzes the cargo carrying potential of each applicant’s proposed service and what benefits that

new service would offer shippers. In its direct case, American responded to the Department’s 

evidentiary request on cargo, including providing the cargo capacity on American’s B-777 

aircraft at different load factor assumptions. American also provided cargo capacity data on the 

connecting aircraft that will feed the Los Angeles-Haneda service. As noted earlier, Hawaiian 

provided no cargo information in either its Application or Answer. 

In 2013, Hawaii exported less than $600 million in total merchandise, and just 

$86 million of goods to Japan.

45 In comparison, California exported over $168 billion of 

merchandise, including exports to Japan totaling $12.7 billion—over 145 times as much as 

Hawaii.46 These exports represent U.S. jobs and U.S. income and wages for the U.S. citizens 

responsible for creating the exports, the surface transport to get the cargo to Los Angeles, etc. 

 

44 Orders 90-8-57 at 10, and 86-5-43 at 3.

45 See http://www.trade.gov/mas/ian/statereports/states/hi.pdf

46 See http://www.trade.gov/mas/ian/statereports/states/hi.pdf,

http://www.trade.gov/mas/ian/statereports/states/ca.pdf, and http://www.commerce.gov/news/pressreleases/2014/02/11/sixteen-states-achieve-record-export-levels-2013. California was one of 16 different States that 

set export records in 2013. Hawaii was not one of them. Also, the Los Angeles metropolitan area alone was 

responsible for exports of over $76 billion—over 125-times the amount of exports as the entire State of Hawaii.
25

These are meaningful and real U.S. public benefits, and American’s service proposal provides a 

cargo shipment benefit to U.S. shippers and exporters and Hawaiian’s proposal does not and 

cannot. 

That American’s service proposal provides substantially superior benefits for U.S. 

consumers is clear, as shown in Figure 2.

Figure 2:

American’s Service Proposal Provides Superior Benefits to U.S. Travelers and Shippers

Summary of Consumer Benefits between 

Hawaiian’s Proposed Kona Service and American’s Proposed Los Angeles Service

Benefit/Beneficiary Hawaiian (Kona) American (Los Angeles)

Travelers 4% U.S.-originating 34% U.S.-originating

Business Travelers 6% 48%

Leisure Travelers > 90% 33%

States Hawaii 16 States with online connecting services

Communities 2 25 summer/32 winter

Cargo Exports $86 million $4.6 billion

Cargo Imports Negligible ~$3 billion

Source: Hawaiian Tourism Authority 2013 Visitor Research Report, Japan-L.A. Visitor Profile, 

http://www.lawa.org/welcome_lax.aspx?id=776.

D. Reliance on the Japanese Economy and Japanese Tourists Is a Risky 

Proposition

Although it is true that, when tourists spend money in Hawaii, or anywhere else in the 

United States, it is considered a “service export,” but it could be a problematic proposition for 

Hawaiian’s proposed Kona-Haneda service to rely almost exclusively on Japanese tourists.

1. The Currency Exchange Rate Works Against Hawaiian

Hawaiian goes to great lengths to demonstrate the large number of Japanese tourists that 

will visit Hawaii, the amount of money these Japanese tourists will spend, and the resulting 
26

70

80

90

100

110

120

1/1/20104/1/20107/1/2010

10/1/2010

1/1/20114/1/20117/1/2011

10/1/2011

1/1/20124/1/20127/1/2012

10/1/2012

1/1/20134/1/20137/1/2013

10/1/2013

1/1/20144/1/20147/1/2014

10/1/2014

Number of Japanese Yen 

to One U.S. Dollar

Date

Hawaiian Begins 

HNL-HND Service

effects on the U.S. economy.47 However, Hawaiian ignores the recent strength of the U.S. 

Dollar—strength which suggests neither the number of tourists, nor the amount of money they 

spend, will be as high as Hawaiian predicts.

The U.S. Dollar is 45% stronger now against the Japanese Yen than it was when 

Hawaiian commenced its Honolulu-Haneda service in November 2010. Indeed, as shown below, 

for much of the time Hawaiian has operated its Honolulu-Haneda service, it has benefited from a 

weak U.S. Dollar against the Yen, which made it much cheaper for Japanese tourists to visit 

Hawaii.

Figure 3:

The U.S. Dollar Is Much Stronger Now 

Than When Hawaiian Commenced Honolulu-Haneda Service

Source: http://www.oanda.com/currency/historical-rates/

The much stronger Dollar makes it much more expensive for Japanese tourists to visit the 

United States. While Hawaii no doubt will remain popular with Japanese tourists, there will 

likely be fewer visitors, who stay for fewer nights and who spend less. In fact, contrary to 

 

47 Ex. HA-2015-600 Series.
27

Hawaiian’s claim that Hawaii-Tokyo traffic is growing, that traffic is less today than it was 14 

years ago (Ex. AA-SR-104).

2. Contrary to Hawaiian’s Assertions, When All Reasons for Travel are 

Included, Japanese Visitors Actually Spend Less Money in Hawaii than in 

Los Angeles and the Continental United States

With a service proposal designed to serve Japanese tourists almost exclusively,48

Hawaiian focuses its claims of economic benefits on Japanese tourist spending.49 This may be 

understandable given that nearly 90% of Japanese travelers to Hawaii go there for pleasure, 

while only 5.6% travel to Hawaii for business-related reasons.50

By contrast, nearly half of all Japanese travel to Los Angeles is business-related (48%), 

with only one-third of travel being for leisure.51 When all Japanese visitors to the United States 

are considered, regardless of the reason for their trip, Japanese visitors to Los Angeles actually 

spend 46% more per trip than Japanese visitors to Hawaii:

Figure 4:

Japanese Travelers to Los Angeles Spend More Money per Trip than

Japanese Travelers to Hawaii

Japanese Traveler 

to Hawaii

Japanese Traveler 

to Los Angeles

Average stay in the U.S. 5.94 days 9.9 days

Average spend per day $276 $242

Total spend during trip $1,639 $2,396

Sources: Japan-L.A. Visitor Profile, supra n.36 at 6-7; Hawaii Tourist Authority, 2013 Annual 

Visitors Research Report 43.

 

48 See, e.g., 2015 Answer of Hawaiian Airlines, Inc., p. 6 (discussing the economic benefits of Japanese 

tourists), p. 9-11 (discussing the number of Japanese tourists visiting Hawaii), and Exhibits HA-2015A-602, -603, 

and -606. See also Exs. AA-R-206 and -207.

49 Ex. HA-2015A-600 Series.

50 Hawaii Tourist Authority 2013 Annual Visitors Research Report, p. 43.

51 Japan-L.A. Visitor Profile, supra n.43 at 3.
28

E. Tokyo–Kona Did Not Work for a Japanese Carrier with Fewer Operations, 

Fewer Seats, and Better Access to Japanese Consumers

1. Hawaiian’s Numbers Don’t Add Up

Hawaiian’s proposed Kona-Tokyo service has been tried before—and failed. All of the 

metrics indicate that Hawaiian’s service proposal sounds eerily like JAL’s failed Kona effort, but 

will be even less successful than the previous failed service.

As described in Ex. AA-R-208, and as shown in Figure 5, below, JAL and JALways

(JAL’s low-cost subsidiary) previously attempted Kona-Tokyo service from June 1996 to 

October 2010. JAL and JALways, of course, are Japanese carriers serving Japanese citizens, and 

they have extensive relationships and tie-ins with tour group operators and wholesalers in Japan, 

from where 96% of the passengers would originate.

Figure 5:

Kona-Tokyo Service Failed with Less than Half the Capacity Proposed by Hawaiian

JAL/JALways

Service

Hawaiian

Service Proposal

Frequency 15/16X per month Daily

Aircraft Size 237 seats 294 seats

Monthly Seats 

(each direction)

3,792 8,820

Average Load Factor 62% actual

(31 months under 50%)

75% projected

Monthly Passengers 

Each Way

2,350 6,692 projected

Sources: Ex. AA-R-208; Application and Consolidated Answer of Hawaiian

If Hawaiian carried the same number of passengers as actually carried by JAL/JALways, 

Hawaiian would achieve just a 27% load factor on its service. To achieve just the 62% average 

load factor that JAL and JALways experienced, Hawaiian would need to carry over 5,400 

monthly passengers each way—more than double what JAL and JALways carried. Yet, 

Hawaiian is projecting to carry nearly triple JAL/JALways experience.
29

Why Hawaiian believes it could succeed where JAL failed, with a larger aircraft than 

JAL (24% larger) and double the number of flights operated by JAL/JALways, is unfathomable. 

Hawaiian’s market projections of a sustainable service are highly unlikely or, as Hawaiian stated, 

academic as opposed to real world.

52

2. The Success of the Honolulu-Haneda Service Cannot Be Replicated in Kona

Hawaiian points to the success of its Honolulu-Haneda service to justify its Kona-Haneda 

service proposal. Indeed, it brags that “an award of the Kona route to Hawaiian will replicate the 

unparalleled success that Hawaiian has had at Honolulu . . . .”

53 But Hawaiian is not applying 

for another Honolulu-Haneda slot pair, and the two markets are vastly different, as shown in 

Figure 6:

Figure 6:

Kona is NOT Honolulu

Honolulu

(O’ahu Island)

Kona

(Hawaii Island)

Total visitors in 2013 5 million 1.4 million

Percent of visitors staying 

exclusively on island

75% 45%

Largest group of tourists Japanese (28%) American (68%)

Growth rate of Japanese tourism 3.5% increase 2.0% decrease

Average length of stay 5.49 days 3.44 days

Source: Hawaii Tourism Authority, 2013 Annual Visitor Report 79.

Kona is simply not as strong a tourist destination as Honolulu, with Honolulu’s fabled 

and varied attractions and shopping (opportunities particularly important to Japanese visitors). 

Kona has a much smaller share of tourists than Honolulu, and a much smaller percentage of 

Japanese visitors, that is only declining further.

54

 

52 Ex. HA-2015A-508.

53 2015 Answer of Hawaiian Airlines, Inc., p. 13.

54 Hawaii Tourism Authority, 2013 Annual Visitor Report, 83-84.
30

In light of this, Hawaiian’s assertion that its proposed Kona-Haneda service would bring 

comparable traffic to its well-established Honolulu-Haneda service is illogical, strains credulity,

and ignores the fact that Japanese tourists are not travelling in droves to Kona or the Island of 

Hawaii. Accordingly, the Department should dismiss Hawaiian’s fantastical claims that Kona 

will be the next Honolulu.

F. Successful Services Between the Mainland U.S. and Haneda Exist

The success of Hawaiian’s Honolulu-Haneda service does not mean that service from the 

continental United States cannot be successful. Hawaiian suggests that “operating a successful 

flight from the continental United States [is] difficult, if not impossible,”

55 then supports this 

assertion with only a disingenuous examination of the five continental U.S. gateways that have 

been awarded Haneda service.56

American agrees that Delta’s Seattle-Haneda service has not been remotely successful. 

Yet a review of the California services offered by both Japanese and U.S. carriers shows high 

load factors and continuous operations by ANA, Delta and JAL.57 The facts starkly contradict 

Hawaiian’s statement.58

G. Hawaiian Misunderstands Alliances

For a substantial portion of its Answer, Hawaiian paints itself as the underdog, leading 

the fight against the large alliances and their member carriers.59

 

55 2015 Answer of Hawaiian Airlines, Inc., p. 3.

56 See Ex. HA-2015A-104.

57 See Ex. AA-R-107, p. 3. United’s SFO-HND service is less than 90 days old and there is no public 

operating data about the route.

58 Haneda services to New York was not successful, as American has explained, because the Haneda curfew 

creates very unattractive—and commercially unviable—operating times for that service from the U.S. East Coast 

(not the entire continental U.S.). This, above all else, led to the decision of American to end JFK-Haneda service. 

But, Hawaiian’s assertion that service to Haneda from anywhere in the continental U.S. cannot be successful is just 

wrong.

59 Answer of Hawaiian, p. 56 (“willingness to challenge the global behemoths”); Ex. HA-2015A-700 Series.
31

Hawaiian is a small carrier by its own design, filling the niche of bringing people to and 

from Hawaii, and connecting them on a large intra-island route network. Comparisons of its size 

to American are no more relevant than comparing a local restaurant chain to a global restaurant 

franchise.

The idea that Hawaiian needs the Department’s assistance as a small, vulnerable carrier is 

unbelievable given Hawaiian’s position in Hawaii. Hawaiian serves more continental U.S. 

airports to Hawaii than any other airline including, or course, all the U.S. alliance airlines.

60

Moreover, Hawaiian has a virtual monopoly on inter-island service, operating over 84.5% of 

intra-Hawaii seats.

61

Finally, in stating that “JAL and American function as a single economic entity and have 

every advantage of incumbency, including two Haneda-U.S. frequencies,”

62 it is evident that 

Hawaiian misunderstands the unique operating conditions at Haneda.

Haneda is different. Alliance cooperation that routinely takes place in global hubs such as 

London Heathrow, New York-JFK, Paris-CDG, and even Tokyo-Narita cannot take place at 

Haneda. Like Delta and United, American works with its alliance partners at airports around the 

globe to optimize schedules. Frequently this means pooling or sharing slots at these airports for 

the benefit of the immunized relationship. None of this is possible at Haneda. Both Japanese 

and U.S. carriers are each limited to a total of four flights per side with strict restrictions on 

operating times. There is no ability of alliance partners to trade, swap out of curfew, sell, or 

otherwise improve their schedules.

 

60 Source: Diio Market share data

61 Ex. AA-SR-105.

62 2015 Answer of Hawaiian Airlines, Inc., p. 43.
32

The only relevant measure at Haneda is which U.S. carriers have slots and which do not. 

In this case, Hawaiian already serves its primary international gateway at Honolulu, while 

American has no nonstop service from its only West Coast U.S. gateway.

H. Hawaiian Could Start Service Today If It Were Truly Committed to Serving 

Kona-Tokyo (And, of Course, Assuming the Existence of CBP/FIS Facilities at 

Kona)

Hawaiian states multiple times that its lack of service to Narita gives it incentive to make 

its Kona-Haneda service work.63 Hawaiian has it completely backward. If Hawaiian truly 

believes what it has stated about the prospects for Kona service to Tokyo—how large the market 

is, how successful it will be, how strong the local demand is—it can fly that route, from Narita 

today – or as soon as there were operational CBP/FIS facilities open at Kona.

Unlike Haneda, access to Narita is not foreclosed, and Hawaiian is not without the means 

to obtain the authority. In fact, today, Hawaiian is the only U.S. carrier in the U.S.-Japan market 

that does not fly to Narita. If Hawaiian believes in the merits of its Kona-Tokyo proposal, it 

should start service to Narita without delay once appropriate CBP/FIS facilities were in place at 

Kona.

V. Seattle Will Continue to Be Well Served to Tokyo If the Department Determines that It 

Is in the Public Interest to Reallocate the Seattle-Haneda Slot Pair

To be sure, a reallocation of the Haneda slot pair would result in Seattle losing nonstop 

service to Haneda. This is an outcome American wishes could be avoided, and, one day, airlines 

will be free to make those types of decisions without requiring a carrier selection proceeding. 

But, where there are only four Haneda slot pairs available for all U.S. airlines and all of the 

United States, the Department, as it is rightfully doing in this proceeding, must assess what use 

of that scarce resource maximizes overall public benefits. In American’s view, the objective 

 

63 See 2015 Answer of Hawaiian Airlines, Inc., pp. 8, 62-63.
33

evidence of record in this case is that the use of this Haneda slot pair to maximize those overall 

public benefits requires the reallocation of that Haneda slot pair to American to fly the 

Los Angeles-Haneda route.

It seems beyond the pale to argue, however you look at it, whatever perspective you may 

have, that Seattle, unlike the other communities that do have Haneda service, has not responded 

well to Delta’s Haneda service. There should be no attempt to lay blame on anyone—Delta or 

the community—but the facts are unassailable that Seattle has not responded well to Delta’s

service:

 It is not because no U.S. gateway has responded well to Haneda service—all 

current U.S. carrier and Japanese carrier load factors on their Haneda services

are substantially higher than Seattle-Haneda. (Ex. AA-R-1007, p. 3) And the 

Seattle-Haneda load factor is the lowest by a significant margin of any 

international route operated by Delta today (Ex. AA-R-108).

 It is not because the aircraft operating on the route is too large because Delta 

is using the smallest aircraft possible capable of flying nonstop to Haneda—

smaller than any other carrier operating U.S.-Haneda service (Ex. AA-R-109).

 It is not because Delta was not flying its own metal connections to Seattle 

because, throughout the history of the Seattle-Haneda route, Delta had 

abundant connections on Seattle’s hometown airline renowned for its 

service—Alaska Airlines (Ex AA-R-107 at 1)—and Delta’s own metal 

buildup has added only a single unique (non-overlap with Alaska) market—

Jackson Hole—with less than one PPDEW to Tokyo (Ex. AA-R-102).

 It is not because Delta was not flying its own metal connecting services 

because all other Delta international services at Seattle (including SeattleNarita) experienced high load factors without Delta’s own metal (Ex. AA-R107 at 4).

 It is not because Seattle-Tokyo traffic has declined because it has not 

(Ex. AA-R-107 at 2), and, indeed, Delta’s Seattle service to Tokyo’s other 

airport—Narita—had the highest load factor of all of Delta’s long-haul 

international services at Seattle (Ex. AA-R-107 at 4).

 It is not because Seattle is a seasonal market as Delta tries to allege (Ex. DLA-302). All other Delta Seattle flights operate daily, year-round service (AA 

Answer, p. 4).
34

 It is not because Seattle-Tokyo is seasonal because Delta’s own metal SeattleNarita flight operates daily, year-round (Ex. AA-324).

Certainly not to ascribe blame, but, for whatever reason, Seattle, singularly and 

exclusively, has not responded well (indeed, has responded quite poorly) to service to Haneda.

Delta’s commitment to daily, year-round service beginning “March 29, 2015 and 

beyond”64 is premised on Delta’s own-metal connections making a difference. The evidence has 

shown that not having own-metal connections did not in any way produce unsatisfactory results 

for Delta on any other Seattle international route, so there is no reason to believe that having 

own-metal connections will magically repair the 56% load factor of Seattle-Haneda service to 

any position of profitability.

There is also the troubling fact, as American previously stated, that whatever the 

evidence demonstrates, Delta may actually believe its position that Seattle-Tokyo Haneda is a 

highly seasonal market. If that is indeed the case, what does that really portend for daily, yearround service beginning “March 29, 2015 and beyond”? And, what does “beyond” mean and for 

how long?

Most importantly, if the Department were to determine to reallocate this Haneda slot pair, 

Seattle would not lose nonstop service to Tokyo. Quite to the contrary, it would continue to 

enjoy double-daily, year-round Seattle-Tokyo Narita service, operated by Delta and ANA, and 

have access to both those carriers’ alliances, SkyTeam and Star, respectively. Having doubledaily, year-round service by two airlines is a benefit that only six continental U.S. airports can 

claim (LAX, SFO, JFK, ORD, IAD, and SEA) and is a benefit not currently enjoyed by even 

 

64 Consolidated Answer of Delta, p. 1.
35

substantially larger U.S. airports and communities, such as ATL, IAH, DFW, and DTW.65

Thus, while Seattle would lose access to Haneda, it would continue to enjoy double-daily, 

two-carrier access to Tokyo, a still enviable position.

VI. Conclusion

As the Department stated in its Instituting Order, the purpose of this proceeding is to 

“maximize the benefits of a scarce resource” – one of four Haneda slot pairs. American has 

proven that the Haneda slot pair’s current usage by Delta for Seattle-Haneda service has not and 

does come close to that objective and that, of the three applicants’ proposals in this case, 

American’s proposed Los Angeles-Haneda service offers substantially superior benefits than 

Delta’s and Hawaiian’s proposals and fulfills the Department’s objective of maximizing the 

public benefits of this Haneda slot pair. 

 

65 The Port of Seattle’s Answer largely describes Seattle’s economic strength and growth – positions with 

which American is in agreement. However, with respect to Ex-SEA-103, American notes that loss of Delta’s 

Haneda service would not deprive the Pacific Northwest (or Seattle) of a “low-circuity” connection to Haneda. 

Indeed, three other very low circuity options are available: (1) Delta’s Seattle or Portland service to Narita; 

(2) ANA’s Seattle-Narita service; and (3) ANA’s Vancouver-Haneda service, with abundant connections from the 

U.S. Pacific Northwest to Vancouver. Additionally, Seattle’s claim that “SEA is the fastest growing large airport in 

the U.S.” (Ex-SEA-106) may be accurate on a percentage basis, but not on an absolute (numbers) basis. On an 

absolute numbers basis, Los Angeles is the fastest growing airport in the U.S. year over year – 3 million new 

passengers in 2013 over 2012 for Los Angeles compared to 1.6 million for Seattle in the same period – an indication 

of the need for more Haneda service at Los Angeles (ACI 2013 North American Airport Traffic Summary 

(Passengers), Ex. AA-SR-106).
36

For all the reasons set forth in American’s Application, Answer, and Reply, American 

respectfully requests that the Department allocate to American one Haneda slot pair for Los 

Angeles-Haneda service.

Respectfully submitted,

Howard Kass

Robert A. Wirick

Abigail Donovan
1

SURREBUTTAL EXHIBITS OF AMERICAN AIRLINES

2010 U.S.-HANEDA COMBINATION SERVICES ALLOCATION PROCEEDING 

(HANEDA 2014)

Docket DOT-OST-2010-0018

January 20, 2015

Tokyo Haneda

Los Angeles
2

#LetAAFlyHaneda

Exhibit 

Number Title

AA-ST-1 Testimony of Suzanne Boda

AA-SR-101 U.S. Customs and Border Patrol Has Denied Hawaii Island’s Request to Reopen the International Arrivals 

Facility at Kona

AA-SR-102 At Least for the Foreseeable Future, Kona Could Not Accommodate a HND-KOA Flight Because It Does Not 

Have Federal Inspection Services

AA-SR-103 The Public Benefits Substantially Favor American’s 15/16 States Over Delta’s and Hawaiian’s Smaller 

Populations Served

AA-SR-104 Contrary to Hawaiian’s Assertion About the Growth of the Hawaii-Tokyo Market, That Market Is Smaller 

Today Than It Was 14 Years Ago

AA-SR-105 Talk About a True “Domination” – It’s Not Alliances but Hawaiian’s Virtual Monopoly on Inter-Island Hawaii 

Service

AA-SR-106 LAX’s Increase in Passengers in 2013 Was 86% Larger than Seattle’s – Nearly 1.4 Million More Growth 

Passengers

AA-SR-107 Americans Proposed Los Angeles-Haneda Service Covers More States and Communities Than Does Delta’s 

Seattle-Haneda Service

Letter of Support

Surrebuttal Exhibits of American Airlines

DOT Docket OST-2010-0018

Table of Contents

Page 1 of 1
Testimony of Suzanne Boda

Senior Vice President, Asia, Canada, Europe and Cargo

January 20, 2015

My name is Suzanne Boda and I am the Senior Vice President of Asia, Canada, Europe and 

Cargo at American Airlines, Inc. (“American”). In my role, I am responsible for all aspects of 

American’s operation at airports in Asia, Canada and Europe. Prior to assuming my current role in 

December 2013, I served as the Senior Vice President, Airport Customer Service, International and 

Cargo for US Airways since 2008. Before that, I spent nearly 25 years in leadership roles at 

Northwest Airlines (“Northwest”), including working and living in Tokyo supporting Northwest’s 

(now Delta’s) operations in Asia. I have lived in Japan for over five years and am fluent in 

Japanese. 

I submit this testimony in support of American’s Application to begin Los Angeles-Tokyo 

Haneda service and to respond to the questions raised by Delta and Hawaiian about American’s 

proposed startup date of 60 days after issuance of a Final Order by the Department. As a long-time 

visitor and former resident of Japan, I am very excited about the prospects of American returning to 

Haneda and fully share Messrs. Kirby’s and Nocella’s view (expressed in their earlier testimony) 

that the four Haneda slot pairs available to U.S. carriers are valuable national resources that cannot 

be wasted through underutilization. I also hope that the Department recognizes the important 

consumer benefits of having American operate its own aircraft to Haneda. 

As the Department has known for some time, American’s return to Haneda is our top 

corporate priority in Asia. With my own personal experience in the region, I fully understand the 

importance of having a strong presence in Japan as a cornerstone to growing and strengthening 

American’s competitive position throughout Asia. In fact, this is how both Delta (Northwest) and 

United (Pan Am) began decades ago when they established their own Tokyo services. American 

did not get its first Tokyo service until 1987 and even today remains at a substantial competitive 

disadvantage to Delta and United in Asia. 

As part of the Department’s required evidentiary elements, American was asked to propose 

a start date for beginning Los Angeles-Haneda service should the Department award American the 

valuable Haneda operating rights. American’s Application states that, “...American recognizes the 

value of this scarce resource and commits to start service 60 days after the issuance by the 

Department of a Final Order.” Contrary to the allegations of Delta and Hawaiian, the 60-day startup language is real and achievable. I personally approved the inclusion of a 60-day start 

condition because I know, based on my professional experience in Japan that it can be 

achieved. I have tremendous confidence in the American team in Japan and other colleagues upon 

whom I will rely to make the start date a reality. 
Page 2 of 2

I selected a 60-day start up condition because I know that it is important to move fast to get 

American’s proposed Haneda service operating as soon as possible given then there are so few 

Haneda options available for U.S. consumers. Under a different set of circumstances, I might have 

sought a longer start-up date for service, but unlike other new routes, American presently operates 

to Tokyo and has been absent from Tokyo-Haneda for just under two years and thus would not be 

starting from scratch. Moreover, American’s Asia headquarters is located in Tokyo and the critical 

teams to initiate service such as sales, marketing, revenue management, cargo, maintenance, 

technology, station operations, and premium services staff are already in Tokyo supporting current 

operations. Additionally, many of the vendors that American will need to support a Haneda 

operation already provide service to American in Tokyo. For those service providers who are 

unique to Haneda, we are confident they would welcome American back to Haneda, as many were 

utilized during American’s prior Haneda service. 

Given the importance of a new Haneda service to American, I have already begun to plan 

for what I hope will be a mid-2015 service launch. I have asked my “station start-up” team to begin 

reviewing American’s new station checklist. Among the requirements already being reviewed are:

 Automation/IT requirements;

 Support space needs;

 Catering;

 Customs/Immigration;

 Licensing and permitting requirements;

 Maintenance; and

 Cargo.

Additionally, we have already begun discussion with our former ground handler at Haneda –

Japan Air Lines – about ground handling a potential flight. We won’t enter into any formal 

agreements prior to a final Department order, but we want to be prepared to memorialize the terms 

should there be a Department decision to allocate this slot pair to American. 

Finally, because the overall Tokyo market is not new to American and American has served 

Haneda in the past, many of the current American employees in Tokyo have experience working at 

Haneda and are very excited about the prospect of restarting Haneda service. A number of these 

employees have already volunteered to work at Haneda to ensure a smooth start to start this 

important service. 

During my over 30 years in the airline industry, I have opened dozens of new stations. I 

fully understand the work required for a successful launch. I am confident that American will be 

prepared to reestablish Haneda service within 60-days of a final Department decision. 

Respectfully Submitted,

Suzanne Boda
3

#LetAAFlyHaneda

U.S. Customs and Border Patrol Has Denied Hawaii Island’s

Request to Reopen the International Arrivals Facility at Kona

DOT Docket OST-2010-0018

Exhibit AA-SR-101

Page 1 of 1

In Surrebuttal to Hawaiian Answer
4

#LetAAFlyHaneda

At Least for the Foreseeable Future, Kona Could Not Accommodate a

HND-KOA Flight Because It Does Not Have Federal Inspection Services

Opening Hawaii's Kona Airport for international flights has benefits, but obstacles remain

Jan 7, 2015, Jason Ubay, Pacific Business News

Japan Airlines last flew to the then-Kona International Airport in 2010. Uchiyama said the industry did not optimize it at the time.

"Kona was sold as the destination, but this needs to be sold as a Maui, Lanai and Molokai itinerary," he said. Uchiyama said he would like to 

discuss with interisland carriers like Hawaiian Airlines, Ohana by Hawaiian, Mokulele Airlines and Island Air to try to sync outbound flights to 

coincide with international arrivals.

In addition, JAL was the only airline operating an international flight from Kona, and this time around, more than one carrier will need an 

international route to make it viable, he said.

. . . . Kona's airport still needs to clear a few obstacles. The U.S. Customs and Border Protection stopped inspecting commercial flights at the 

airport in December 2012, in part because of an outdated Federal Inspection Service site. For international flights to work, the airport would need 

to be exempt. The state DOT has petitioned Customs and Border Protection for an exemption while it modernizes the airport.

DOT Docket OST-2010-0018

Exhibit AA-SR-102

Page 1 of 1

In Surrebuttal to Hawaiian Answer
5

#LetAAFlyHaneda

The Public Benefits Substantially Favor American’s

15/16 States Over Delta’s and Hawaiian’s Smaller Populations Served

Population of States Served

State

Population

2014 Estimate State

Population

2014 Estimate State

Population

2014 Estimate

Hawaii 1,419,561 Alaska 736,732 Arizona 6,731,484

Arizona 6,731,484 California 38,802,500

California 38,802,500 Colorado 5,355,866

Colorado 5,355,866 Florida 19,893,297

Georgia 10,097,343 Georgia 10,097,343

Idaho 1,634,464 Illinois 12,880,580

Michigan 9,909,877 Massachusetts 6,745,408

Minnesota 5,457,173 Nevada 2,839,099

Nevada 2,839,099 New York 19,746,227

New York 19,746,227 North Carolina 9,943,964

Ohio 11,594,163 Oregon 3,970,239

Oregon 3,970,239 Pennsylvania 12,787,209

Utah 2,942,902 Tennessee 6,549,352

Washington 7,061,530 Texas 26,956,958

Utah 2,942,902

Virginia 8,326,289

Total 1,419,561 Total 126,879,599 Total 194,568,717

Percent of U.S.

Population .04% Percent of U.S.

Population 39.8% Percent of U.S.

Population 61.0%

Source: U.S. Census and OAG schedules

In Surrebuttal to Exhibits HA-App2015-3

Hawaiian Delta American

DOT Docket OST-2010-0018

Exhibit AA-SR-103

Page 1 of 1
6

#LetAAFlyHaneda

Contrary to Hawaiian’s Assertion About the Growth of the

Hawaii-Tokyo Market, That Market Is Smaller Today Than It Was 14 Years Ago

In Surrebuttal to Exhibit HA-2015A-Series 400

Hawaii-Tokyo Market

(Years Ending June)

Year Onboards

2001 1,010,337

2014 1,003,762

There has been no growth in the Hawaii-Tokyo market in 14 years

Source: U.S. DOT T-100 

1,000

1,002

1,004

1,006

1,008

1,010

1,012

2001 2014

Thousands

Onboards

Onboards

DOT Docket OST-2010-0018

Exhibit AA-SR-104

Page 1 of 1
7

#LetAAFlyHaneda

Talk About a True “Domination” – It’s Not Alliances but

Hawaiian’s Virtual Monopoly on Inter-Island Hawaii Service

Hawaiian

84.8%

Mokulele, 

Island Air, 

Mesa

15.2%

Hawaiian

89.3%

Mokulele, 

Island Air, 

Mesa

10.7%

Seats - 2014 ASMs - 2014

Note: Hawaiian share includes Empire Airlines which operates O’hana for Hawaiian

Source: OAG CY 2014

In Surrebuttal to HA-2015A-Series 700

DOT Docket OST-2010-0018

Exhibit AA-SR-105

Page 1 of 1
8

#LetAAFlyHaneda

LAX’s Increase in Passengers in 2013 Was 86% Larger

than Seattle’s – Nearly 1.4 Million More Growth Passengers

In Surrebuttal to Exhibit SEA-106, Port of Seattle Consolidated Answer

Passengers

2013

Passengers 

2012

Percentage 

Change

Passengers 

Change

Seattle 34,826,741 33,223,111 +4.8 +1.6 million

Los Angeles 66,667,619 63,688,121 +4.7 +3.0 million

Source: ACI 2013 North American Airport Traffic Summary (Passengers)

DOT Docket OST-2010-0018

Exhibit AA-SR-106

Page 1 of 1
9

#LetAAFlyHaneda

Americans Proposed Los Angeles-Haneda Service Covers More States

and Communities Than Does Delta’s Seattle-Haneda Service

Source: OAG, Airline Schedules and Exhibit AA-107.

In Surrebuttal to Exhibits DL-A-202 and DL-A-203

American’s LAX-HND Service 

Summer

15 States

23 U.S. Communities

(plus 2 Canadian 

markets)

Delta’s SEA-HND Service 

Summer

14 States

22 U.S. Communities

(plus 2 Canadian 

markets)

American’s LAX-HND Service 

Winter

16 States

30 U.S. 

Communities

(plus 1 Canadian 

and 

1 Brazilian market)

Delta’s SEA-HND Service 

Winter

10 States

14 U.S. 

Communities

(plus 1 Canadian 

market)

DOT Docket OST-2010-0018

Exhibit AA-SR-107

Page 1 of 1

CERTIFICATE OF SERVICE

I, Abigail Donovan, certify that, on January 20, 2015, I caused to be served a copy of the 

foregoing Reply of American Airlines, Inc. to the Answers of Delta Air Lines, Inc. and Hawaiian 

Airlines, Inc. by email upon those addressees listed below:

paul.gretch@dot.gov (DOT)

brian.hedberg@dot.gov (DOT)

brett.kruger@dot.gov (DOT)

todd.homan@dot.gov (DOT)

peter.irvine@dot.gov (DOT)

EngleTS@state.gov (Dep’t of State)

cristinasa@state.gov (Dep’t. of State)

eugene.alford@ita.doc.gov (Dep’t. of Commerce)

ejames@jamhoff.com (Allied Pilots Association)

seth.waxman@wilmerhale.com (Delta)

sascha.vanderbellen@delta.com (Delta)

chris.walker@delta.com (Delta)

Mike.Donatelli@alpa.org (Delta MEC/ALPA)

john.allen@faa.gov (FAA)

jhill@cooley.com (Hawaiian)

Perkmann@cooley.com (Hawaiian)

Robert.Lamansky@hawaiianair.com (Hawaiian)

glindsey@lawa.org (Los Angeles World Airports)

ishiwata.k@portseattle.org (Port of Seattle)

safora.i@portseattle.org (Port of Seattle)

dan.weiss@united.com (United)

steve.morrissey@united.com (United)

gmurphy@crowell.com (United)

sseiden@crowell.com (United)

info@airlineinfo.com (AirlineInfo.com)

_________________________________

Abigail Donovan