BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

---------------------------------------------------------------

Applications of :

:

HAWAIIAN AIRLINES, INC. :

and : Docket DOT-OST-2010-0018

UNITED AIRLINES, INC. :

:

in the matter of 2010 U.S.-Haneda :

Combination Service Allocation Proceeding :

---------------------------------------------------------------

REPLY OF

UNITED AIRLINES, INC.

Communications with respect to this document should be sent to:

Hershel I. Kamen

Senior Vice President–Alliances,

Regulatory and Policy

Daniel A. Weiss

Managing Director–International

Affairs and Regulatory

UNITED AIRLINES, INC.

233 South Wacker Drive

10th Floor – HDQIZ

Chicago, IL 60606

(872) 825-6828

hershel.kamen@united.com

dan.weiss@united.com

Steve Morrissey

Managing Director–Regulatory Affairs

and Policy

Karine R. Faden

Managing Counsel–Regulatory, Antitrust &

Competition

UNITED AIRLINES, INC.

1225 New York Avenue, NW

Suite 1100 – DCAIZ/DCALD

Washington, DC 20005

(202) 521-4373

(202) 521-4363

steve.morrissey@united.com

karine.faden@united.com

Thomas Newton Bolling

Vice President and Deputy General Counsel

UNITED AIRLINES, INC.

233 South Wacker Drive

11th Floor – HDQLD

Chicago, IL 60606

(872) 825-8068

thomas.bolling@united.com

Douglas P. Kelley

Senior Counsel–Regulatory, Antitrust &

Competition

UNITED AIRLINES, INC.

1600 Smith Street

HQSLG-15

Houston, TX 77002

(713) 324-5156

doug.kelley@united.com

Lorraine B. Halloway

Gerald F. Murphy

CROWELL & MORING LLP

1001 Pennsylvania Avenue, NW

Washington, DC 20004

(202) 624-2500

lhalloway@crowell.com

gmurphy@crowell.com

Counsel for

United Airlines, Inc.

December 16, 2013
BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

---------------------------------------------------------------

Applications of :

:

HAWAIIAN AIRLINES, INC. :

and : Docket DOT-OST-2010-0018

UNITED AIRLINES, INC. :

:

in the matter of 2010 U.S.-Haneda :

Combination Service Allocation Proceeding :

---------------------------------------------------------------

REPLY OF

UNITED AIRLINES, INC.

I. INTRODUCTION

Hawaiian’s1 Answer underscores why United’s Application to provide competitive and

first ever U.S. carrier service in the large San Francisco-Tokyo market between United’s San

Francisco hub gateway and Tokyo Haneda should be selected under the Department’s public

interest standards – which are based on providing the most benefits to the greatest number of

consumers. While Hawaiian’s proposal to serve the small Kona gateway may have its attributes,

it pales in comparison to the plentiful connecting opportunities, extensive catchment area,

economic benefits and new entrant competition that are among the hallmarks of United at San

Francisco. And there is only one Tokyo Haneda slot pair available in this proceeding. Moreover,

public stakeholders who stand to reap the significant consumer benefits that would flow from

United’s proposed San Francisco-Tokyo Haneda service have urged the selection of United’s

proposal. San Francisco International Airport and the United Master Executive Council of the

Air Line Pilots Association, International have submitted pleadings supporting United’s

Application. They are joined by Democratic Leader Nancy Pelosi, Members of the California

1 Common names are used for airlines.
Reply of United

Page 2

Congressional Delegation, San Francisco Mayor Edwin Lee and other civic and business

partners in recognizing that United’s San Francisco-Tokyo Haneda proposal best meets the needs

of the flying public and their communities. Exhibits UA-R-121 and UA-A-110; see also Docket

DOT-OST-2010-0018.

The Department should select United’s proposal because:

 United’s San Francisco-Tokyo Haneda proposal will provide first time nonstop U.S.

carrier competition between the West Coast and Tokyo Haneda and is supported by

longstanding Department precedent favoring new entrants, like United, over incumbents,

like Hawaiian, in limited entry markets.

 Only United’s proposal will introduce new and/or competitive U.S. carrier service and a

large hub network for Tokyo Haneda passengers throughout the Western U.S., including

smaller communities, in addition to offering plentiful connecting opportunities across the

entire U.S. mainland.

 United’s proposed San Francisco gateway is four times the size of Hawaiian’s proposed

Kona gateway and, unlike the Kona-Tokyo market, the San Francisco-Tokyo market has

shown growth in the short period of time since the last Tokyo Haneda allocation

proceeding.

 United continues to grow its Asia/Pacific operations at San Francisco and its San

Francisco hub is the largest airline operation on the West Coast, thus making San

Francisco an ideal gateway.

Hawaiian’s Kona-Tokyo Haneda service proposal should not be selected over United’s

proposal to provide new entrant San Francisco-Tokyo Haneda service because:

 Hawaiian is an incumbent at Tokyo Haneda already holding one of only four slot pairs

reserved for U.S. carriers, whereas United is the only U.S. carrier serving Japan that has

not been given the opportunity to serve Tokyo Haneda to the benefit of its customers,

coworkers and communities; longstanding DOT policy indicates that Hawaiian’s

proposal should be dismissed in favor of United’s new entrant Application.

 Despite Hawaiian’s best efforts to justify selection of its Kona-Tokyo Haneda proposal

over United at San Francisco, Hawaiian relies principally on:

o the characteristics of the Honolulu-Tokyo market and strangely not the KonaTokyo market that Hawaiian proposes to serve;
Reply of United

Page 3

o the generally poor service records of the other incumbent U.S. carriers at Tokyo

Haneda – which are of no relevance since neither those carriers nor those

gateways are at issue in this proceeding; and

o misrepresentations and unsubstantiated assumptions regarding other carriers’

plans in the San Francisco-Tokyo market.

The Department’s public interest standards compel the selection of the proposal that

would maximize consumer benefits for the greatest number of nonstop U.S.-Tokyo passengers

and their communities. In evaluating which applicant should be authorized to serve which

gateway, the Department should consider the carriers’ ability to flow traffic through their

proposed gateways on their own connecting flights, the size of the local markets to be served and

new competition for U.S. airlines that already offer nonstop service at Tokyo Haneda. Based on

these criteria, United’s proposed San Francisco-Tokyo Haneda service is the clear winner.

United replies to Hawaiian’s Answer as follows and urges the Department to grant its

Application to provide San Francisco-Tokyo Haneda service.

II. HAWAIIAN’S ANSWER DEMONSTRATES WHY UNITED’S SAN FRANCISCOTOKYO HANEDA PROPOSAL SHOULD BE SELECTED OVER HAWAIIAN’S

PROPOSAL

A. By Any Measure, United’s Proposal To Serve The Large San Francisco-Tokyo

Market Offers Far More Public Benefits Than Hawaiian’s Proposed Kona-Tokyo

Haneda Service

The Department’s selection criteria compel an award to United in this proceeding.

Selecting the largest market available to maximize the number of passengers who will benefit

from the introduction of nonstop Tokyo Haneda service at the gateway supporting the largest

traffic volume will meet the Department’s “principal objective” in allocating slots to “maximize

public benefits...that will likely result in service that best meets the needs of the travelling and
Reply of United

Page 4

shipping public.” Order 2013-11-9 at 3; see also Orders 2012-8-20 at 3 and 2010-1-17 at 2.2

Consideration of the relative merits of each of United’s and Hawaiian’s proposals, especially the

number of passengers who would benefit from the connecting networks of the applicants’ U.S.

gateways, in addition to the relative volumes of local Tokyo traffic flowing from each gateway,

weighs heavily in favor of United’s San Francisco-Tokyo Haneda proposal.3

United’s proposed San Francisco-Tokyo Haneda service will enhance the competitive

environment between the West Coast and Japan by adding a new U.S. carrier at Tokyo Haneda

and make daily nonstop U.S. carrier service available in each of the two largest West Coast

markets, as well as provide extensive connecting opportunities for Tokyo Haneda passengers.

United at San Francisco will provide competitive new entrant service to approximately 1.7

million Americans – 1.5 million of which are beyond San Francisco. Exhibits UA-R-104 and R108. By contrast, Hawaiian’s negligible catchment area at Kona would cover fewer than 60,000

consumers and its proposed service would offer no connections to the U.S. mainland whatsoever.

Exhibit UA-R-108; see also Hawaiian Application at 3. United at San Francisco will provide

roundtrip, online connections to/from Tokyo Haneda to 16 states and 29 points across the U.S. –

and at least one way, online connections to 22 states and 43 points across the U.S. Exhibits UAR-110 and R-111. United will also offer first time U.S. carrier connecting service and/or

2 A plain reading of each of the Department’s three instituting orders regarding

Tokyo Haneda slots demonstrates that Hawaiian’s claim that the Department has somehow

changed its focus in this proceeding does not withstand scrutiny. See Hawaiian Answer at 22-23.

3

See Final Rule and Policy Statement on Procedures and Criteria for Selecting

Carriers for Limited-Entry Markets, 51 Fed. Reg. 43180, 43187 (Dec. 1, 1986).
Reply of United

Page 5

competitive connecting service between 17 smaller communities in the Western U.S.4Exhibit

UA-R-109. Hawaiian’s only response to the plentiful connecting opportunities offered by

United at San Francisco is a meaningless comparison between Tokyo Haneda-only connecting

traffic (as opposed to the correct metric of all Tokyo connecting traffic) at United’s unique

mainland connecting points and Kona, and to assert that there is no benefit to United providing

connecting service that will compete with Delta at Los Angeles and Seattle.5See Hawaiian

Answer at 45-47.

Hawaiian also erroneously claims that United plans to downgauge to a B-787 aircraft due

to overcapacity in the San Francisco-Tokyo market. See Hawaiian Answer at 11. Rather, United

is planning to use the fuel-efficient, technologically-advanced B-787 aircraft for its proposed San

Francisco-Tokyo Haneda service because it will be the most efficient use of United’s available

fleet resources for this operation and others. The B-787 is also the optimal aircraft choice given

its ability to open up new markets and ensure service viability and consumer benefits over the

long term.6 United contends that Hawaiian’s ‘the biggest aircraft should always win’ argument

4 Despite Hawaiian’s failed attempts to belittle the unique interior connections

United’s proposed San Francisco-Tokyo Haneda service would offer to smaller communities like

Boise, Modesto and Eugene (along with major U.S. cities like Chicago and Houston), these

communities, as evidenced by the celebration of newly-announced United service at Sun Valley,

highly value their connecting service to major hubs like United at San Francisco. See, e.g.,

Celebration Planned for First SFO Flight, IDAHO MOUNTAIN EXPRESS AND GUIDE (Dec. 11,

2013), http://www.mtexpress.com/index2.php?ID=2007149679#.Uqf4qXi9LCR.

5

The Department has recognized the benefits of such competitive connecting

service options in carrier selection proceedings. See, e.g., Order 2000-7-19 at 5 (prioritizing the

competitive service options for passengers in Delta’s Atlanta catchment area for connecting

service to Colombia over the services offered by American at Miami and Continental at

Houston).

6 United’s proposed San Francisco-Tokyo Haneda flights will also complement its

daily San Francisco-Tokyo Narita service, which will continue to operate and offer alternative

time of day departures and arrivals as well as service for customers who prefer Tokyo Narita or

are making connections there. United’s flight schedules will provide consumers with the

opportunity to optimize Tokyo Haneda and Tokyo Narita (via San Francisco) for their individual

travel needs. UA-R-112 and R-113.
Reply of United

Page 6

is dated thinking. With airlines facing a heated competitive environment and an ever-increasing

need to maximize operational efficiency, the focus has shifted to finding the aircraft that best

balances demand and efficiency to help ensure long term viability of services. The fact that

United has been forthright regarding its fleet plans for San Francisco-Tokyo Haneda service

should be applauded rather than chastised, as Hawaiian attempts cynically to do.7 Moreover, the

Department has recognized that “aircraft size and capacity matter more in some route

proceedings and less in others.” Order 94-7-1 at 9; see also Orders 2006-6-25 at 19 (greater

capacity outweighed by new-entrant competition and market structure benefits) and 1990-4-44 at

7 (“aircraft size should not be considered a major selective criterion in the Honolulu-Tokyo

market” where Delta’s “nonstop service from Honolulu to Pacific Rim countries other than Japan

leaves capacity on its smaller aircraft which would otherwise be filled with passengers traveling

through Japan to these other Pacific Rim destinations”). United’s plans to utilize the most

efficient aircraft for its proposed first ever U.S. carrier San Francisco-Tokyo Haneda service, the

extensive Asia/Pacific services United already provides at its San Francisco hub, and the new

entrant competition it will provide with Delta on the West Coast, all outweigh significantly the

flight Hawaiian proposes to offer at Kona.

7

The veracity of Hawaiian’s aircraft size argument is questionable given its

President & CEO’s public statements on the subject: “One of the things that’s really important to

[Hawaiian] is to find not only an airframe, but also an engine which is economic from a

maintenance perspective as well as fuel burn perspective.” Vinay Bhaskara, Interview:

Hawaiian Airlines Chief Executive Mark Dunkerley, ASPIRE AVIATION (Sep. 13, 2012),

http://www.aspireaviation.com/2012/09/13/interview-hawaiian-airlines-chief-executive-markdunkerley/. Hawaiian’s related questioning as to United’s desire to succeed at Tokyo Haneda is

also entirely without foundation. See Hawaiian Answer at 47.
Reply of United

Page 7

B. Hawaiian’s Kona-Tokyo Haneda Proposal Cannot Stand On Its Own, And Most

Of The Information Provided In Hawaiian’s Answer Is Irrelevant In This

Proceeding

Hawaiian’s Kona-Tokyo Haneda proposal cannot stand on its own and does not merit

selection over United’s comprehensive hub gateway at San Francisco. Hawaiian’s Answer goes

to great lengths to conflate Kona with the State of Hawaii as a whole and Honolulu, in particular.

Hawaiian also attempts to ascribe to United problems that other incumbent U.S. carriers may

have experienced with their Tokyo Haneda services. All told, Hawaiian devotes approximately

90 pages to discussing the Hawaii-Tokyo market, Hawaiian’s incumbent Honolulu-Tokyo

Haneda service, and the service records of other U.S. carriers’ U.S.-Mainland-Tokyo Haneda

gateways.

The small Kona-Tokyo market does not reasonably compare to the San Francisco-Tokyo

market. Kona comprises only 4% of all Hawaii-Tokyo passengers. Exhibit UA-R-100. And this

figure represents a nearly 3% decrease in Kona’s share of total Hawaii-Tokyo traffic since last

year’s proceeding. Exhibit UA-R-101. By contrast, San Francisco is an international business

center that accounts for 33% of all California-Tokyo traffic. Exhibit UA-R-102. The size of the

Kona-Tokyo market has also decreased by 34% during that same time period (Exhibit UA-R103), while the San Francisco-Tokyo market is up 7%. Exhibit UA-R-104. United at San

Francisco will also reach 1.7 million consumers – 29 times more than Hawaiian at Kona. Exhibit

UA-R-108. In terms of potential economic benefits, San Francisco is home to 31 of the 54

Fortune 500 companies located in California, California has overall annual exports of $161

billion and $13.1 billion to Japan (1,617 times and 131 times, respectively, more than Hawaii),

Japanese imports comprise nearly 25% of California’s $376 billion in annual imports, and there

are 110,000 Japanese companies operating in the state. Exhibits UA-R-114 to R-116; R-118;
Reply of United

Page 8

and R-120. Moreover, more than 561,000 Japanese visitors spend an estimated $1.1 billion in

California each year. Exhibits UA-R-117 and R-119.

Hawaiian’s success in the large Honolulu-Tokyo market is certainly commendable, but

Kona is not Honolulu no matter how hard Hawaiian tries to make it so. Nor is United’s success

at San Francisco predetermined by American and Delta’s record at Tokyo Haneda, as Hawaiian

would lead the Department to believe.

In addition, Hawaiian, and any other U.S. or Japanese carrier, is free to provide KonaTokyo Narita service at any time under the U.S.-Japan Open Skies Agreement and they have

chosen not to do so. Despite Hawaiian’s rather optimistic claims of market potential (see, e.g,

Hawaiian Answer at 26-27), Kona has failed at maintaining nonstop Tokyo service. Exhibit UAR-105. Indeed, Hawaiian provides nonstop service between Honolulu and Fukuoka, Osaka,

Sapporo and Sendai, in addition to Tokyo Haneda, but does not offer Kona-Tokyo Narita service

or service to Tokyo Narita from any gateway. Exhibit UA-R-107. And Hawaiian already

provides online service between Kona and Tokyo Haneda, in any event. Exhibits UA-R-112 and

R-113. Hawaiian’s assertions that it only was able to expand into these other open-entry U.S.-

Japan markets because of its Honolulu-Tokyo Haneda slot award, and that further expansion is

dependent upon Hawaiian securing an award for Honolulu-Tokyo Haneda service in this

proceeding (see, e.g., Hawaiian Answer at 2 and 12), are also without merit.

Hawaiian’s attempts to assign whatever problems other incumbent U.S. carriers at Tokyo

Haneda may have had with their U.S. mainland gateways to United at San Francisco also rings

hollow. See, e.g., Hawaiian Answer at 7-10 and 39. It is also particularly unclear how the

factors that caused American (operating a gateway on the totally opposite side of the U.S.

mainland) and Delta (operating a Midwest gateway also four time zones removed from the West

Coast) to suspend Tokyo Haneda service would be applicable to United at San Francisco. See
Reply of United

Page 9

id., at 2 and 8. And despite Hawaiian’s attempts to insinuate otherwise, no U.S. carrier operating

West Coast-Tokyo Haneda service has significantly altered its plans since startup. But unlike

these other carriers – or Hawaiian for that matter – United remains the only U.S. carrier serving

Japan that has not been given the opportunity to operate at Tokyo Haneda to the benefit of its

customers, coworkers and communities. Awarding the available Tokyo Haneda slots to United

will correct this imbalance and create the first ever nonstop U.S. carrier competition between the

Western U.S. and Tokyo Haneda. Hawaiian similarly makes wholly unsubstantiated

assumptions regarding the sustainability of other carriers’ existing San Francisco-Tokyo Narita

service8or decisions to offer Tokyo Narita service from San Jose – a nearby, but perfectly viable

market in its own right – in an awkward attempt to challenge the strength of United’s proposal.

See Hawaiian Answer at 38 and 40. In short, Hawaiian’s arguments regarding the viability of

United’s proposed San Francisco-Tokyo Haneda service are thus speculative and self-serving, at

best, and should be rejected out of hand.9

Hawaiian’s arguments regarding Japanese carriers and competition in West Coast-Tokyo

markets are equally flawed. By asserting that an award to United would somehow put these

valuable Tokyo Haneda slots back in the hands of Japanese carriers and, further, that “an award

to Hawaiian would be an important step toward protecting U.S. operating rights” (Hawaiian

8 Hawaiian goes so far as to presuppose – without foundation – that United’s

proposed San Francisco-Tokyo Haneda service would drive JAL out of the San Francisco-Tokyo

market entirely. See Hawaiian Answer at 35, n. 8. Such speculation is not only irresponsible but

also a transparent attempt to distract from the flaws of Hawaiian’s Kona-Tokyo Haneda

proposal.

9

The factors that led the Department to select United’s proposed service from its

Los Angeles hub to San Jose del Cabo are equally applicable to United at San Francisco and the

viability of its Tokyo Haneda service proposal: “United’s strong presence at Los Angeles (a large

United hub), and its well-developed domestic network system, should help it challenge both the

U.S. and foreign-flag incumbents on the route and sustain the service over time” and “United’s

connecting benefits could increase the likelihood of a viable operation, thereby promoting

sustained competition.” Order 2008-4-20 at 6.
Reply of United

Page 10

Answer at 36 and Exhibits HA-2013A-705 and 2013A-706), Hawaiian fundamentally

mischaracterizes the current Tokyo Haneda slot regime. As Hawaiian well knows, regardless of

how many Tokyo Haneda slots they may hold, Japanese carriers can only operate two slot pairs

each for service to the U.S. (see U.S.-Japan Memorandum of Understanding of October 25,

2010, Annex, Sec. 3), and selecting Hawaiian’s proposal to operate in the small Kona-Tokyo

market would mean that United would remain the only U.S. carrier serving Japan that has not

been given the opportunity to operate at Tokyo Haneda to the benefit of its customers, coworkers

and communities.10 Hawaiian further attempts to distract from this point by comparing the size

and scope of its overall network to that of United. See, e.g., Hawaiian Answer at 32. But all that

matters here in terms of size is the fact that Hawaiian is 100 times larger than United at Tokyo

Haneda. Exhibit UA-R-106. Moreover, the Department has a longstanding policy of favoring

new entrant competition – like United’s San Francisco-Tokyo Haneda proposal – in carrier

selection proceedings. See, e.g., Orders 2008-5-27 at 13 (selecting “JetBlue [because it] would

offer important new-entrant benefits, not only at Cancun, but also in the U.S.-Mexico market

overall, including superior market structure benefits and connecting service advantages”); 2005-

10-2 at 4 (citing the “need for new entry [with respect to U.S.-Argentina service] because of the

severe restrictions on U.S. carrier service in the market, the dominant positions of the

incumbents in the market, and because new entry offered the greatest prospect for improving

service and competition in the market”); and 1996-4-23 (“Delta’s incumbency was relevant

largely to the extent that it prevented it from offering the high level of inter-gateway competition

and competition with foreign airlines that would result from the selection of [new entrant

Philadelphia-Rome service from] USAir”).

10 The Department previously chose to allocate one daily pair of Tokyo Haneda slots

to American, which, like United, has an immunized Japanese alliance partner (see Order 2010-7-

2), and Hawaiian fails to explain why United should not receive equal treatment.
Reply of United

Page 11

III. UNITED’S SAN FRANCISCO-TOKYO HANEDA PROPOSAL BEST MEETS THE

PUBLIC INTEREST CRITERIA FOR SELECTION IN THIS PROCEEDING

For all of the reasons stated in this Reply and in United’s Application, Supplement and

Answer, the Department should select United’s proposal to serve the large San Francisco-Tokyo

market at its hub at San Francisco International Airport to maximize the public benefits to the

traveling and shipping public available from the allocation of a single pair of Tokyo Haneda

slots. Doing so would squarely satisfy the Department’s “principle objective” in this proceeding

(see Order 2013-11-9 at 3) and correct the persistent competitive imbalance among U.S. carriers

serving Japan by finally giving United the opportunity to operate at Tokyo Haneda to the benefit

of its customers, coworkers and communities. United’s proposed service will provide additional

capacity and greater convenience for the large business communities in both San Francisco and

Tokyo, the large Japanese and Asian populations in the San Francisco region, the large American

community in Tokyo, and travelers throughout United’s San Francisco hub network. United’s

proposed San Francisco-Tokyo Haneda service will also enhance the overall competitive

environment between the U.S. and Japan by adding a new U.S. carrier at Tokyo Haneda, by

introducing new carrier competition for beyond points across the Western U.S. that already have

Delta connecting service via Los Angeles and Seattle, and by making daily nonstop U.S. carrier

Tokyo Haneda service available in the largest West Coast-Tokyo market in which it is not

available currently. Moreover, the Department has already recognized the “notable attributes” of

United “offer[ing] the first U.S. carrier nonstop service using its own aircraft in the sizeable San

Francisco-Tokyo Haneda market...[and] an extensive number of online connections through its

San Francisco hub to an appreciable catchment area.” Order 2012-11-12 at 6.

Docket DOT-OST-2010-0018

Tokyo Haneda

Before The

Department Of Transportation

2010 U.S. – Tokyo Haneda Combination Services Allocation

Proceeding Docket DOT-OST-2010-0018

Nonstop San Francisco – Tokyo Haneda

Reply Exhibits of:
Docket DOT-OST-2010-0018

Tokyo Haneda

Index of Exhibits

Page 1 of 2

United Index Of Reply Exhibits

Exhibit

Number Tokyo - Haneda Service

Number

Of Pages

UA-R-100 Kona – Tokyo Represents Only 4% Of The Hawaii –

Tokyo Market

1

UA-R-101 The Kona – Tokyo Market As A Percentage Of All Hawaii

– Tokyo Traffic Has Decreased Since The Last Route

Proceeding

1

UA-R-102 Kona Represents 4% Of Hawaii’s Tokyo Traffic, Whereas

San Francisco Represents 33% Of California’s Tokyo

Traffic

1

UA-R-103 The Kona – Tokyo Market Size Has Decreased 34%

Since The Last Route Proceeding

1

UA-R-104 The San Francisco – Tokyo Market Size Has Increased

7% Since The Last Route Proceeding

1

UA-R-105 Despite Hawaiian’s Claims Of Market Potential, Kona

Has Failed At Maintaining Nonstop Tokyo Service

1

UA-R-106 Hawaiian, As An Incumbent, Is 100 Times The Size Of

United At Tokyo Haneda Given United Has Not Been

Given The Opportunity To Operate At Haneda

1

UA-R-107 Hawaiian Has The Opportunity To Serve Tokyo Via Narita

Airport But Has Chosen To Not Do So

1

UA-R-108 United’s San Francisco – Tokyo Haneda Proposal Will

Reach 29 Times The Number Of Consumers As

Hawaiian’s Kona – Tokyo Haneda Proposal

1

UA-R-109 United Proposes To Provide First Time U.S. Carrier

Connecting Service And/Or Competitive Connecting

Service Between Tokyo Haneda And Smaller Western

Communities

1

UA-R-110 United’s Flight Schedule Will Provide Roundtrip, Online

Connections To/From Tokyo Haneda (Via San Francisco)

To 16 States And To 29 Points Across The U.S.

2

UA-R-111 United’s Flight Schedule Will Provide At Least Oneway,

Online Connections To/From Tokyo Haneda (Via San

Francisco) To 22 States And To 43 Points Across The

U.S.

2
Docket DOT-OST-2010-0018

Tokyo Haneda

Index of Exhibits

Page 2 of 2

United Index Of Reply Exhibits

Exhibit

Number Tokyo - Haneda Service

Number

Of Pages

UA-R-112 United’s Flight Schedules Will Provide Consumers The

Opportunity To Optimize Tokyo Haneda And Tokyo Narita

(Via San Francisco) For Their Travel Needs

1

UA-R-113 Hawaiian Already Provides Online Service Between Kona

And Tokyo Haneda, Whereas United Has Not Had The

Opportunity To Serve Tokyo Haneda With Its Own

Aircraft And Crews

2

UA-R-114 California State Exports And Imports Total $161.7B And

$376.3B Respectively In 2012

1

UA-R-115 Japan Represents $13.1B In California Exports And

$41.5B In California Imports In 2012

1

UA-R-116 California’s Exports And Exports To Japan Far Surpass

Those Of Hawaii

1

UA-R-117 Japanese Visitors To California Total 561,000 And

Generate An Estimated Spend Of Over $1.1B

2

UA-R-118 More Japanese Companies Employ Workers In California

Than Companies From Any Other Country

1

UA-R-119 Average Japanese Spending In California Totals $1,969

Per Visitor Compared To The Overall Average At $1,883

UA-R-120 There Are 54 Fortune 500 Companies In California, With

31 Companies Residing in the San Francisco Area

2

UA-R-121 Letters Of Support 2

UA-R-122 United Products And Services 4
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-100

Page 1 of 1

Kona - Tokyo Represents Only 4% Of The Hawaii - Tokyo Market

Source: MIDT YE September 2013

Note: Tokyo = Tokyo Haneda + Tokyo Narita

Rebuttal To HA-2013A-303

305

306

Hawaii - Tokyo Market Size 1,475,008

Kona - Tokyo Market Size 59,484

Kona Share Of State Total 4.0%

Hawaii - Tokyo Statistics
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-101

Page 1 of 1

The Kona - Tokyo Market As A Percentage Of All Hawaii - Tokyo Traffic

Has Decreased Since The Last Route Proceeding

Source: MIDT YE September 2013, previous route proceeding Reply Exhibits of United

Note: Tokyo = Tokyo Haneda + Tokyo Narita

Rebuttal To HA-2013A-303

305

306

Kona Share Of Hawaii’s Total Traffic To/From Tokyo

Kona Share Of

State Total Has

Decreased Nearly

Three Percentage

Points
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-102

Page 1 of 1

Rebuttal To HA-2013A-303

305

306

Source: MIDT YE September 2013

Note: Tokyo = Tokyo Haneda + Tokyo Narita

Kona Represents 4% Of Hawaii’s Tokyo Traffic, Whereas San Francisco

Represents 33% Of California’s Tokyo Traffic

Gateway Share Of States’ Total Traffic To/From Tokyo
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-103

Page 1 of 1

Rebuttal To HA-2013A-303

305

306

The Kona –Tokyo Market Size Has Decreased 34% Since The Last Route

Proceeding

Kona – Tokyo Market Size

Source: MIDT YE September 2013, previous route proceeding Reply Exhibits of United

Note: Tokyo = Tokyo Haneda + Tokyo Narita

The Kona - Tokyo

Market Size Has

Decreased 34%
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-104

Page 1 of 1

Rebuttal To HA-2013A-303

305

306

The San Francisco -Tokyo Market Size Has Increased 7% Since The Last

Route Proceeding

San Francisco – Tokyo Market Size

Source: MIDT YE September 2013, previous route proceeding Reply Exhibits of United

Note: Tokyo = Tokyo Haneda + Tokyo Narita

The San

Francisco - Tokyo

Market Size Has

Increased 7%
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-105

Page 1 of 1

Despite Hawaiian’s Claims Of Market Potential, Kona Has Failed At

Maintaining Nonstop Tokyo Service

Source: OAG

Rebuttal To HA-2013A-303

305

306
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-106

Page 1 of 1

Hawaiian, As An Incumbent, Is 100 Times The Size Of United At Tokyo

Haneda Given United Has Not Been Given The Opportunity To Operate

At Haneda

Rebuttal To HA-2013A-113

707

Source: October 2013 OAG

Note: To set the record straight, United notes that Hawaiian (like UA) codeshares on

ANA’s HNL-HND frequency, bringing Hawaiian’s HNL-HND marketing activity to 14

weekly frequencies.

Tokyo Haneda Market Size
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-107

Page 1 of 1

Hawaiian Has The Opportunity To Serve Tokyo Via Narita Airport But

Has Chosen To Not Do So

Rebuttal To HA-2013A-Series 200 Exhibits

Source: October 2013 OAG

Hawaiian’s Japan Operations

Foreign Point Open Entry HA Service

Fukuoka Yes Yes

Osaka Yes Yes

Sapporo Yes Yes

Sendai Yes Yes

Tokyo Haneda No Yes

Tokyo Narita Yes NO
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-108

Page 1 of 1

Rebuttal To HA-2013A-Series 900 Exhibits

Proposal U.S. – Tokyo

Passengers

UA @ San

Francisco

Larger

UA @ San Francisco 1,717,184 29 Times

HA @ Kona 59,484

U.S. – Tokyo Passengers

Source: MIDT YE September 2013, United 2013 Tokyo Haneda application

Note: Tokyo = Tokyo Haneda + Tokyo Narita, United catchment area includes roundtrip

connect points only. Hawaiian’s application was unclear regarding specific beyond Kona

connecting points, if any.

United’s San Francisco - Tokyo Haneda Proposal Will Reach 29 Times

The Number Of Consumers As Hawaiian’s Kona – Tokyo Haneda

Proposal
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-109

Page 1 of 1

Rebuttal To HA-2013A-Series 900 Exhibits

United Proposes To Provide First Time U.S. Carrier Connecting Service

And/Or Competitive Connecting Service Between Tokyo Haneda And

Smaller Western Communities

San Francisco

Eureka

Eugene Boise

Modesto

Reno

Sacramento

United Proposed Connecting Tokyo Haneda Service

Proposed Tokyo Haneda Gateway

Palm Springs

Santa Barbara

Monterey

Redding

Chico

Redmond

Tucson

Fresno

San Luis Obispo

Crescent City

Medford

Source: United 2013 Tokyo Haneda application

Note: Roundtrip and/or one-way connections shown based on summer schedules.
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-110

Page 1 of 2

Rebuttal To HA-2013A-Series 200 Exhibits

San Francisco

Source: United 2013 Tokyo Haneda application

Note: Roundtrip connections shown based on summer schedules.

United’s Flight Schedule Will Provide Roundtrip, Online Connections

To/From Tokyo Haneda (Via San Francisco) To 16 States And To 29

Points Across The U.S.

States With Tokyo Haneda Connecting Service
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-110

Page 2 of 2

Rebuttal To HA-2013A-Series 200 Exhibits

Source: United 2013 Tokyo Haneda application

Note: Roundtrip connections shown based on summer schedules.

Points With Tokyo Haneda Connecting Service

San Francisco

Boise

Boston

Burbank

Chicago

Cleveland

Dallas/Ft. Worth

Denver

Eugene

Eureka

Houston

Las Vegas

Los Angeles

Medford

Modesto Monterrey

New York / JFK

New York / Newark

Ontario

Phoenix

Portland

Redding

Redmond

Reno

Sacramento

Salt Lake City

Santa Barbara

San Diego

Seattle

Washington DC

United’s Flight Schedule Will Provide Roundtrip, Online Connections

To/From Tokyo Haneda (Via San Francisco) To 16 States And To 29

Points Across The U.S.
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-111

Page 1 of 2

Rebuttal To HA-2013A-Series 200 Exhibits

San Francisco

Source: United 2013 Tokyo Haneda application

Note: Based on summer schedules, Alaska not shown.

United’s Flight Schedule Will Provide At Least Oneway, Online

Connections To/From Tokyo Haneda (Via San Francisco) To 22 States

And To 43 Points Across The U.S.

States With Tokyo Haneda Connecting Service
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-111

Page 2 of 2

Rebuttal To HA-2013A-Series 200 Exhibits

Points With Tokyo Haneda Connecting Service

San Francisco

Boise

Boston

Burbank

Chicago

Cleveland

Dallas/Ft. Worth

Denver

Eugene

Eureka

Houston

Las Vegas

Los Angeles

Medford

Monterrey Modesto

New York / JFK

New York / Newark

Ontario

Phoenix

Portland

Redding

Redmond

Reno

Sacramento

Salt Lake City

Santa Barbara

San Diego

Seattle

Washington DC

Source: United 2013 Tokyo Haneda application

Note: Based on summer schedules, Anchorage not shown.

Baltimore Chico

Fresno

Orange County

Palm Springs

Philadelphia

Tuscon

Crescent City

Kansas City

Minneapolis

New Orleans

San Antonio

San Luis Obispo

United’s Flight Schedule Will Provide At Least Oneway, Online

Connections To/From Tokyo Haneda (Via San Francisco) To 22 States

And To 43 Points Across The U.S.
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-112

Page 1 of 1

Rebuttal To HA-2013A-Series 200 Exhibits

Source: United 2013 Tokyo Haneda application

Note: Based on summer schedules.

United’s Flight Schedules Will Provide Consumers The Opportunity To

Optimize Tokyo Haneda And Tokyo Narita (Via San Francisco) For Their

Travel Needs

Flight # Depart Kansas City Arrive San Francisco Equipment Type Frequency Flight # Depart San Francisco Arrive Tokyo Haneda Equipment Type Frequency

5481 16:29 18:17 CR7 1234567 875 19:20 22:10 B777 1234567

Flight # Depart Tokyo Narita Arrive San Francisco Equipment Type Frequency Flight # Depart San Francisco Arrive Kansas City Equipment Type Frequency

838 15:50 9:25 B747-400 1234567 4970 12:25 17:53 CR7 1234567

Kansas City To Tokyo Haneda

Tokyo Narita To Kansas City

Split Service Utilizing Tokyo Haneda And Tokyo Narita

Service Utilizing Tokyo Haneda Only

Flight # Depart Cleveland Arrive San Francisco Equipment Type Frequency Flight # Depart San Francisco Arrive Tokyo Haneda Equipment Type Frequency

1472 12:30 14:55 B737-800 1234567 875 19:20 22:10 B777 1234567

Flight # Depart Tokyo Haneda Arrive San Francisco Equipment Type Frequency Flight # Depart San Francisco Arrive Cleveland Equipment Type Frequency

876 00:05 17:55 B777 1234567 1685 22:40 6:15 B737-800 1234567

Cleveland To Tokyo Haneda

Tokyo Haneda To Cleveland
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-113

Page 1 of 2

Rebuttal To HA-2013A-Entire Application And Answer

Source: Hawaiian website

Hawaiian Already Provides Online Service Between Kona And Tokyo

Haneda, Whereas United Has Not Had The Opportunity To Serve Tokyo

Haneda With Its Own Aircraft And Crews

Flight: HA 147

Duration: 43m

Aircraft: Boeing 717

Depart: 3:06pm

Kailua/Kona (KOA)

Arrive: 3:49pm

Honolulu (HNL)

Layover in HNL: 2h 36m

Flight: HA 457

Duration: 8h 40m

Aircraft: Airbus A332

Depart: 6:25pm

Honolulu (HNL)

Arrive: 10:05pm

Arrives Next Day (+1)

Tokyo (HND)

Kona To Tokyo Haneda
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-113

Page 2 of 2

Rebuttal To HA-2013A-Entire Application And Answer

Source: Hawaiian website

Hawaiian Already Provides Online Service Between Kona And Tokyo

Haneda, Whereas United Has Not Had The Opportunity To Serve Tokyo

Haneda With Its Own Aircraft And Crews

Flight: HA 458

Duration: 7h 25m

Aircraft: Airbus A332

Depart: 11:55pm

Tokyo (HND)

Arrive: 12:20pm

Honolulu (HNL)

Layover in HNL 4h 43m

Flight: HA 388

Duration: 43m

Aircraft: Boeing 717

Depart: 5:03pm

Honolulu (HNL)

Arrive: 5:46pm

Kailua/Kona (KOA)

Tokyo Haneda To Kona
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-114

Page 1 of 1

Rebuttal To HA-2013A-Series 600 Exhibits

California 2012 Exports In Billions

Total: $161.7 Billion

Source: California Data Sheet April 2013

California State Exports And Imports Total $161.7B And $376.3B

Respectively In 2012

California 2012 Imports In Billions

Total: $376.3 Billion
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-115

Page 1 of 1

Rebuttal To HA-2013A-Series 600 Exhibits

Source: California Data Sheet April 2013

Japan Represents $13.1B In California Exports And $41.5B In California

Imports In 2012

Japan Rank Among Asian Countries Regarding

California Exports & Imports

Export Rank: 2nd Import Rank: 2nd

California Trade Statistics In Billions
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-116

Page 1 of 1

Source: California Data Sheet April 2013, U.S. Census Export Data by State

California’s Exports And Exports To Japan Far Surpass Those Of Hawaii

State Export Statistics In Billions

State Export Statistics To Japan In Billions

Rebuttal To HA-2013A-Series 600 Exhibits
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-117

Page 1 of 2

Rebuttal To HA-2013A-Series 600 Exhibits

Source: California Data Sheet April 2013, latest data available

Japanese Visitors To California Total 561,000, And Generated An

Estimated Spend Of Over $1.1B

2011 Japanese Visitors To California
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-117

Page 2 of 2

Rebuttal To HA-2013A-Series 600 Exhibits

Estimated Japanese Visitors Spend In California In Billions

Japanese Visitors To California Total 561,000, And Generated An

Estimated Spend Of Over $1.1B

Source: California Data Sheet April 2013, 2011 statistics shown, assumes a 7.6 average

night stay per trip
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-118

Page 1 of 1

Rebuttal To HA-2013A-Series 600 Exhibits

Source: California Data Sheet April 2013

More Japanese Companies Employ Workers In California Than

Companies From Any Other Country

Number Of Foreign Companies Operating In California
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-119

Page 1 of 1

Rebuttal To HA-2013A-Series 600 Exhibits

Source: California Data Sheet April 2013, 2011 statistics shown, assumes a 7.6 average

night stay per trip

Average Japanese Spending In California Totals $1,969 Per Visitor

Compared To The Overall Average At $1,883

Foreign Traveler Spend In California
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-120

Page 1 of 2

Rebuttal To HA-2013A-Series 600 Exhibits

Source: Fortune Magazine

There Are 54 Fortune 500 Companies In California, With 31 Companies

Residing In The San Francisco Area

Fortune 500 Companies In California
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-120

Page 2 of 2

Rebuttal To HA-2013A-Series 600 Exhibits

Source: Fortune Magazine

There Are 54 Fortune 500 Companies In California, With 31 Companies

Residing In The San Francisco Area

Fortune 500 Companies In San Francisco Area
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-121

Page 1 of 2

Letters Of Support

United provides letters of support for daily, nonstop

service between San Francisco and Tokyo Haneda.

United notes additional letters of support were filed

in United’s answer in this year’s proceeding as well

as in United’s 2012 San Francisco – Tokyo Haneda

application
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-121

Page 2 of 2

Letters Of Support
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-122

Page 1 of 4

United Products And Services

United provides samples of various in-flight

products and services
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-122

Page 2 of 4

United Products And Services

United’s GlobalFirst Cabin
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-122

Page 3 of 4

United Products And Services

United’s BusinessFirst Cabin
Docket DOT-OST-2010-0018

Tokyo Haneda

UA-R-122

Page 4 of 4

United Products And Services

United’s New Economy Cabin