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 :

--------------------------------------------------------------- ANSWER OF UNITED AIRLINES , IN C. 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 10 th 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 11 th 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 9 , 2013BEFORE THE DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

--------------------------------------------------------------- Application s 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 :

--------------------------------------------------------------- ANSWER OF UNITED AIRLINES, IN C.
I. INTRODUCTION United 1 proposes to provide first ever U.S. carrier Tokyo Haneda service at its San Francisco hub gateway

– serving one of the largest U.S.

- Tokyo gateways without nonstop U.S. carrier access to Haneda . Meanwhile, Hawaiian proposes to serve a small gateway that would offer comparatively far less benefits to U.S. consumers and virtually no connecting opportunities for communities served behind Kona . United is the only applicant in this proceeding that has not been given the opportunity to serve Tokyo Haneda to the benefit of its customers, co

- workers and communities and is thus the only applicant that can bring new competition to Tokyo Haneda. Selecting United over Tokyo Haneda incumbent Hawaiian will both maximize public benefits and create new U.S. carrier competition b etween the Western U.S. and Tokyo Haneda. To maximize the public benefits to the traveling and shipping public available through the use of these valuable Tokyo Haneda slots while at the same time enhancing the overall competitive environment between the U.S. and Japan, the Department should selec t United’s proposal to operate daily San Francisco

- Tokyo Haneda flights because:

1 Common names are used for airlines.Answer of United

Page 2

• United’s proposal will provide first time nonstop U.S. carrier competition

between the West Coast and Tokyo Haneda.

• In addition to providing enhanced convenience for nons top passengers in one of the largest U.S.

- Tokyo markets, United will provide convenient connecting service with a catchment area covering key markets across the entire U.S. mainland

.

• Only United’s proposal will introduce new and/or competitive U.S. carr ier service and a large hub network for Tokyo Haneda passen gers throughout the Western U.S

. , including smaller communities

.

• 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, co

- workers and communities , and awarding the available slots to United will correct this imbalance ; whereas Hawaiian already serves Tokyo Haneda.

• United continues to grow its Asia/Pacific operations at San Francisco and its San Francisco hub is the largest airline operation on the W est C oast, thus making San Francisco an ideal gateway ; whereas other U.S. gateways have been tried and failed in serving Tokyo Haneda

. Hawaiian already has access to Tokyo Haneda

– and its Kona

- Haneda proposal sho uld
not be selected over United’s proposal to offer San Francisco

- Haneda service. Hawaiian’s proposal to serve the much smaller Kona

- Tokyo market is inferior to United’s proposal for San Francisco

- Tokyo because it would : offer comparatively far few er benefits to U.S. consumers ; not increase competition between U.S. carriers at Tokyo Haneda; and not offer meaningful beyond gateway competition to multiple U.S.

- Tokyo markets or smaller communities

. United answers the application of Hawaiian as follows an d urges the Department to grant its application to provide San Francisco

- Tokyo Haneda service.
II. UNITED’S PROPOSAL OFFERS FAR MORE PUBLIC BENEFITS THAN DOES HAWAIIAN’S PROPOSAL United’s proposal to provide nonstop San Francisco

- Tokyo Haneda service offe rs far more public benefits than does Hawaiian’s proposal , and Department precedent compels the award of the available Tokyo Haneda slots to United. The Department should select the largest
U.S.

- Tokyo market available in this proceeding to maximize the nu mber of passengers who willAnswer of United

Page 3 benefit from the introduction of nonstop Tokyo Haneda service at the gateway supporting the largest traffic volume to meet its “principal objective” in allocating slots to “maximize public benefits...that will likely result in s ervice that best meets the needs of the traveling and shipping public.” Order 2013

- 11

- 9 at 3; see also Order s 2012

- 8

- 20 at 3 and 2010

- 1

- 17 at 1

- 2 . To make this determination, the Department must consider the relative merits of each proposal, 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 to each gateway

. 2 The combination of a large gateway with plentiful online connections has enabled United to institute and sustain U.S.

- Asia services. Exhibits UA

- A

- 1 04 to A

- 1 06 . Appropriate emphasis on these two factors will also ensure the success of the selected Tokyo Haneda service.
U nited proposes to serve a large nonstop market that lacks U.S. carrier service, and properly timed Tokyo Haneda flights from United’s San Francisco hub would provide competitive new entrant service to approximately 1.8 million Americans

– reaching a catchm ent area far larger than what would be offered by Hawaiian’ proposal. Exhibits UA

- A

- 101 and UA

- A

- 107 . United at San Francisco will also provide far more roundtrip connections than Hawaiian can provide at Kona. Exhibit UA

- A

- 101

. United’s San Francisco hub is the largest hub on the West Coast and the only hub at which Tokyo Haneda service is being proposed in this proceeding. Exhibit UA

- A

- 106

. San
F rancisco is also one of the largest U.S.

- Tokyo gateway s without nonstop U.S. carrier access to Haneda, and United is 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, co

- workers and communities

. Exhibit UA

- A

- 10 9 . Awarding t he available Tokyo Haneda slots to United will correct this

2 Indeed, the “ability to flow traffic over the primary route to and from points behind the U.S. gateway...figured significantly in carrier selection because it bears on both the economic viability of a carrier’s proposal and the benefits it might bring to passengers outside of the primary market.” 51 Fed. Reg. 43180 , 43187 (Dec. 1, 1986) (establishing procedures and criteria for selecting carriers for limited entry markets).Answer of United

Page 4 imbalance and create first time nonstop U.S. carrier competition between the Western U .S. and Tokyo Haneda

. In addition, United’s hub at San Francisco will offer convenient online connecting serv ice for passengers traveling between points throughout North America and Tokyo Haneda

– including the four largest U.S. cities

. See Exhibit UA

- A

- 102

. 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

- Haneda market...[and] a n extensive number of online connections through its San Francisco hub to an appreciable catchment area.” See Order 2012

- 11

- 12 at 6.
III. UNITED’S PROPOSAL SHOULD BE SELECTED OVER HAWAIIAN’S PROPOSAL Hawaiian’s proposal would use these valuable Haneda slots to serve the small Kona

Tokyo market and offer comparatively far few er benefits to U.S. consumers than would United’s San Francisco

- Tokyo Haneda proposal

. T he San Franci sco - Tokyo market is four times larger than the Kona

- Tokyo market and United’s proposed service would reach 29 times more

consumers tha n Hawaiian at Kona . Exhibits UA

- A

- 100 and UA

- A

- 101. Putting aside that Hawaiian is seeking a second pair of U.S.

- Tokyo Haneda slots while United has still not been given the opportunity to operate at Tokyo Haneda (Exhibit UA

- A

- 109), Hawaiian has yet to provide any Asia/Pacific service from its proposed Kona gateway. Exhibit UA

- A

- 105. Hawaiian’s proposed service at Kona would also offer no connections to the U.S. mainland whatsoever, offering only its Neighbor Hawaiian Island connecting service. See , e.g., Hawaiian Application at 3 . This stands in stark c ontrast to the comprehensive network benefits offered by United at San Francisco

– where United will offer first time U.S. carrier connecting service and/or competitive connecting service between Tokyo Haneda and 17 smaller communities in the Western U.S

. Exhibit UA

- A

- 104

. Selecting United ’s San Francisco

- Tokyo Haneda proposal will provide additional capacity for the large business communities and shippers in San Francisco and Tokyo, the large