New Route Opportunities (U.S.-China)

Order 04-10-08
OST-04-18468 - 2004 Cargo Designation and 2004/2005 All-Cargo Frequencies

Issued October 13, 2004 | Served October 18, 2004

Final Order

We have decided to make final our tentative decision in Order 2004-9-4. Specifically, we are awarding Polar certificate authority to operate in the U.S.-China market, and we are allocating it nine weekly frequencies (six in 2004 and three additional in March 2005). We also are allocating FedEx and UPS twelve weekly frequencies each (six in 2004 and six in March 2005) and Northwest six weekly frequencies (three in 2004 and three in March 2005) for services in the U.S.-China market.

In reaching our tentative decision to select Polar for the new U.S.-China all-cargo designation, we said our new agreement with China offers us the opportunity to enhance competition significantly in the U.S.-China air cargo market. We tentatively believed that Polar would provide the greatest public benefits in this case because Polar is in the best position to compete with well-established incumbents in the market, and because it would provide significant service benefits. We said that Polar had an advantage stemming from the facts that it is the only new carrier applicant with extensive operations and resources in the region (including a hub), the only applicant with demonstrated broad experience in scheduled cargo services in the transpacific and intra-Asia markets, and the only applicant that demonstrated it has a road feeder service in the U.S. to provide shippers access to multiple interior points in the U.S. In short, we said that in the circumstances presented, Polar was the applicant that best demonstrated it has the resources to provide vigorous competition to the strong competitors already in the market. None of the new designation applicants has presented evidence that would persuade us to alter our tentative findings in favor of Polar.

By: Karan Bhatia