Please ensure Javascript is enabled for purposes of website accessibility

U.S. Pulls Back on Threatened China Airline Ban

By Lou Whiteman – Jun 5, 2020 at 1:55PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Delta and United are seeking to restore limited trans-Pacific service to China.

The United States on Friday reversed course on a potential Chinese airline ban after Beijing said it would begin to ease COVID-19 restrictions that have prevented foreign carriers from restoring service to China.

U.S. airlines have reduced their schedules due to the pandemic, including cutting flights to China, but as the worst of the pandemic appears to fade, they are taking small steps to rebuild their international networks. Both Delta Air Lines (DAL -1.34%) and United Airlines Holdings (UAL -1.16%) have announced plans to resume limited service to China, pending government approval.

A United Airlines plane exiting a hanger

Image source: United Airlines.

China, however, has been dragging its feet on allowing foreign airlines to resume service. As a response, the Department of Transportation earlier this week moved to block Chinese airlines from flying into the U.S.

China then said it would allow a limited number of foreign flights. The DOT then said it will still place restrictions on Chinese carriers, limiting the weekly round trips the airlines can fly as long as Chinese restrictions remain in place. The U.S. is "fully prepared to once again revisit the action" should Chinese policy change, the department said. 

Airlines are rebuilding their schedules, but for now are focused primarily on domestic travel. Issues with China for now are likely to have only a small impact on overall revenue. But prior to the pandemic, Asia was viewed as a key region for growth and the airlines will be watching carefully to see how the U.S. relationship with China evolves in the months to come.

Lou Whiteman owns shares of Delta Air Lines. The Motley Fool recommends Delta Air Lines. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

United Airlines Holdings, Inc. Stock Quote
United Airlines Holdings, Inc.
UAL
$32.53 (-1.16%) $0.38
Delta Air Lines, Inc. Stock Quote
Delta Air Lines, Inc.
DAL
$28.06 (-1.34%) $0.38

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
104%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.