Despite the financial trials of several of its members, the world of the airlines remains aflutter with other news. On Tuesday, for instance, the U.S. Department of Transportation tentatively awarded United Airlines (NASDAQ:UAUA) the right to initiate a daily route from the Washington, D.C., area's Dulles International Airport to China's Peking Capital Airport in Beijing.

In winning the tentative award, United beat out rivals Continental Airlines (NYSE:CAL), Northwest, and American Airlines (NYSE:AMR), all of whom had submitted applications for the China route. Continental's application called for flights between Newark and Shanghai, while Northwest would have flown between Detroit and Shanghai, and American had opted for routes between Dallas-Fort Worth and Beijing. On Tuesday, the DOT denied an American Airlines request to alter its application to include a stop in Chicago before continuing on to Beijing.

United intends to begin the daily service within 90 days, although the Department of Transportation will accept objections to the award for 14 days. The company plans to cover the route with Boeing (NYSE:BA) three-class 747-400 aircraft.

Down the road in Atlanta, on Wednesday, Delta received a sweetened buyout offer from US Airways (NYSE:LCC). The new offer is for $10.2 billion, up from the $8.5 billion offer tendered on Nov. 15. But the sweetened offer carries specific stipulations that, if not met, will cause it to be rescinded on Feb. 1:

  • The Delta creditors must support the start of the due-diligence process, which would open Delta's books to US Air.

  • Delta's Feb. 7 bankruptcy hearing involving its reorganization plan must be postponed.

  • The creditors committee must support the companies filing paperwork with the Justice Department, thereby starting the regulatory process.

For its part, Delta responded, "On its face, the revised proposal does not address significant concerns that have been raised about the initial US Airways proposal and, in fact, would increase the debt burden of the combined company by yet another $1 billion."

The new offer includes 89.5 billion US Airways shares and $5 billion in cash, versus 78.5 billion shares and $4 billion in cash.

So how should Fools look at the airlines? Is it time to buy, sell, or waffle? Without attempting to wing it with a blanket response that fits all of the carriers, I'd advise those positing this question to examine American, United, Southwest (NYSE:LUV), and US Airways carefully for possible representation in the group. But while I'd gladly fly with Delta or Northwest, I'd leave their shares at the gate.

Finally, I urge Fools who initiate or add to airline positions to keep a close eye on crude-oil prices. Those prices recently have been moving in a direction favorable to the carriers, but I would advise being on the lookout for any sort of meaningful upward movement in crude, which frequently trades inversely to the airlines.

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Fool contributor David Lee Smith does not own shares in any of the companies mentioned. He will fly JetBlue for the first time this weekend, and he welcomes your questions and comments.