New Pacific Rim airlines fill up empty airport gates.

Asian airlines fly into L.A. as failed U.S. carriers depart

While bankrupt and out-of-business U.S. airlines have left gate space empty at Los Angeles International Airport, four Asian airlines, offering service to destinations like Seoul, Hong Kong and Bangkok, have set up shop there.

Passenger counts at LAX declined 0.3 percent between 1990 and 1991, noted Diane Reesman, airport spokeswoman. Domestic travel was down by 1.9 percent but international travel was up by 5.5 percent, despite the Persian Gulf War, Reesman said.

Because of the departures of Pan Am and Midway, there are vacant gates at LAX, said LAX Manager Stephen Yee. "We really haven't had any new (domestic) airlines come into the airport. The only new airlines we've had are the foreign carriers," he said.

In fact, the only reason there was not a more significant decline in travel is because of the increase in international travel, said Yee. Los Angeles to Asia routes are the fastest growth area at the airport, he said.

The four new airlines, Korea-based Asiana Airlines, Thailand-based Thai Airways, Hong Kong-based Cathay Pacific and China-based China Eastern, are serving the growing L.A.-to-Asia business travel market, as well as Los Angeles' growing Asian population, airline officials said.

Another, EVA Airways, owned by giant shipping company Evergreen Marine Corp., will begin flying passengers and cargo from Los Angeles to Taipei, Taiwan, in November.

Since August 1991, China Eastern Airlines, owned by the Chinese government, has been operating service from Los Angeles to Shanghai twice a week, said F.K. Zhang, general manager of the airline. Load factors on the 340-seat MD-11 aircraft have been "not too bad," around 50 percent in the winter, down from 80 percent when service started last year, Zhang said.

Government-owned Thai Airways International Ltd. began flying MD-11s from Los Angeles to Bangkok via Seoul in April 1991, said Claus Jensen, director of marketing for the airline. Thai Airways plans to step up service with six flights from Los Angeles to Bangkok in April, Jensen said.

"We think that Los Angeles has a lot of potential with our direct service to Bangkok. We're pleased with the load factors so far," said Jensen, referring to the percentage of seats occupied by paying passengers for all miles flown.

"A lot of the traffic (from Los Angeles) is Thai nationals. There's a lot of family traffic and students," he said.

Asiana Airlines, a privately owned company, has been running with a load factor of about 75 percent since it began service from LAX to Seoul on Nov. 15, said Steve Alexis, sales manager for the airline. A load factor of 50 percent is considered good for a new route, he added.

The airline, which is only three years old, has a fleet of 16 aircraft, but has a firm order for 40 more planes, Alexis said. He noted that Los Angeles has the largest Korean community outside of Korea.

Asiana's jets carry about 37 tons of cargo on each flight and cargo rates range from $750 to $2,000 a ton, depending on the type of cargo, Alexis said. "There is a lot of cargo moving in both directions, electronics, food, medicine," he said.

Cathay Pacific began service from Los Angeles to Hong Kong in July 1991, said Jay Olver, vice president of USA and Latin America operations for the airline, owned by John Swire Pacific Co. and the Chinese government.

The service was made possible by the new Boeing 747-400, which can make the 16-hour flight without stopping. Cathay Pacific wanted to get into the Los Angeles market years ago, but the airline couldn't get permission to land at a stopover point between Hong Kong and Los Angeles.

And Taipei-based Evergreen Marine Corp., one of the largest shipping companies in the world, intends to wade into the Los Angeles to Asia market this year with a daily Los Angeles to Taipei flight scheduled to begin in November, said Robert Kleist, U.S. corporate adviser to the company.

EVA Airways began service among Asian cities in July 1991 and is waiting for delivery of 747-400s from Boeing before beginning its flight service to Los Angeles, Kleist said. Eventually the airline will establish routes between Taipei and San Francisco, Seattle and New York, he said.

Kleist said even with four other Asian airlines in Los Angeles, there is still room for EVA because of the rapidly growing economies of Southeast Asian countries. "Obviously if we didn't think there was a market, Evergreen's chairman wouldn't have started an airline," he said.

Tom Heijman, airline industry analyst for accounting firm Coopers & Lybrand, said long-distance international flights typically carry cargo while domestic flights rarely do, because there is no time to unload between flights.

"If you don't carry cargo, you're losing a great potential for revenue," Heijman said. "Those revenues are very important. It's hard to make a case (to purchase) a 747-400 and not carry any cargo," he said.