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Richard N. Velotta

Delegation Buoyed by Position on Nonstops

20 June 2005

BEIJING -- While a Nevada tourism delegation in China didn't get everything that it wanted from a meeting with Asian airline executives, it did get a consolation prize from the Chinese government.

Lt. Gov. Lorraine Hunt, who chairs the Nevada Commission on Tourism, arm-twisted representatives of five airlines at a dinner here Friday night and when it was over none of them committed to nonstop flights between China and Las Vegas.

However, a high-ranking official with the General Administration of Civil Aviation of China said he expects the government to approve routes to Las Vegas if an airline chooses to pursue them.

Wang Ronghua, director general of the government agency that is generally regarded as the Chinese counterpart to the U.S. Federal Aviation Administration, said through an interpreter that he expected there would be no problem approving routes to Las Vegas, probably from Beijing or Shanghai.

Hunt said after the meeting that she was happy with the way the meeting went.

"I think it went great," she said. "All of the people here tonight want to make it happen. It's just a matter of getting someone to make a commitment."

Hunt and Bruce Bommarito, executive director of the Nevada Commission on Tourism, hosted a dinner for representatives of Asiana, Northwest, United, China Eastern and Air China airlines -- all carriers that are established in China and with planes capable of making what would be flights of about 14 hours to and from McCarran International Airport.

The dinner, a traditional Chinese affair, was marked with a series of toasts and social exchanges. At one point, the lieutenant governor -- who has been to China on similar trade missions twice before -- was asked by one of the airline executives to sing.

She obliged with an a capella rendition of "Getting to Know You," from the Broadway musical "The King and I."

At one point during the meeting, representatives of the Nevada delegation were on the edge of their seats as one of the airline executives said he had an announcement to make. The announcement turned out to be about Asiana Airlines winning a prestigious award.

Of all the air carriers represented at the meeting, South Korea-based Asiana has shown the highest level of interest in Las Vegas, meeting in both Shanghai and Beijing with the Nevada delegation on this trip and sending a representative to Las Vegas earlier this year.

China Eastern and Air China provide a high level of familiarity for Chinese travelers, while United and Northwest dominate Asian traffic among the American operators.

Meng Yanhua, deputy general manager of China Eastern, said through an interpreter that establishing a route would be easier if there were assurances that another airline wouldn't compete on it. She suggested that Air China could fly from Beijing and her airline from Shanghai.

Dennis C.M. Wong, general sales manager for United's northern China region, said even though United is struggling to remove itself from bankruptcy in the United States, trans-Pacific flights linking Chicago and San Francisco with Beijing have been full in recent months.

Northwest once provided nonstop flights between Las Vegas and Tokyo but abandoned the route when Japan Airlines began flying it.

One executive also said that permission was granted to begin nonstop flights between China and Boston recently and the key to that deal was subsidies guaranteeing that the airline wouldn't lose money on the route for two years.

Las Vegas officials oppose subsidization of routes because it's difficult to turn down others once a precedent has been established.

Sandeep Bahl, general manager in China for Northwest, said part of the problem is that there aren't enough passengers originating in Las Vegas to justify the route.

"You really need to fill the plane both ways," Bahl said.

Many Asian travelers commonly fly to Las Vegas, then add a side trip to California before returning, resulting in lower loads from Las Vegas.

Some fly to California first, then make a side trip to Las Vegas, making it difficult to determine exactly how big the Las Vegas market is.

But Hunt told the executives that Las Vegas is the No. 1 international destination for the Chinese and that Las Vegas and Nevada continue to dominate all U.S. growth statistics.

She also pointed out that there are 700,000 people of Chinese descent in the San Francisco Bay area and 300,000 in the Los Angeles area, many of whom plan family gatherings in Nevada and that three Las Vegas companies -- Wynn Resorts Ltd., Las Vegas Sands Inc. and MGM Mirage -- have stepped up their interest and investment in China with resort projects in Macau.

She also noted that there is a fast-growing Chinatown district in Las Vegas and that the city's reputation as a convention host has grown on the international scale.

Hunt also said that it is becoming easier for Chinese citizens to apply for U.S. visas -- a stumbling block that the Nevada delegation worked to ease in earlier meetings on the current trip.

"I can tell you that from personal experience that it was very difficult to come here the first time I came," Hunt said in the meeting with the airline executives. "This is my third visit and I have become more familiar with things, but it's still hard with all the connections you have to make.

"You can make it easier for everybody with nonstop flights," she said.