Hawaiian, Aloha Tighten Up

Nonstops to neighbor islands hurting interisland carriers

By: Robert Carlsen

New nonstop flights directly from major mainland cities to Hawaii’s neighbor islands, such as United’s just-announced service from Denver to Kona, has prompted Hawaiian and Aloha airlines to look long and hard at its money-losing interisland service.

And even though the carriers have cut the number of interisland flights by 14% and the number of seats by 20% in the past six months, those cuts may not be enough.

The carriers also have asked the U.S. Department of Transportation for an antitrust exemption so airline officials can sit down and work out a viable interisland strategy. The proposal, which the DOT accepted and will make a decision on by Oct. 1, allows the carriers to fly 50% of the services.

Keoni Wagner, spokesman for Hawaiian Airlines, affirmed that nonstop mainland-neighbor islands service has created less demand for interisland service. He also said that the general downturn in travel, due to Sept. 11 and the flagging economy, hasn’t helped either.

By coordinating interisland service with Aloha, Wagner said the aim is to “reduce a state of overcapacity in this market that has built up over time. We would coordinate a reduction in total seat capacity in the market, with each carrier flying 50% of the capacity needed each month. We would not coordinate specific flight schedules or fares.”

Wagner said that if the plan is approved, the DOT will oversee its implementation.

In the not-so-distant past, interisland service generated up to 30% of the airlines’ revenue. But these are not normal times.

The proposed cutbacks, which would especially affect Hawaiian locals, are causing some apprehension over the prospect of less-frequent flights and higher fares. However, that fear is less of an issue since the proposed Hawaiian-Aloha merger was called off earlier this year.

Travel agents in Hawaii are watching the scenario with interest.

Danny Casey, president of the ASTA Hawaii chapter, said there has been “very little noticeable impact from any reductions in flights by either airline during the early part of the year.”

If the airlines’ proposed get-together passes scrutiny, Casey said Hawaii’s interisland travelers will need to adjust to a new way of traveling.

“Customers will have to start making their reservations much more in advance of travel to ensure their desired airline and flight times,” Casey said. “The days of just showing up at the airport with a coupon and catching the next available flight will be gone in most circumstances.”

Casey said brand loyalty may also disappear, replaced by when and where travelers need to go.

“Although several people have said that the combining of schedules will lead to higher prices, the reality is that interisland pricing is difficult to predict, because there are forces at work in the marketplace that push prices up and keep prices down,” he said.

Rachel Shimamoto of All Ways Travel in Honolulu agreed that something needs to be done.

“It’s like twins going on a diet it trims the schedules for a realistic fit,” Shimamoto said, noting that passengers have been spoiled with a lot of choices. “And perhaps they have to stick to taking the flight that’s booked; no more no-shows since there were so many flights to choose from.”

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