New Hawaii Regional Airline

[slatsnfive]

Heard today from various concrete sources, that United/Continental Airlines, has, or, placed an order for 20 Q400s, to be used for the Hawaii inter-island market. Apparently a bid also came out recently for the staffing numbers.

Discuss, professionally please.

Thank you,
slatsnfive

 

[Hypoxik]

Funny......

 

[Mercyful Fate]

Q 400's? I heard 787's for inter-island flying...

 

[altimaklr]

New colgan base for 2012

 

[1st Rate]

I heard the new 737 Max! Should be interesting.

 

[Fubijaakr]

Another failure looking for palace to happen.

 

[SPDBRD747400]

Is there much icing in the Hawaiian chain?

 

[altimaklr]

Q400 is actually ideal for Hawaii. Perfect stage length/fuel burn. No redeye/late flights, so plenty of time for mx. The problem is HA is very entrenched in that market, and it's not very big.

 

[Poahi]

If you give passengers a choice between a Boeing jet or a turbo prop, they are going to take the jet.

 

[SPDBRD747400]

But if the price is right they won't care.

 

[dingo222]

But if the price is right they won't care.

in hawaii, they do care. jet will always trump the tprop in the islands. it is a cultural thing. doesnt make sense, but thats how it is.

 

[IBNAV8R]

in hawaii, they do care. jet will always trump the tprop in the islands. it is a cultural thing. doesnt make sense, but thats how it is.

Price trumps any other trump. Add to that mix the fact that a carrier is actually feeding mainland flights. If AQ was any indication, the spirit of "kokua", "home-grown" and "aloha" mean nothing next to cheap fares.

$29 inter-island fares and HA will be out like yesterday's Spam.

 

[slatsnfive]

If you give passengers a choice between a Boeing jet or a turbo prop, they are going to take the jet.

Your statement is true for certain places, but, here in Hawaii, PRICE, is the determing factor, not jet or turbo-prop.

Passenger surveys have shown, that local travelers require only two thing when flying inter-island. One, they leave on-time, and two, they get the cheapest fare offered.

slatsnfive

 

[Dan Roman]

Price trumps any other trump. Add to that mix the fact that a carrier is actually feeding mainland flights. If AQ was any indication, the spirit of "kokua", "home-grown" and "aloha" mean nothing next to cheap fares.

$29 inter-island fares and HA will be out like yesterday's Spam.

HA will be "out"? No, they will match the fares on some of their seats and instead of making a decent return on inter-island, they will make less. Even if they operated in the red, the airline would still make money elsewhere. If cheap fares were the key to success in Hawaii, what happened to Mid Pac, Mahalo, Discovery, etc? How come Go is doing so poorly? Nobody has ever succeeded in Hawaii, either inter-island or Trans Pac by offering cheap tickets. All those that have tried have failed.

 

[altimaklr]

HA interisland makes money from commuters who's companies are paying top $$ (doctors, etc) and people who are connecting over the ocean. Locals going to see the fam on another island and paying $45 are just extra $$ to fill the seats. You can't make a business off of those fares.

 

[IBNAV8R]

I'm thinking, in this case (if the rumor is even true), HA could be in serious trouble. Aloha went belly up because of a largely unknown, two-bit (to put it nicely) mainland regional offering cheap seats and no feed or code-share. If a recognized brand (I.e. in United/Continental paint) shows up with cheap fares, locals will flock to the deals. UniCal can afford to operate inter-island at a loss, especially by feeding mainline flights.

Don't get me wrong, I'm an HA fan but I don't think the wide-body operation can support a bleeding inter-island operation if there was a serious competitor in the market.

 

[Poahi]

Your statement is true for certain places, but, here in Hawaii, PRICE, is the determing factor, not jet or turbo-prop.

Passenger surveys have shown, that local travelers require only two thing when flying inter-island. One, they leave on-time, and two, they get the cheapest fare offered.

slatsnfive

Not going to happen. HA will match fares and won't let a Q400 operation ruin their market share. It doesn't matter how cheap seat miles are, HA won't be undersold.

 

[Dan Roman]

I'm thinking, in this case (if the rumor is even true), HA could be in serious trouble. Aloha went belly up because of a largely unknown, two-bit (to put it nicely) mainland regional offering cheap seats and no feed or code-share. If a recognized brand (I.e. in United/Continental paint) shows up with cheap fares, locals will flock to the deals. UniCal can afford to operate inter-island at a loss, especially by feeding mainline flights.

Don't get me wrong, I'm an HA fan but I don't think the wide-body operation can support a bleeding inter-island operation if there was a serious competitor in the market.

No worries, but inter-island is a pretty small slice of the operation.
We are in our own little world out here so a lot of misconceptions about Hawaiian exist. Here are some actual facts.

1) Hawaiian has the highest operating profit margin in the industry.

2)Air Transport World had a list of the financially fittest airlines in the world based on 10 different parameters. They ranged from operating profit, balance sheet, relative strength in the markets they served, fuel hedging, suitability of the aircraft they operated etc. Hawaiian was number 1 in the U.S and number 13 in the world.

3) Right now Hawaiian is very well run, outstanding marketing and very strong operationally. We used to at most have anywhere from 20 to 40 million cash and always struggle to get by. Now Hawaiian has 300 million and that's after making constant investments in the operation. We have gone from being a shoe string operation to having all the latest and greatest technological investments made in the airline. They are doing a lot of positive things right now and are not afraid to invest in the well being of the airline.

4) Our Trans Pac flying is more profitable than inter-island. The Asia flying is particularly profitable, strong loads, high yield and very favorable exchange rates

5) We have a better product and lower seat mile costs than any of our competitors to the mainland,

I could go on and on, but the bottom line is, Hawaiian can easily stand a little competition inter-island. Although there is no counter or gate space available to set an operation the size of AQ any more. Inter-island is basically big enough for 1 and 1/2 airlines. Hawaiian survived when they competed with a stronger better run AQ (we were the weak one of the 2 in the 90's). They now have very strong management, a very strong balance sheet, and we just used our own money to refinance the 717's. They are very well suited for inter-island and a weak competitor locally would have a harder time establishing itself than Hawaiian would have surviving a fare war. Obviously we don't want it, but an interisland fare war would hardly kill the airline.


BTW, Go didn't put AQ out of business, they were headed that way for lot's of other reasons, Go was just the straw that broke the camels back. Absolutely no relation between the fitness of HA now vs. AQ when Go came on the scene

 

[General Lee]

No worries, but inter-island is a pretty small slice of the operation.
We are in our own little world out here so a lot of misconceptions about Hawaiian exist. Here are some actual facts.

1) Hawaiian has the highest operating profit margin in the industry.

2)Air Transport World had a list of the financially fittest airlines in the world based on 10 different parameters. They ranged from operating profit, balance sheet, relative strength in the markets they served, fuel hedging, suitability of the aircraft they operated etc. Hawaiian was number 1 in the U.S and number 13 in the world.

3) Right now Hawaiian is very well run, outstanding marketing and very strong operationally. We used to at most have anywhere from 20 to 40 million cash and always struggle to get by. Now Hawaiian has 300 million and that's after making constant investments in the operation. We have gone from being a shoe string operation to having all the latest and greatest technological investments made in the airline. They are doing a lot of positive things right now and are not afraid to invest in the well being of the airline.

4) Our Trans Pac flying is more profitable than inter-island. The Asia flying is particularly profitable, strong loads, high yield and very favorable exchange rates

5) We have a better product and lower seat mile costs than any of our competitors to the mainland,

I could go on and on, but the bottom line is, Hawaiian can easily stand a little competition inter-island. Although there is no counter or gate space available to set an operation the size of AQ any more. Inter-island is basically big enough for 1 and 1/2 airlines. Hawaiian survived when they competed with a stronger better run AQ (we were the weak one of the 2 in the 90's). They now have very strong management, a very strong balance sheet, and we just used our own money to refinance the 717's. They are very well suited for inter-island and a weak competitor locally would have a harder time establishing itself than Hawaiian would have surviving a fare war. Obviously we don't want it, but an interisland fare war would hardly kill the airline.


BTW, Go didn't put AQ out of business, they were headed that way for lot's of other reasons, Go was just the straw that broke the camels back. Absolutely no relation between the fitness of HA now vs. AQ when Go came on the scene

Dan,

My question is how much of your inter-island flying is connections from OTHER airlines? If UAL (who now has CAL in the stable) decided to bring 10 Dash-8-400s over from Colgan for example, and flew them for cheap carrying their own connections (from SFO, LAX, ORD, IAH, DEN, EWR, GUM, NRT, etc), would that affect your business? I know they already have nonstops from LAX and SFO to all of the islands, but the overflow or connections from the other hubs could help fill the planes, or allow their passengers to see more than one island on their trip. United/CAL has the money to do it, and the planes to fly it (Dash-8-400s have plenty of seats to offset the costs compared to a CRJ). If anyone can afford it and do it, I would say UAL could, and they have a NRT flight too that could allow Japan connections.


Bye Bye---General Lee

 

[slatsnfive]

Not going to happen. HA will match fares and won't let a Q400 operation ruin their market share. It doesn't matter how cheap seat miles are, HA won't be undersold.

Poahi,

You misunderstood my statement, entirely.

slatsnfive