When it comes to places with an abundance of short-haul flying, it is hard to beat Hawaii. Many of the islands are small enough not to have all of the essential services that their residents may need, though within the chain of islands they are available. And in a place where tourism is the number one industry, there must be a way for visitors to access the majority of the state, even though the vast majority of flights to and from the islands arrive at a single airport.
Many island chains have ferry service, however in Hawaii that service remarkably doesn’t exist today. A short-lived high-speed ferry system that opened several years ago took hours to transit the roughly 100 mile distance between Oahu and Maui. It closed after a judge ruled that the permitting process was flawed and the operator went bankrupt. Inter-island flying is now the only way to go.
In Hawaii, flying is king and competition is fierce. The last decade has seen both the entry of new carriers into the marketplace and some high-profile failures. Historically, there were two tiers of airlines providing service between the islands: large commercial airlines that flew to both the mainland and to major airports within the state, and commuter airlines that linked the major airports with smaller outlying airports. However in the last ten years, those lines have become blurred. Today, the air transport industry in the state finds itself in a state of flux.
The Big Carriers
From the 1940s through the late 2000s, there were a pair of homegrown airlines that provided service between Hawaii’s five major airports (Honolulu, Kahului, Lanai, Hilo, and Kona). The original entrant in this market was Hawaiian Airlines. Hawaiian had been flying around the islands since 1929 and to the mainland and other islands in the South Pacific since the mid-1980s.
Recent decades had seen a sizable chunk of the interisland flying operated by various models of the Douglas DC-9 and McDonnell Douglas MD-80 family, while flights to the mainland and other South Pacific islands began with a fleet of DC-8s and Lockheed L-1011s before both of those fleets were retired and replaced with DC-10s.
Hawaiian’s chief competitor was Aloha Airlines. Founded in 1946, Aloha focused primarily on inter-island flights, which have been flown on a fleet of 737-200s since the 1960s. In the year 2000, the airline acquired ETOPS-certified Boeing 737-700s and began flights to California with them. The airline briefly dabbled in long-haul widebody service to Guam and Taipei in the 1980s, using a leased DC-10. However the competition with Continental Airlines on those routes was too great, and they quickly ended the experiment after less than a year.
The 2000s were not kind to both Aloha and Hawaiian. Hawaii’s location and status as a major tourist destination for both the United States and Asia subjected it to the effects of problems on both sides of the Pacific. Economic problems on each side of the ocean, along with the SARS outbreak and skyrocketing fuel prices, forced both carriers into bankruptcy in 2003 and 2004.
Although each carrier emerged from bankruptcy after about two years, Aloha once again filed for bankruptcy protection in 2008 and quickly shut down its passenger operation. The cargo and ground services divisions were both eventually sold off. Today, Aloha Contract Services still handles operations for customers such as Alaska Airlines. Meanwhile, Aloha Air Cargo operates a small fleet of 737-200 freighters around the state.
Hawaiian Airlines was more fortunate during that challenging time period. The early 2000s saw the airline replace its less efficient DC-9s and DC-10s with more efficient Boeing 717-200s and 767-300s, respectively. Unlike Aloha, Hawaiian Airlines emerged from bankruptcy a stronger airline. In the past nine years, the airline has experienced significant growth, especially in long-haul flying where the 767-300s are slowly being replaced with and augmented by Airbus A330-200s. But it is the short-haul operation, using the 717s, that is the rock of the operation.
Hawaiian consistently boasts the best on-time performance of any major US carrier (they are currently the 8th-largest). That record is largely due to the frequent service that the airline provides between the islands, which the airline calls “neighbor island flights”. These flights are where Hawaiian got its start all those years ago, and they have seen slow but steady growth over the years. In fact, the demise of Aloha Airlines in 2008 generated enough additional inter-island demand that Hawaiian was forced to lease a few additional 717s.
Service is so frequent that some routes, such as Honolulu (HNL) to Kahului (OGG) see over 20 flights each day. These flights are, in many respects, the Hawaiian equivalent to inter-city bus service on the mainland. Large waiting rooms serve several gates, and passengers tend to form orderly lines for boarding. Onboard, the service is basic but completely adequate. Due to the ultra-short nature of Hawaiian’s neighbor island flights, there is no inflight entertainment provided (other than a window of course!) There is however a beverage service. All passengers are offered a foil-lidded cup of either water or Passion-Orange-Guava juice.
The Regional Airlines
Hawaiian Airlines’ inter-island competition currently comes primarily from two carriers, go! and Island Air. Both of these carriers use regional-size aircraft. Island Air has a small fleet of five ATR-72-200s, each with 64 seats onboard in a single class configuration. These aircraft were acquired from American Eagle Airlines in 2013 as it was phasing out the type. Meanwhile, go!, a subsidiary of regional carrier Mesa, currently operates a fleet of 3 Bombardier CRJ-200ER/LR. These aircraft hold 50 passengers and were formerly operated by Mesa for America West Express.
This 50 to 100-seat segment of the inter-island market has been particularly volatile over the past 10 years. However, in all of the turbulent air, Island Air has been relatively stable. The turboprop operator has seen two changes of ownership, in 2003 and again in 2013.
Today it is owned by Oracle CEO Larry Ellison, who also owns 98% of the island of Lanai. The carrier maintains a hub in the commuter terminal at Honolulu International Airport, with flights to two other major airports: Lihue and Kahului. Because of the airline’s use of turboprops, it is also able to serve the smaller runways in Lanai and Molokai, although service to the latter is scheduled to end on April 1, 2014.
Prior to the acquisition of the ATR-72s in 2013, Island Air had been a longtime Bombardier Dash 8 operator. Beginning in 1995, the airline operated the Dash 8 100, 200, and Q200 series of aircraft. It even operated the Q400 for a short period of time. Hawaiian Airlines had a codeshare agreement with Island Air to provide service to a few smaller airports within the state until 2012.
The short history of go! has been much more turbulent. Founded by Mesa in 2006, the airline’s life began with a lawsuit. Mesa had been given confidential information during Hawaiian Airlines’ bankruptcy, as the regional carrier considered investing in the bankrupt airline. Hawaiian alleged that Mesa used that information to start a competing airline, in violation of a clause in the non-disclosure agreement. After more than two years of litigation, and a verdict in Hawaiian’s favor, the carriers reached a settlement whereby Mesa paid Hawaiian $52.5 million.
go! has also had an on again/off again relationship with commuter carrier Mokulele Airlines throughout its history. Shortly after go! began operations in 2006, they developed a codeshare with the commuter airline to allow go! to sell tickets to smaller airports. That agreement ended in 2008, when Mokulele entered a partnership with one of Mesa’s competitors to provide inter-island jet service. But we are getting a bit ahead of ourselves here. When the joint venture failed, go! merged with the commuter carrier, only to divest the small turboprop operation in 2011.
Today, go! is right back where they started: operating their own CRJ-200 flights while codesharing with Mokulele. But not for long. go! recently announced that it is shutting down its operation on April 1, 2014. Though Mesa has cited the need to redeploy the go! CRJ-200s elsewhere in the system, it is more likely that it needs the pilots from the operation to support its growing regional flying operation in a time when regional carriers are struggling to find enough qualified pilots.
Just as go! is leaving Hawaii, an old friend with a new name is arriving. Hawaiian Airlines has launched ‘Ohana by Hawaiian, in order to seamlessly serve smaller airports in the state. Initially, ‘Ohana will be serving the islands of Lanai and Molokai. ‘Ohana’s flights use a trio of 48-seat ATR 42-500s that were formerly owned by Czech Airlines. These aircraft are operated by Empire Airlines under contract with Hawaiian, thus forming the first true regional carrier within Hawaii. ‘Ohana launched flights to Molokai on March 11, 2014. Flights to Lanai began a week later on March 18, 2014. Not incidentally, these two destinations are the same ones that Island Air served with a Hawaiian Airlines codeshare until 2012.
The Commuter Airline
There is just one entrant in this category, the aforementioned Mokulele Airlines. Mokulele operates a fleet of nine-passenger Cessna 208 Grand Caravans. The single engine turboprops hop around the islands, generally connecting small airports with larger ones. Mokulele is currently in the midst of replacing its older Cessna 208Bs with factory new, glass cockpit-equipped Cessna 208EXs
From its focus cities at three of the five major Hawaiian airports (Honolulu, Kahului, and Kona), the airline flies almost exclusively to smaller, outlying airports that cannot support the larger planes. These include the smaller islands of Lanai and Molokai, as well as airports such as Kapalua and Hana on Maui and the airline’s newest destination: Waimea-Kohala on the Big Island. That destination was added late in the summer of 2013, using money from an Essential Air Service (EAS) grant.
Mokulele knows that its fleet of small (but not too small) Cessnas give it a unique position in the interisland marketplace. It can operate into small airfields such as Kapalua that cannot handle larger airplanes easily. In fact, the only airlines to serve the 3,000 foot runway on the western coast of Maui are Mokulele and FedEx Feeder, both of which use the Cessna 208.
However, do not let the small size of Mokulele’s airplanes fool you. The little airline knows how to dream big. It has, at various times, been a codeshare and joint venture partner with go! over the past eight years. The only major gap in that agreement came in 2008 when it tried to grow in a different way.
Mokulele formed a partnership with Republic Airways Holdings, a competitor of Mesa’s on the mainland. This partnership saw a pair of Shuttle America Embraer E170s brought to the islands. The Embraers wore Mokulele’s livery and operated between Honolulu, Lihue, and Kona. It was just like a typical mainline airline partnering with a regional airline, except here the mainline carrier operates much smaller planes than the regional does. Six months into the arrangement, financial difficulties with the turboprop operator led to Republic’s purchase of 50% of the smaller carrier.
However the arrangement soon ran into difficulty. In October of 2009, just a year after it had begun, Republic pulled out of Hawaii and Mokulele quickly merged with Mesa to form go! Mokulele. That arrangement too was short lived. Just over two years into the merger, Mesa divested the turboprop operation to Transpac Aviation of Arizona. Today, Mokulele continues to codeshare with go!, at least until the end of the month that is.
This story was written by Ben Granucci who is an aviation enthusiast and planespotter based in New York City. Growing up in Connecticut, he has had his eyes toward the sky for as long as he can remember. He is an Associate Editor at NYCAviation. He can be reached on Twitter at @BLGranucci or through his blog at Landing-Lights.com