slippahs

New prices start June 1

Current one-way fares:

$67 Low
$75 Mid-price
$85 Highest

As of June 1:

$77.50 Low
$85.50 Mid-price
$95.50 Highest

See: http://www.flyertalk.com/forum/Forum...ML/006405.html
and
http://the.honoluluadvertiser.com/ar.../bz/bz02a.html
for article

... which makes those 5k rewards on UA/CO/NW/AA ever more valuable...

------------------
Aloha! Hailing from paradise. www.gohawaii.com

winstoda

Remember, AAA still has cheap Aloha fares. $61.15 one way.

slippahs

But who knows how long that will last...

LIH Prem

I wonder at what point they will actually break even? (at least according to them.)

Mrs LP priced out midweek fares the other day from LIH to KOA, and we couldn't find anything under $200 or so.

I tried the UA/AQ miles route, but nothing was available on the flights she wanted.

-David


[This message has been edited by LIH Prem (edited 05-22-2003).]

slippahs

Maybe we should try like the old days and use our double hulled canoes to travel between islands...

But seriously... with skyrocketing prices for neighbor island trips, it's a wonder just how high these prices might go. Is this just a cause and effect of the economy or is this the new "norm" of interisland travel? I think Hawaii's air carriers are in a pretty big jam if they can't break even on their flights. Of course, that's the obvious... but are there real solutions for Aloha and Hawaiian to stay afloat besides raising the cost of tickets? One can only dream about the old days (which was really only a year ago) when one could buy a coupon, phone in a reservation and hop on a plane.

That double hulled canoe isn't sounding too bad right now....

Aloha

onedog

I don't understand why Aloha and Hawaiian are losing money? For similar fares, the discount carriers like WN, JetBlue etc. will take you on much longer flights? Are their loads so low that they need to charge the few passengers they have high fares to compensate for empty planes?

I know all the arguments about comparing WN to full service carriers, but IIRC, interisland flights on Aloha and Hawaiian are about 30 minutes long and are pretty no frills.

slippahs

Hawaiian and Aloha flights are pretty no-frills interislands IMHO, of course... but given a failed merger last year between the two airlines, this cost both airlines big bucks: http://the.honoluluadvertiser.com/ar.../ln/ln03a.html (timeline of merger)

Of course, an ailing tourism economy, smacked by lower Japanese arrivals into the islands has created a lower demand for interisland travel:
http://the.honoluluadvertiser.com/ar.../bz/bz04a.html (is an article from the airlines' first fare hike this year, doesn't quite do the question justice, but does help)
http://pacific.bizjournals.com/pacif...24/daily8.html (explains the Japanese visitor count and importance)

And... finally more flights by domestic carriers between the neighbor islands and the mainland. In fact, United and American offer non-stop service between Kauai, Maui and Kona on the Big Island, and Continental recently announced a new IAH-OGG flight. With more direct flights to these neighbor islands, people are wanting less to make that interisland connection in HNL... and with higher interisland fares on AQ (Aloha) and HA, well... the problems keep rolling.

So... looks like a supply demand problem here... The only way for AQ and HA to stay afloat? Well, continue adding flights from the neighbor islands to the mainland to compete with domestic carriers (which is what they've been doing)... but even that doesn't help the cause for higher interisland fares... they're only adding to their own woes. Of course, low-cost/no-frills carries such as WP and JetBlue on the mainland have their high demand because of the markets they serve... there is a demand for those routes... but Interisland travel is really another realm, that I cannot honestly find the words to explain.

It's a problem that can't be helped... Possible Solution: cut all direct flights from the mainland to the neighbor islands...
Probable Problem: You'll all scream at me... and the domestic carriers will lose their high profits from these direct flights that our visitors love so much...

Perhaps, AQ and HA should just cut all interisland flights, and focus more on the direct flights from the mainland to the neighbor islands... we locals will fend for ourselves by either swimming for it (so what if there are sharks out there... $98 is just too high!) or using that double hulled canoe... why won't anyone buy the idea?

Aloha

Edited to add content

[This message has been edited by slippahs (edited 05-23-2003).]

LIH Prem

I agree with most of what you're saying, but we also have to consider this:

HA and AQ received a waiver so they could coordinate their schedules. The net result of that was that they cut there schedules to the bone. (especially Hilo flights, remember?) Since then, some service has been restored.

HA and AQ both dropped the coupon program claiming that they would be able to do better yield management since the coupons encouraged walk-ups and last minute reservations. At the time, coupons were most useful for locals, since it was possible to find cheaper internet fares for visitors who were on a more fixed schedule. When they dropped the coupons, the plan was not to increase price, but that got thrown away too.

HA is back in bankruptcy because Boeing can't or won't renegotiate leases with the current CEO because of the large bonuses he recieved even as the airline was losing money.

So, I really wonder, at what price point will they make money? Like Southwest, the interisland aircraft take a beating from all the takeoff/landing cycles, but why can't they turn it into a profit? Their workers have all taken paycuts. Where is all the money going?

Also, its still possible to find some of the cheaper fares (even though they are higher than they were before all this) but those cheaper fares are going to be early in the morning or late at night and/or require a change of planes in HNL in some cases.

-David


[This message has been edited by LIH Prem (edited 05-23-2003).]

slippahs

The money seems to be going to just keeping the companies afloat. Yes, I understand the problem and how the fact that the lack of profits doesn't make any sense...
But... you must keep in mind that the airlines rely a lot on Japanese tourists, and according to the new figures released just today (http://the.honoluluadvertiser.com/article/2003/May/23/br/br01p.html), Japanese visitors are down 33.2%.

Domestic/Mainland visitors have the option to fly direct to an island... even if it's cheaper to fly into HNL and take a connecting flight to a neighbor island... studies/visitor travel patterns have shown they would rather take the direct flight to their island of choice.

It's all supply and demand, like I've said. Sure... they have had their anti-trust exemption... sure, they've cut flights (to really 12 a day for both carriers to Hilo)... but it's just not cutting it. Even the paycuts aren't enough to keep the airlines afloat.

So... how high do the prices need to go until supply meets demand? As high as they need to. Without the equlibrium of supply and demand, prices are going to continue to rise. We need to find ways to stimulate the Japanese tourists IMHO back to the islands, or else interisland service will be just as expensive as flying to the mainland.

I know the discrepancies that arise... if airlines follow point A, B, and C.. they should inevitably become profitable again. But maybe the short and correct answer to it is that it just takes time for these things to take effect.

Maybe the airlines need to learn.

Maybe the airlines are hiding something from us.

Maybe... this is just the way it's going to be from now on.

Aloha

slippahs

http://www.alohaairlines.com/aq/aloha_jumppage.htm

Earn United or Aloha miles.

Book by 8/24/2003 and book online for an additional 5% discount.

Happy flying and mai tai-ing!

MisterNice

From www.mauinews.com:

Flying over desert cheaper than flying over water? Read this letter......

"Having just moved to Maui three months ago, it is with great interest that I read the letters to the editor.
I have to agree that Hawaiian and Aloha airlines are ripping off their customers with outrageous prices. You can fly Southwest airline from Los Angeles to Las Vegas - a 40-minute flight - for $50 round-trip!...."

An interesting comparison and both are high density routes.

MisterNice

slippahs

Well, this just reassures the idea that AQ and HA have a monopoly over the interisland market (there are a few other players but they're very small and have little impact). Until the water vessel comes around, I can see prices soaring for these two companies to make any profit they can on the interisland market. It could be that you could fly interisland for peanuts (well, not quite, but $40 OW or even less if you're waaay older than I), but the rise in fuel costs, maintanence costs and a huge slump in demand from foreign/mainland visitors traveling thru O'ahu and the increase in direct flights from the mainland to neighbor islands has caused AQ and HA to do only one thing that will keep them afloat: raise prices.

With a SWA flight between the desert, there's other options... you could drive. You could catch a bus. With a HNL-OGG flight (one of the most heavily traveled routes in the States), you could swim...

AQ and HA also use the wrong planes for this short hop market. HNL-OGG is a 99 mile flight... Sure, it's more comfortable using 717s and 737s to make this trip... but there are other more economical choices out there.

AQ has tried helping the problem by instating legislation backed cheaper fares of $59 OW only if you're a AQ Pass member and book online, but that presents problems seeing that a large part of Hawai'i's community has no access to the internet. And, of course, there's 5,000 miles for a RT fare when using NW or UA miles (the other carriers have since increased the mileage to 10,000), but many people in the islands also doesn't have that resource.

When it comes down to it, people may gripe and complain, but what really can we do about it? Lower the prices, the interisland airlines will fold -- look at Hawaiian. It's about to be sued by Boeing (or really taken over). Aloha, the privately owned company, also has financial problems but is a little more stable than HA.

It might seem misleading now, given that interisland load factors are high on busy days, but that's because both carriers have drastically cut flights to destinations (e.g., to Hilo where there once was only 12 daily flights and made cheap seats impossible).

The interisland scene can also be seen as a microcosm for the greater Hawai'i economy. Who's to blame for all this? The airlines? The economy? Mainland airlines with direct flights to neighbor islands? Who knows -- probably a combination of forces. But the message is clear: if you need to hop to another neighbor island, you'll have to shovel out the cash. Or else, no can help, brah.

aloha

WebTraveler

This whole analysis is ridiculous. You are comparing one route - LAX-LAS to base your claim on. The fact of the matter is that Hawaiian and Aloha are not making a profit on interisland service - the interisland service is costly to operate.

I can find you hundreds of routes across the USA that are significantly higher than the interisland flights. Ever look at Portland-Seattle? For the distance that is often a more costly flight.

The point is that your analysis is ridiculous and the demand is not there for interisland service without connections from mainland travelers. I've been on some Hawaiian flights in the past two years with 8 people on a 717. How the heck do you expect them to make money on this flight?

The interisland market also has to supply a steady stream of passengers for the airlines to make an investment. There is not a consistent steady stream without the connections from the mainland flights. The locals won't pay the reasonable costs to operate these routes. That is a fact.

In the end I think what will happen is that the routes will become subsidized by the state. There is definately a need for interisland travel, no doubt.

MisterNice

Yes and no. For years HA and AQ made a reasonable income by flying mostly inter-island. It is only when they decided to go big-time did they get into financial problems. They bought the higher priced and lower fuel efficient extended B767. The B717 is a great short flight airplane because of its excellent fuel efficiency, low noise, low pollution and far less maintenance than the worn-out DC-9-50 it replaced. Fuel costs aint that much difference from elsewhere, and actually some people have stated it should be cheaper in HI as it is closer to the well head. The state started a investigation but dropped it like a hot potato.

As for internet access for AQ fares, every library I have seen in Hawaii has *FREE* internet access for Hawaii residents and for a fee for others who cant show local residency. This is not true for most or many mainland 48 state libraries I have visited. Other than just after 9/11 I have never seen an inter-island flight with less than approx 70% load factor……ie higher than many 48 to 48 state flights I have been on. Most even have a standby list now that the flights have been cut.

HA and AQ continue to operate like third world country national airlines, ie they plead poverty, want subsidies, and “protection” from unknown forces, mysterious villains and the rest of the modern world. HA and AQ are allowed to fly Stage 2 aircraft unlike the rest of the modern world (oh yes, they can fly these in Alaska). When UA wanted to fly inter-island the HA and AQ chiefs went running to their senior senator to have it quashed. They succeeded and the Hawaii residents are paying dearly for it…….day after day.

Open up the Hawaii inter-island market and let economic forces prevail. They actually work fairly well in most of the USA. Only then will prices/fares come down. I would love to see Southwest start service in Hawaii. They soon will be starting it in Philly and prices are already coming down there.

Oh, and don’t ask my opinions on the subsidy to the Hawaii cruise market or the sugar industry, or the lobster industry, or the shrimp industry etc. The Jones Act is stupid and should be abolished not supported by still further subsidies normally given to third world countries.

MisterNice


[This message has been edited by MisterNice (edited Feb 22, 2004).]

slippahs

Why thank you. Controversy is a great thing. There is a fine line between being cautious of info and being cynical, however...

Yes, and well, you should read the point made about more direct flights from the mainland to neighbor islands. Travelers don't want to stop in HNL if there's a more economically feasable non-stop option, and there is. So what if there's only 8 people on an HA flight -- they're not going to make money, yes, but there are many other factors that play into this interisland situation than just supply and demand -- Econ 101 in college should have taught us that long ago.

Well noted. More people traveling directly to the neighbor islands means less people connecting via HNL means higher prices means lower demand.

Not with this legislature and I'm sure not with many to follow. This is why the HI State Legislature has looked to alternative measures. Federal gov't playing in is a different story.

This only describes HA -- can the problem be solely based on HA's purchase of new planes... perhaps. But not completely. Fuel costs have also risen throughout the world, that also plays in.

Yes, but HI ranks as one of the lowest for internet wired computers at public libaries per 5,000 people: http://www.lrs.org/documents/fastfacts/171pcs5k.pdf Any way you cut it... there are people out there who are disadvantaged by it and others who have very little knowledge of using the internet and who can't do anything but go to a HA or AQ counter to purchase a ticket. It's a huge concern of a few state legislators. Knowledge is also power -- many are not aware of this online advantage.

This would be Your Senior Senator as well... Inouye.

No argument there... HI residents don't physically 'pay' for it anymore, they just don't fly and gripe about it as much as possible.

I'd argue that Mahalo Air, Discovery and Mid-Pacific all started a low fare interisland service a long time ago... but they're no longer with us. SWA's model might work in Hawai'i, but it has a long way to go to work against HA and AQ, the dominance and winning the appeal of the kama'aina.

aloha

[This message has been edited by slippahs (edited Feb 22, 2004).]