As someone who routinely flies between the Bay Area and Hawaii, say 4x/year for the past decade, generally speaking fares below $400 RT are a good value.
As an MBA: Southwest intimated their entry will be aggressive. in the
most recent quarter their CASM (cost per available seat mile) was 12.10, and RASM was 14.13.
OAK-HNL is 2,409 miles each way, or 4,816 miles RT. This would imply that the average cost to sell a seat would be $582, and revenue $680. The thing to know about longer flights, e.g. Hawaii, is that the CASM should be lower than average because the plane spends more time flying versus being on the ground and is a high fixed cost on a bunch of different variables.
I weekly commute OAK-RNO, and assume that one of the largest costs of the flight is the time boarding people.
Part of why WN is a great business is that it loves making money off of customers without charging asinine fees. As their labor costs have risen Southwest can no longer always be the cheapest bet out there. Still---
Hawaiian Airlines recently reported a CASM of 12.40 and RASM of 13.76, so all other things being equal Southwest could offer slightly less expensive fares (at break even 12.40-12.10=.30 delta per mile times 4816 miles =$14.44 cheaper/flight. Probably not enough to sway elites from either airline (not to mention AA+AS+DL+UA+etc) from their brand loyalty.
From my perspective t
his is all about a West Coast-focused airline (Many describe WN as a "Californian airlines headquartered in Texas")
wanting to offer a frequent flyer program that reflects a regional preference to vacation in Hawaii versus the much father afield Caribbean.