Will Southwest's entry into the inter-island market lower fares?
Mar 6, 2019, 7:04 am
#46
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I personally find it hard to believe $29 fares vs. the usual $80 one way or so on Hawaiian will "easily double demand" - I just don't see $100 rt making that much of a difference - unless it is a day trip, you still have to get a hotel, car, etc - and anyone who has been to Maui the past few years knows the price of hotels on Maui aren't exactly inexpensive. If demand really goes up - plan to see hotel rates go up from already high amounts.
Mar 6, 2019, 8:32 am
#47
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This all reminds me that I still have my boarding passes from my HNL-KOA flights in Sept of 2007 on AQ. $20 all in round trip. It’s great that AQ is thriving now; all that competition worked out well for it.
I agree that $29 fares won’t last. The $10 oneways on AQ was in response to go!’s entry into the market. That didn’t last either.
I agree that $29 fares won’t last. The $10 oneways on AQ was in response to go!’s entry into the market. That didn’t last either.
Mar 6, 2019, 11:55 am
#48
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I wish WN well in trying to serve the inter-island market but will be curious to see if they encounter the same engine problems with the CFM-56 that Aloha had (which is why they ended up going back to the older 737-200 aircraft and rarely used the 737-700 on the short hops.
Mar 6, 2019, 6:39 pm
#49
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As we learned from the "go!" days, demand for interisland travel is relatively price inelastic. So large drops in fares on the aggregate will not result in significant increases of demand for interisland travel.
My hunch is that after the initial hoopla and WN intro fares passes thru (with temporary bump in demand to go with it), average fares will decrease slightly for interisland flights outside of the mid-day "rush" and the two will coexist as long as HA holds the schedule/frequency advantage over WN. I'll be curious to see how long it takes before (whether) WN achieves interisland load factors similar to that on their other intra-Texas or intra-CA flights.
My hunch is that after the initial hoopla and WN intro fares passes thru (with temporary bump in demand to go with it), average fares will decrease slightly for interisland flights outside of the mid-day "rush" and the two will coexist as long as HA holds the schedule/frequency advantage over WN. I'll be curious to see how long it takes before (whether) WN achieves interisland load factors similar to that on their other intra-Texas or intra-CA flights.
Mar 8, 2019, 12:28 pm
#50
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A couple observations.
1) Yes, WN is sitting aircraft longer, so they can let the engines have the requisite cooling period. Still, I do wonder if WN is either wishing they kept the 717 around or will look at something else for interisland, if this takes off.
2) The competition will be a good thing.
The 737 on LAX-SAN-LAX is about moving the aircraft around, getting gates free at LAX for other RONs and acting as a catch all for IRROPS. I've bought/miled separate LAX-SAN or SAN-LAX tickets for various reasons, but most people who are doing that as an O&D flight are commuters.
That data is deceiving. That is including all the folks who are on tags from flights from the mainland, whether on HA or partners who are selling HA tickets. Those tickets yield little. The O&D interisland tickets are quite expensive.
Go was very different. They used very inefficient, less comfortable aircraft relative to HA, and didn't have the same feed.
1) Yes, WN is sitting aircraft longer, so they can let the engines have the requisite cooling period. Still, I do wonder if WN is either wishing they kept the 717 around or will look at something else for interisland, if this takes off.
2) The competition will be a good thing.
I've done SAN-LAX a few times to catch connecting flights as part of award tickets and I'm always surprised as to how many are actually on said flights. United even flies a 737 on that route (granted, the vast majority of the flights are still on regional jets). That said, it's likely that most other passengers were connecting in LAX and not originating from there.
The data does not support that claim. Let's take the same public data source, and look at all 45 domestic U.S. market-carrier combinations with significant traffic (>50 daily pax), <200 mile stage length, and marketed and/or operated by a major U.S. carrier. If we look at the 15 with the LOWEST fares, we find that all 7 markets that HA serves <200 miles are among the cheapest 10 of 45 similar markets nationwide, YE2Q18.
As we learned from the "go!" days, demand for interisland travel is relatively price inelastic. So large drops in fares on the aggregate will not result in significant increases of demand for interisland travel.
My hunch is that after the initial hoopla and WN intro fares passes thru (with temporary bump in demand to go with it), average fares will decrease slightly for interisland flights outside of the mid-day "rush" and the two will coexist as long as HA holds the schedule/frequency advantage over WN. I'll be curious to see how long it takes before (whether) WN achieves interisland load factors similar to that on their other intra-Texas or intra-CA flights.
My hunch is that after the initial hoopla and WN intro fares passes thru (with temporary bump in demand to go with it), average fares will decrease slightly for interisland flights outside of the mid-day "rush" and the two will coexist as long as HA holds the schedule/frequency advantage over WN. I'll be curious to see how long it takes before (whether) WN achieves interisland load factors similar to that on their other intra-Texas or intra-CA flights.
Mar 8, 2019, 1:01 pm
#51
Join Date: Nov 2017
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Updated for YE3Q18 ... in this table fare is simply O&D base fare (what goes to the airline). Gross fare includes taxes and is the 'all in' value that a customer would pay in total.
https://imgur.com/a/BR8tzHA ... first number column is PDEW, second is base fare, third is gross fare, fourth is O&D revenue.
Last edited by CRJ200flyer; Mar 8, 2019 at 1:03 pm Reason: Table didn't display properly
Mar 9, 2019, 6:55 pm
#52
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Besides local O&D, all the legacies and many int'l carriers feed into HA's interisland network while WN's only feed is.....other WN flights. And once WN gets all their mainland flights running, it will cannibalize their own interisland traffic, thus they will need to rely on local traffic to fill the aircraft.
In addition to competing with HA, the biggest impediment to WN running an HA-style interisland schedule will be the lack of gate space across the islands.
For having a monopoly in the interisland market, HA has been a responsible carrier with its position. In the end I think WN will run an interisland schedule commensurate with their allocated gate space across the State, average fares will go down, HA will still have the schedule/frequency advantage, and both will coexist in the market.
Mar 12, 2019, 11:16 am
#53
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I do think it will give some pause to fly the SWA 737 MAX 8 they plan on deploying on the Hawaii routes....
Southwest?s Hawaii routes will use same type of planes involved in 2 deadly crashes
Southwest?s Hawaii routes will use same type of planes involved in 2 deadly crashes
Mar 12, 2019, 11:55 am
#54
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I do think it will give some pause to fly the SWA 737 MAX 8 they plan on deploying on the Hawaii routes....
Southwest?s Hawaii routes will use same type of planes involved in 2 deadly crashes
Southwest?s Hawaii routes will use same type of planes involved in 2 deadly crashes
Mar 14, 2019, 10:22 pm
#55
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WN will be using the -800 for HA till the MAX issue is resolved. From what I've heard the flight crew schedules are 3 and 4 day trips. Day one is flying from Mainland to HI, day 2 or 3 is island hopping, last day is flying back to Mainland. The Hawaiian market is the most requested market for the largest California airline.. Imagine in a year or two you have an am and pm flight from BUR/SNA/LAX/SMF/OAK/SAN/LAX/LAS/PHX and maybe PDX and SEA to Hawaii then those inter island hops go up exponentially, which then compete with HA's 21 daily departures between HNL and KOA (as an example). Been to HI enough to know that inter island is mostly locals/business travel. Those short hops is what made WN in Texas. Keep the 2 bags free and maybe a free drink from HNL to KOA for the honeymooners. HA is going to be able to offer Australia, New Zealand, Japan, Tahiti plus their codeshares and other destinations for their FF's and it could be interesting.
Mar 15, 2019, 12:48 am
#56
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Lived in Hawaii long enough to know it’s a bit more complicated than that. Interisland is a mixture: local business,local personal, westbound tourists, eastbound tourists, etc, varying by route and time of day. Southwest has deep pockets and an operating model that works well on the continent but hasn’t been tested 2500+ miles from home. HA knows the market intimately and runs a very good operation but is small and somewhat vulnerable to competition and a potential economic downturn. It’s going to be an interesting ride.
Mar 15, 2019, 1:23 pm
#57
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It is a lot less challenging to deal with a mechanical in California or Texas, than as you put it, 2500+ miles from the mainland.
HA can absorb fares going down to $49 each way but a huge advantage they have, especially interisland, is those B717's only fly interisland and they have spares.
Mar 21, 2019, 10:09 pm
#58
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Thing that has not been discussed here is that as the day goes on Southwest is almost always running behind schedule. So all these interisland flights are with mainland jets.....so when there's a 2 hr delay on a flight the interisland flight is going to suffer the same delay. With 3 or 4 interisland flights a day how long are people going to put up with a delay like this? My guess when they have to sit for 2 hrs to take a short interisland flight, they;ll think twice the next time.
Mar 22, 2019, 12:38 am
#59
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Thing that has not been discussed here is that as the day goes on Southwest is almost always running behind schedule. So all these interisland flights are with mainland jets.....so when there's a 2 hr delay on a flight the interisland flight is going to suffer the same delay. With 3 or 4 interisland flights a day how long are people going to put up with a delay like this? My guess when they have to sit for 2 hrs to take a short interisland flight, they;ll think twice the next time.
Mar 22, 2019, 6:57 pm
#60
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On the other hand, WN is building in significant block time and turnaround time for the interisland flights in part due to the issues with the 737's engines. Not to mention that the weather in Hawaii is usually pretty good and that the flights to Hawaii itself from the mainland are currently timed to be pretty early in the morning.