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The Honolulu Advertiser
Posted on: Monday, May 10, 2010

Hawaiian Airlines ushers in 'new era'

By Alan Yonan Jr.
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Hawaiian plans to buy a total of 15 Airbus A330-200s like the one above, which is scheduled to start service on the Honolulu-Los Angeles route in early June.

Photos by BRUCE ASATO | The Honolulu Advertiser

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Hawaii news photo - The Honolulu Advertiser

Hawaiian Airlines CEO Mark Dunkerley showed his approval Monday as the carrier's first Airbus A330-200 arrived at Honolulu International Airport.

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An obviously proud Mark Dunkerley smiled as the gleaming Airbus A330-200 rolled to a stop on the tarmac after touching down for the first time at Honolulu International Airport.

For the head of Hawaiian Airlines, the long-range jetliner fresh from the Airbus factory in France represented what he termed a "new era" for the carrier five years after emerging from bankruptcy.

Able to carry more passengers farther and at a lower cost than anything in Hawaiian's existing fleet, the A330 would help Dunkerley achieve his ambition of growing Hawaiian into a much larger player in the international aviation market.

The A330's range of 6,500 nautical miles puts most destinations in Asia within reach of Honolulu. The even longer-range Airbus A350s Hawaiian plans to add starting in 2017 will be capable of reaching cities in Europe nonstop. Hawaiian plans to acquire 15 A330s and 12 A350s over the next decade.

Hawaiian got a jump start on its quest last week when the Department of Transportation tentatively approved the carrier's application to fly daily to Tokyo's Haneda Airport. Hawaiian will initially use its Boeing 767-300ER on the route before adding an A330-200.

Hawaiian hopes to launch its Haneda service in late October, making Tokyo its fifth international destination in addition to Pago Pago, American Sāmoa; Pape'ete, Tahiti; Sydney; and Manila.

"Normally expanding is not a whole lot of fun for airlines," said Helane Becker, an airline analyst with Jesup & Lamont, an investment banking firm in New York. "But when you look at Hawaiian and its strategic plan going forward, this is huge."

"They're the only airline that can use Honolulu as a base, which is exciting. Reason being, they can take people from the West Coast, connect to Manila, Sydney and Tokyo. What they want to do with the A330 makes perfect sense," she said.

"Historically Hawaiian has not been able to get out of its own way, by limiting itself to the Hawai'i (interisland) market. Mark is doing a good job of lessening that dependence on that one market."

Dunkerley acknowledges the Airbuses, which will incrementally replace Hawaiian's fleet of 767s, will allow the carrier to broaden its geographic scope both in Asia and on the Mainland.

But specific destinations on Hawaiian's radar are closely guarded for competitive reasons.

"At any given point in time we have prospective routes, names that move up and down the league table depending on the competition," he said in an interview. "On that list, there are certainly points in Asia and further east than Las Vegas on the U.S. Mainland. But we'll keep our powder dry until makes sense to move forward with them."

Hawaiian, in the past, has shown an interest in China. In 2005, just months before it emerged from Chapter 11 bankruptcy, the Department of Transportation turned down Hawaiian's application for one of two slots from the U.S. to Shanghai. American and Continental airlines were chosen instead.

Local aviation industry historian Peter Forman said it makes sense for Hawaiian to continue its pursuit of routes to Asia.

"Most of Hawaiian's flights are to the West Coast. They still lean in the west-bound direction. It makes sense from a hub standpoint for Hawaiian to increase its flow from Asia to Hawai'i where customers can change planes and go to the Mainland," Foreman said.

"The side benefit is that you will find businessmen or vacationers going from east to west will stop in Hawai'i to shrug off some of their jet lag. It's one of the most beautiful places on earth, why not stop here?"

Forman said the $4.4 billion Hawaiian plans to spend on the 27 Airbuses should prove to be a good investment given that the new aircraft are more fuel efficient and can carry more passengers and cargo.

"Even if you're spending $5 billion over time for the fleet, your actual cost of operations come down over time. And that is key because airlines operate on such thin margins."

One thing Hawaiian can be assured of is that its expansion plans will catch the attention of its larger competitors that see Asia as their domain, said Scott Hamilton, an aviation industry consultant based in Issaquah, Wash.

"There's always a danger when your ambition goes beyond your traditional niche. You draw the attention of guys who are presumably larger with greater resources and deeper pockets," Hamilton said.

"But the fact that Hawaiian has a very dominant position in Hawai'i gives them a sound base of operations to launch from."