Hawai'i may soon have a new low-priced airline flying interisland routes.

Phoenix-based Mesa Air Group Inc. wants to start interisland service in Hawai'i in February and says it will undercut fares charged by Aloha and Hawaiian airlines.

Mesa proposes to begin flights from Honolulu to Maui, Kaua'i and the Big Island with as many as 10 50-passenger aircraft and has expansion plans calling for switching to a bigger fleet of larger aircraft.

"We will certainly never be undersold,'' said Mesa Chief Executive Officer Jonathan Ornstein in an interview. "We understand the low-fare model."

Mesa's entry could roil the interisland airline business, which has been marked by air fare wars when other carriers have challenged Hawaiian and Aloha, the No. 1 and No. 2 carriers.

Ornstein said Mesa's low costs, along with getting aircraft at inexpensive lease rates, will enable it to offer fares at a discount. He declined to say how much of a discount.

Aloha and Hawaiian responded that they wouldn't be undersold and said they were well positioned to fight Mesa's entry. The two carriers have outlasted other entrants, including Discovery Airways, Mahalo Air and Mid-Pacific Airlines in the past two decades.

"Others come and go and have great plans and press conferences," said Aloha CEO David Banmiller. "But it just never goes anywhere.''

Aloha, which Thursday announced a $100 million investor infusion to help it exit bankruptcy, has pared $75 million of costs in the past six months and will have lower costs on a per-seat basis than Mesa, Banmiller said.

Hawaiian exited bankruptcy on June 2 and operates trans-Pacific flights in addition to its interisland operations.

"Over the years, our employees have faced many competitive challenges and have overcome them all," said Mark Dunkerley, president and CEO of Hawaiian Airlines, in a written statement. "I trust that the prospect of another competitor in this market will be no different. Our focus will continue to be delivering the best service and value to our customers."

Ornstein said Mesa will be aggressive on setting fares.

"We know we're up against two carriers with a long tradition in Hawai'i and we have to do something to stand out and get people's attention,'' Ornstein said.

Mesa is "a tough competitor; they are the lowest-cost competitor,'' said Bob Mann, a New York-based airline consultant. "They're just very street smart.'"

Mann said the aircraft Mesa has chosen, the twin-engine Bombardier CJR 200, has high per-seat operating costs versus larger aircraft but that Mesa may be able to obtain them inexpensively because of a glut of jets available for lease.

"A new airline coming into the market would be a good thing," said Bill Boyle, owner of Century 21 Kailua Beach Realty and a frequent interisland traveler. "It's gotten so that local families can't afford to fly back and forth. It's very, very expensive."

Boyle said he probably wouldn't switch to a discount carrier for his weekly business trips to the Big Island because of the service he receives as a corporate customer. But he would consider switching if fares fell significantly, Boyle said.

Mesa said it will form a new company to operate in Hawai'i with the help of investors. The Hawai'i operation will not use the Mesa name, but the new name hasn't been selected, Ornstein said.

Ornstein said Hawai'i investors may be among the owners of the venture and that he hopes to hire managers with interisland experience.

Mesa anticipates having several hundred Hawai'i employees. Ornstein said the company believes it can obtain space at Hawai'i airports. He declined to give a specific amount the company and investors plan to put into the new venture, only saying it would be in the "tens of millions.''