Tuesday, May 13, 2008

Where are the Cheap Seats?

The Lowest Fare

The cost of inter-island travel has definitely gone up. The days of the fare war between Mesa Airlines' Go! and the other inter-island carriers is over. Fuel costs are up, Aloha Airlines is out of the passenger business and Mesa settled their $90 million lawsuit with Hawaiian Airlines out of court for $52.5 million.

Here is the latest breakdown of fares for a typical inter-island trip between Honolulu and Hilo for May 30 to June 11.

MESA AIRLINES' GO

Mesa advertises a low Go! airlines fare of $54 one-way (photo above). Reality check? I went to their website, and fares for my travel window were stated at $59, $69, $74, $89 or $94 depending on day and time of travel. Where's that $54 seat?

HAWAIIAN AIRLINES

Hawaiian Airlines remains the inter-island airline leader despite higher prices. They added more flight capacity and carried more passengers since Aloha Airlines called it a day on March 31. Hawaiian's fares for my travel window range from $59 on the low end to $109 on the high end. This is for coach seating, depending again on the day and time of travel. Note that some of Hawaiian Airlines' flights to Hilo stop at Maui before continuing. And they cost $84 for more time in the plane.

ALOHA AIRLINES

Totally out of the passenger business, Aloha Airlines continues to operate their freight service with hopes that they will be bought by another firm real soon. The airline closed their cargo operations for a few days and filed Chapter 7 bankruptcy, which was a smart move on their part. This allowed them to continue the selling negotiatons without having to deal much with their unions as the airline was technically liquidated upon Chapter 7 filing.

ISLAND AIR

Flying to Hilo on Island Air? First you have to love prop planes to undertake this trip. Second you have to plan for at least 3 hours of travel time between Honolulu and Hilo. All of Island Air's flights to Hilo and back involve at least 1 stop on Maui. Two of their 3 Hilo flights also stop on Molokai. Price for these long flights? $73 or $83. Island Air is an airline to use if you are going to rural airports on the islands of Maui, Molokai and Lanai. The are not a very good choice for going to Hilo from Honolulu.

HAWAII SUPERFERRY

They're not an airline. They are a ship. They don't go to Hilo but are planning on Big Island service starting next year to Kawaihae. Currently they sail at least once a day to and from Honolulu to Kahului. Hawaii Superferry's current fare is $39 per person each way. $55 each way for your standard sized vehicle. The prices go up to $49 per person and $65 per vehicle starting in June.

Yes, the heyday of cheap inter-island travel is over. Our travel choices are less. Bottom line is that if anyone wants to go anywhere, some serious financial bullets are going to have to be bitten. And of course people will adjust and probably travel less.

2 comments:

MauiBrad said...

Yeah, I just bought a one-way interisland ticket for $125 which was about the best deal available for a calm transit of less than 1 hour.

Prices do seem to be going up with fuel costs.

Interesting that the PUC lets one of the interisland carriers offer rates below their cost. Wasn't that what Hawaiian and Aloha sued Go! over?

Aloha, Brad

mel said...

Inter-island air fares are not regulated by the State. When Go! came to market, they had deep pockets and a goal to drive one of the incumbents out of business. They lowered their prices to ridiculously low levels, and the public bit. Of course both Aloha and Hawaiian played their game, even though no one forced them to.

Mesa/Go achieved their goal. They drove Aloha out of business and they are now probably the #2 carrier in the market. And of course now they have to make up for a lot of lost cash, hence they raised their prices right along with Hawaiian and Island Air. Increased fuel costs certainly plays into this, but now with the market back to 2 major carriers, Go and Hawaiian can now fix the prices in the inter-island market.

Having a third inter-island is always a good thing for the consumer since it has been shown to bring prices down. Mid Pacific Air, Mahalo and Go all proved that. The former 2 were under financed and ran out of money playing the game, but Go won out despite suffering huge losses for the first 2 years of operations in the island. Now they are going to have to prove themselves to be a profitable operation, more than likely at the expense of the consumer.