Island Air Continues to Show Loss

According to a report issued by the U.S. Department of Transportation, Island Air has just posted its six consecutive quarterly loss during the third quarter of 2014. The quarterly loss amounted to $2.6 million, which is a relatively small amount for its owner, billionaire Larry Ellison, who purchased the airline in February 2013.  Forbes magazine recently noted that Ellison is the fifth person in the world with a net worth of $51.3 billion.

David Pfliger, the President and CEO for Island Air, stated, "The airline's sixth successive quarter of losses with a new owner was not surprising given Island Air's rebuilding efforts and the extremely challenging, competitive environment. It is a result of this continuing trend and other factors that the company is undertaking a comprehensive strategic review of our fleet, network, and other key aspects of our business to design a business plan that will ensure our future success. It remains our goal to provide our customers with a reliable and a superior travel experience while creating an airline that can grow and serve the islands profitably."

Source: Honolulu Star Advertiser, 12-16-2014, www.staradvertiser.com
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Island Air CEO Paul Casey to Step Down and Dave Pflieger to Take Over

Island Air has announced that Paul Casey, the CEO for the airlines for the past 16 months, will be stepping down on October 1, and David Pflieger, the president and CEO of Silver Airways, will take over his position.  Casey will be given an advisory role on Island Air's board of Directors.  This news has come as a surprise to members of the airline community.  Peter Forman, a local aviation historian, stated, "That's a big surprise. The work that Mr. Casey has begun is not completed yet. He has had a very difficult culture change to bring about at Island Air and it's been successful so far. But the work is not done yet and someone needs to continue his work. I sincerely hope that Paul Casey remains actively involved with the airline because the airline needs his involvement."

Casey mad the following official statement, "It has been an enjoyable experience to work with the ownership and employees of Island Air as we rebuilt the company from the ground up. It would not have been possible without their support and commitment, and I look forward continuing this progress in my new role as a senior adviser to the board." Regarding the hiring of Pflieger, Mike Boyd an airline consultant stated, "He's a good choice. There aren't many regional independent airlines left in America, and he comes from one of the survivors.  (Larry) Ellison is a success-focused businessman, and after buying Island Air, it makes sense to bring in high-powered people to run it."

Source: Honolulu Star Advertiser, 9-3-2014, www.staradvertiser.com
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Island Air Posts $3.3 Million Loss in First Quarter of 2014

According to a report released by the U.S. Department of Transportation, Island Air has posted a $3.3 million loss during the first quarter of 2014.  Island Air is a private company owned by billionaire Larry Ellison, but is still required to report its financial data to the Department of Transportation.  Due to the deep pockets of Ellison, experts in the field aren't especially worried and simply feel that Island Air needs some time to turn around its operations.  Peter Forman, an aviation historian, stated, "Island Air is working very hard on improving the quality of its product, and they've made tremendous headway there, but there is a delay between the time you improve your product and the response by the traveling public. I would expect their revenue would be improving in the future, which will affect their bottom line."

Island Air currently operates more than 250 weekly flights between Oahu, Maui, Kauai and Lanai.  The airlines is currently phasing out its older 37-seat Bombardier planes for newer 64-seat ATR-72 turboprop planes.  Forman added, "The solution (for Island Air becoming profitable) will be on the revenue side and whether it attracts enough passengers to fill those seats better in the future.  I remain optimistic about the long-term prospects for Island Air. The disappearance of go! (airline) will help Island Air's numbers in the future."

Source: Honolulu Star Advertiser, 6-24-2014, www.staradvertiser.com
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Island Air CEO Has Lofty Goals

Paul Casey, the Chief Executive Officer for Island Air, has some lofty goals for his company, but as the former CEO of the much larger Hawaiian Airlines, Casey feels confident that he will be able to reach them.  Casey stated that over the last year since taking over the inter-island airline, he has been working to change the culture and increase the pride that his employees have for the job.  Casey added, "By Hawaiian Airlines standards we are very small, but with size comes the personal touch and flexibility and we are privately owned."

Island Airline is owned by billionaire Larry Ellison, who, according to Forbes magazine, is the fifth-richest man in the world with a net worth of $48 billion.  Ellison also owns 98 percent of the island of Lanai, including the two Four Seasons properties there.  On March 31, 2014, Island Air announced that they will be purchasing two brand new Q400 NextGen turboprop aircraft, and have the option of purchasing four additional planes depending on demand.

President and CEO of the Hawaii Tourism Authority, Mike McCartney, stated, "Island Air has been doing some exciting things under Paul Casey's leadership.  The most important thing is they have the capacity to invest in new aircraft, which will help them stay competitive and grow as an interisland airline. With the loss of go!, Island Air's presence has become even more important to the interisland travel market."

Vice President of Brand Management for the Hawaii Tourism Authority, David Uchiyama, added, "Based on the direction and leadership that I see with Island Air, as well as the new ownership, the quality of the aircraft that they're investing in and their efforts to improve service levels, it looks very promising. Paul is very experienced in this market having been the leader of Hawaiian Airlines for so long. So I'm very confident that he is going to provide the direction needed to make Island Air very competitive in the market."

Source: Honolulu Star Advertiser, 5-4-2014, www.staradvertiser.com
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Island Air to Expand Interisland Service

Island Air has announced that they will be expanding their interisland service by the end of this year.  The airline stated that they have purchased two new 71-seat Bombardier Aerospace Q400 NextGen turboprop planes to increase service to Maui, Kauai and Lanai.   President and CEO for Island Air, Paul Casey, stated, "They will add to our existing fleet and allow us to explore new opportunities."  Casey added that the airline may add an additional four more Q400 planes in the near future, and commented that the new planes are more fuel-efficient, less costly to maintain and quicker.

Island Air currently operates more than 200 flights per week between Oahu, Maui, Lanai and Kauai, and uses five 64-seat ATR-42 turboprop planes.  The ATRs are all about 20 years old.

Source: Honolulu Star Advertiser, 4-1-2014, www.staradvertiser.com
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go! Airlines' Departure Predicted to Not Hurt Neighbor Island Tourism Too Much

Tourism experts are predicting that the recent announcement by go! Airlines stating that they will be leaving the Hawaii market will not hurt neighbor island tourism too much.  go! Airlines took up only 6.8 percent of the interisland market share, as compared to Hawaiian Airlines which currently controls 85.2 percent of the market share.  Hawaii Tourism Authority's vice president of brand management, David Uchiyama, commented, "(Go! was) flying a pretty minimal schedule. There will be an impact, but not as great as if they were flying six aircraft like they were before. They were down to two aircraft."  Uchiyama noted that Hawaiian Airlines, Mokulele Airlines and Island Air should sufficiently be able to absorb all of go! Airlines flights.

Source: Honolulu Star Advertiser, 3-18-2014, www.staradvertiser.com
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'Ohana by Hawaiian Airlines Gets Ready for Debut

'Ohana by Hawaiian is scheduled to make their debut service from Honolulu International Airport to the islands Molokai and Lanai.  President and Chief Executive Officer for Hawaiian, Mark Dunkerley, stated, "Frankly, we are in a situation where we believe that the existing operators don't deliver an adequate level of service. This is going to be a very small operation but nonetheless one which we think, allows us to fill a puka in our network." Currently Hawaiian Airlines takes controls 85 percent of the inter island market, and this new service to the smaller airports will only help secure its dominant position.  'Ohana will fly 48 seat ATR 42 aircraft which utilize twin-engine turboprops.  They will offer three daily flights to Molokai and two flights per day to Lanai.

Island Air announced last month that they will no longer be offering service to the island of Molokai.  CEO for Island Air, Paul Casey, stated, "The increased competition did not play a role in the decision. Based on Ohana's seat capacity to Molokai, we feel that the island will have adequate air service to meet its needs."

Peter Forman, an aviation historian, commented, "If 'Ohana by Hawaiian follows Hawaiian Airlines' tradition of reliability and on-time service, it will raise the bar for competitors in these less populated markets. What I foresee is a significant improvement at Island Air in coming years, so overall the level of service by both carriers will benefit the people of the neighbor islands."

Source: Honolulu Star Advertiser, 3-9-2014, www.staradvertiser.com
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Island Air To Cancel Service to Molokai

Island Air has announced that they will be discontinuing service to Molokai after April 1, 2014. The company, which was close to bankruptcy when it was purchased on February 26, 2013 by billionaire Larry Ellison, still appears to have some financial challenges, and they plan to streamline their operation.  David Uchiyama, the vice president of brand management for the Hawaii Tourism Authority, commented, "I understand that Island Air is going through a redevelopment plan of their product.  I thought we were going to see some growth from them going forward, and I'm sure we still will. I have not talked with them recently and will be trying to connect with them so we can get updated on their plans. I'm sure they are building a strategy in the market. They are making substantial investment, most recently in the lounge at the airport. I think there's still more to come. We just need to wait and be patient. There's a big picture why he (Larry Ellison) is making those investments."

Hawaiian Airline has announced that they will be creating a new subsidiary called Ohana by Hawaiian.  Ohana has announced that they will be offering service from Molokai to Oahu starting on March 11.  Ohana will use the 48 seat ATR-42 airplane and will offer three flights per day to Molokai.  However, Ohana will not offer any cargo service, something that Island Air did.

Source: Honolulu Star Advertiser, 2-23-2014, www.staradvertiser.com
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Hawaiian Airlines to Create 'Ohana Airlines for Smaller Airports

Hawaiian Airlines has announced that they will be creating 'Ohana by Hawaiian, a subsidiary that will competed directly with Island Air and Mokulele Airlines with flights to the smaller airports on Molokai and Lanai.  'Ohana by Hawaiian will be operated by Empire Airlines, an Idaho-based company, and has just welcomed in its first 48 passenger ATR-42 turboprop airplane. Crews have begun their training and will have to demonstrate to the FAA that they are ready for daily operations before they are given official clearance to start service.  'Ohana initially plans to have a total of three ATR-42 planes and will provide daily service been Honolulu, Molokai and Lanai.

Source: Honolulu Star Advertiser, 1-14-2014, www.staradvertiser.com
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Island Air May Purchase Aloha Airlines Name

Island Air is currently in discussion with Yucaipa Cos. to purchase the rights to the Aloha Airline name.  Yuciapa had purchase the Aloha name for $1.5 million in 2010 as part of Aloha's liquidation.  Island Air was purchased in February 2013 by billionaire Larry Ellison, who also owns 97 percent of the island of Lanai.

Bruce Nobles, the former CEO of Hawaiian Airlines from 1994 to 1997, thought that the possible name change would be a very interesting one.  Nobles stated, "It has its pluses and minuses. The pluses would be there was a lot of loyalty, a lot of people were strongly tied to Aloha and liked Aloha, and a lot of people in the marketplace fondly remember the name. So if you could take advantage of that, if it still exists, that obviously would be a powerful positive.  On the other hand, the company went into bankruptcy twice, failed, shut down, and a lot of people lost their jobs. Those are not things that people like to remember."

Source: Honolulu Star Advertiser, 8-4-2013, www.staradvertiser.com
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Second and Third Largest Interisland Airlines May Form Partnership

Island Air and go! Airline's parent company, Mesa Air Group, are working out details to form a partnership that will combine the second and third largest interisland airlines together.  While this may not mean too much of a threat for Hawaiian Airlines, which has approximately 85 percent of the interisland market share, it would mean that the combined Island Air/go! company would have about 12 percent of the market share.  Currently Island Air operates four 64-seat ART 72 turboprop aircraft and offers 210 flights per week.  Go! has five 50-seat CRJ 200 jets and provides about 280 flights a week.  While a consolidation would mean that some routes may be combined, it may also mean increased service or an expansion to other routes.

Island Air's CEO, Paul Casey, stated last month, "We are committed to building a strong regional airline, and part of that process is exploring all options, including discussions with Mesa Air."  Casey has no additional comment regarding any update of those discussions.  President and CEO of Mesa, Jonathan Ornstein, also remained vague about any ongoing discussion and stated recently, "There are often good reasons why airlines merge or combine operations.  Some people may recall that we had hoped to do a transaction with Aloha (Airlines) when we first entered the market. Given all the potential benefits, a deal with Island Air is certainly something we would take a careful look at."

Source: Honolulu Star Advertiser, 7-14-2013, www.staradvertiser.com
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Hawaiian Airlines Starts New Route to Sendai, Japan

Hawaiian Airlines has added a new direct route to Sendai, Japan.  The flight will take approximately eight hours and 26 minutes and will be offered three days a week.  Hawaiian Airlines' Chief Commercial Officer, Peter Ingram, stated, "Sendai is a little like Sapporo.  It's a market that hasn't had the benefit of direct service. We think there's an opportunity to stimulate some of the demand by establishing a direct link between Sendai and Hono­lulu."

When asked about other international routes planned by the airline, Ingram added, "We've actually got a little bit of reduction in our growth rate next year.  We've been growing very, very rapidly over the last two years. Next year, while we have some new (A330) aircraft coming onboard, we also have some aircraft retiring. That means there's less new route additions over the next couple years than you've seen over the last few."

Peter Ingram also did not see very concerned about billionaire Larry Ellison purchasing Island Air and go! Airline.  Ingram stated. "Frankly, Mr. Ellison is not the first millionaire to buy an airline in the state.  He may be the first billionaire, but he's certainly not the first millionaire to buy an airline. We're obviously paying attention to what they're doing. We're prepared to remain competitive, and, really, our focus is on what we do."

Source: Honolulu Star Advertiser, 6-26-2013, www.staradvertiser.com
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Larry Ellison Considering The Purchase of go! Airlines

Larry Ellison, who purchased 97 percent of the island of Lanai in June 2012 and who purchased Island Air in February 2013, has announced that he is in discussions with Mesa Air Group, the parent company of go! airline.  Island Air's chief executive officer, Paul Casey, stated, “We are committed to building a strong regional airline and part of that process is exploring all options including discussions with Mesa Air,”  Mesa Air Group created go! airline in 2006.  Mesa filed for Chapter 11 bankruptcy in 2010 and emerged out of it in 2011.

Peter Forman, a Hawaii aviation historian, commented that Larry Ellison is "making a play to become the second serious interisland competitor.  It's a major move.”  Forman noted that if Island Air does combine with go! Airline, neighbor island flights should become more competitive due to increased service.

Source: Honolulu Star Advertiser, 6-21-2013, www.staradvertiser.com
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Hawaii Tourism – Paul Casey Named CEO of Island Air

Island Air has announced that Paul Casey will become the new chief executive officer for the company starting on May 1, 2013. Casey was the president and CEO of Hawaiian Airlines from 1997 to 2002 and was also the president and CEO of the Hawaii Visitors and Convention Bureau from 1995 to 1997. Casey stated, “Having been part of Hawaii’s visitor and airline industries for the past three decades, joining Island Air at this time is an exciting opportunity. I look forward to working with the Island Air team to deliver high-quality air service and provide improved options for interisland travelers.”

Island Air was purchased in February 2013 by billionaire Larry Ellison and the Oracle Inc. Ellison purchase 97 percent of the island of Lanai in 2012. Les Murashige will remain as the president of Island Air.

Source: Honolulu Star Advertiser, 4-23-2013, www.staradvertiser.com
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Hawaii Tourism – Island Air to Stop Flights to Kapalua, Maui

Island Air has announced that effective May 31, 2013, they will no longer be offering flights to Kapalua Maui on the west coast of that island and will instead be only flying to the main airport in Kahului.  Island Air’s president, Les Murashige stated, “We regret that we will no longer serve Kapalua.  We are pleased that we can expand service to Kahului with the addition of our new ATR 72 aircraft.”  Murashige explained that Island Air would be replacing their planes from Dash 8 aircraft to the larger ATR 72 which were too large to land at Kapalua Airport.  This announcement will leave Mokulele Airlines as the only schedule carrier to fly in and out of Kapalua.

Source: Honolulu Star Advertiser, 3-26-2013, www.staradvertiser.com
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Island Air Owned By Larry Ellison

Island Air has confirmed that billionaire Larry Ellison has completed a deal to purchase their company. Paul Marinelli, a representative of Ellison, stated, “Make no mistake about it, the airline will be increasing service to all the islands, not just Lanai. It goes without saying that Island Air is critical to the island of Lanai, and that certainly was the impetus for beginning discussion. But as we got into it, what we realized is there’s an incredible market opportunity here for all the islands, and we fully intend to engage that opportunity.”

Island Air currently has approximately 5 percent of the state’s inter-island market. President of Island Air, Les Murashige, stated, “Mr. Ellison has already demonstrated a strong commitment to Hawaii, and we are proud to have an owner with the resources and desire to facilitate our expansion plan. This is a very exciting day for the Island Air ohana as well as the entire state of Hawaii. Mr. Ellison brings resources to build the airline, so we plan to service all the communities of Hawaii, which we feel will benefit both kama­aina and visitors alike.” It was also announced that Murashige will remain as President of Island Air.

Larry Ellison is the CEO and co-founder of Oracle Corporation, and is the third-richest man in the United States. Ellison made headlines in 2012, when he purchase 97 percent of the island of Lanai.

Source: Honolulu Star Advertiser, 2-27-2013, www.staradvertiser.com
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Larry Ellison to Purchase Island Air

Island Air has announced that the new buyer for the company is going to be none other then billionaire Larry Ellison. Ellison made headlines in 2012 when he purchased 97 percent of the island of Lanai. Island Air is currently the third largest interisland airline and has an approximate 5 percent of the market share. Ellison is the co-founder and CEO of Oracle Corp and is the third-richest person in the United States with an estimated net worth of $41 billion. The exact sales price for the purchase of Island Air has not been disclosed.

Source: Honolulu Star Advertiser, 1-18-2013, www.staradvertiser.com
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Speculation on Island Air’s New Owner

Island Airline, the third largest regional airline in the state of Hawaii, has announced that they have reached a preliminary agreement with an unnamed buyer of the company. According to Island Air officials, the new buyer is still doing their due diligence and are reviewing the airline’s books. Island Air also stated that all 245 employees will keep their jobs under the new ownership.

The Hawaii Tourism Authority’s vice president of brand management, David Uchiyama, commented, “We’re waiting to hear how this thing evolves. Our concern is that they get certification for that new aircraft that they brought in so they can get it up and flying. We’re very concerned about the interisland market and the competitive playing field we’re dealing with. One of our initiatives here is to be able to distribute more of our visitors to the neighbor islands, and any interisland carrier becomes an integral part of that — Hawaiian, Island Air, go!, Mokulele. We’re concerned about them (Island Air) going under very much so.”

Source: Honolulu Star Advertiser, 1-17-2013, www.staradvertiser.com
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Island Air to Be Sold to Undisclosed Buyer

Island Air has announced that they will be selling their company to an undisclosed buyer. The deal is expected to close sometime within the next six to eight weeks. Current president of Island Air, Les Murashige, stated that due to his nondisclosure agreement, he could not identify the buyer or the price at this point. However, Muarshige did state that there are not any plans to play off any of the company’s 245 employees. Murashige commented, “This is very positive for all the employees of Island Air as well as the communities that we serve. It’s business as usual. At the appropriate time we’ll hopefully be adding more flights to the system.”

Island Air remains the third smallest interisland passenger service with approximately 5 percent of the market share. In comparison, Hawaiian Airline has the largest interisland market share at 84 percent, followed by go! airline with 8 percent. The company offers 322 flights per week and has a total of three planes in its fleet. Murashige added, “The finances of the company are fine. We’re struggling along. We’re OK, but we’re not making money hand-over-fist. I truly believe we can be the solid No. 2 carrier. We have no delusions of thinking that we can take over the world or be the No. 1 carrier. We’re just looking to be No. 2 as an alternative for people who want to travel on us.”

Source: Honolulu Star Advertiser, 1-11-2013, www.staradvertiser.com
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Island Air Expands with 5 More Leased Airplanes

Island Air has announced that they will be leasing five additional ATR 42 turboprop airplanes to help expand their fleet. According to their press release, Island Air hopes to replace its entire fleet with new planes. Chief Executive Officer Lesley Kaneshiro stated, “These aircraft represent an integral part of our plan to deliver on our service commitment to the ever-increasing number of guests flying with us each day. It’s a very exciting time at Island Air as we have a lot to look forward to.”

The first two 46 seat ATR 42s will join the fleet by the end of this year. The additional three will come online by the summer of 2013. Current the airline offers 350 weekly flights throughout the state and has a total of 250 employees. Kaneshiro stated that new routes will be announced shortly and additional workers will be hired.

Source: Honolulu Star Advertiser, 9-11-2012, www.staradvertiser.com
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