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The Honolulu Advertiser

Posted on: Saturday, August 11, 2001

All Nippon plans to cut Nagoya-Honolulu flights

By Andrew Gomes
Advertiser Staff Writer

The second-busiest airline serving Hawai'i from Japan announced yesterday that it will reduce its service to the state by more than a third, cutting 7 of its 18 weekly flights to Honolulu.

All Nippon Airways said that, effective Oct. 27, it will end its daily service to Honolulu from Nagoya, Japanís fourth-largest city.

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All Nippon Airways said that, effective Oct. 27, it will end its daily service to Honolulu from Nagoya, Japan's fourth-largest city.

The airline said demand remained strong, but the move was prompted by a need to centralize its international operations at Tokyo's Narita airport and eliminate operating losses from a route that contributed to a $143 million net loss for its parent company last year.

ANA, Japan's largest airline, has lost money on its overseas routes since adding them in 1986.

The company warned in May that it was considering ending its Nagoya-Honolulu flights, the only international service the carrier operates out of Nagoya.

"We couldn't gain any economies of scale by having an international hub at Nagoya," ANA spokesman Thomas Fredo said yesterday.

ANA accounts for about 13 percent of all flights from Japan to Hawai'i. The airline began serving the state in January 1997 out of Nagoya, after an initial foray into the Hawai'i market from 1991 to 1993. ANA also flies here four times a week from Tokyo and started daily service from Osaka's Kansai airport last year.

Osamu Kawabata, ANA senior vice president and general manager for North and South America, said the airline remains committed to Hawai'i. He added that the service cancellation will not affect the company's 14 employees in Honolulu.

But the reduction announcement yesterday did concern travel wholesalers and local tourism officials.

Japan-Hawai'i air service is an issue because the number of available seats in the market has dwindled by 18 percent since its peak in 1997, to 2.4 million, according to the Hawaii Visitors & Convention Bureau.

"There are times when the number of air seats are limiting the number of people who come to Hawai'i," said Steven Matsuo, the bureau's director of sales for Japan.

ANA's plan to stop flying a 370-seat 747 from Nagoya to Honolulu every day will further reduce the number of seats by about 130,000, or another 5 percent. The company said about 76 percent of those seats were filled, on average — 10 percent more than the ANA average for international flights.

Other carriers, including U.S. airlines, have contributed to the overall seat cutbacks in the last few years. But there is hope that a second runway scheduled to open at Narita in May will allow airlines to boost service to Hawai'i.

Kawabata said ANA hopes to increase its Narita-Honolulu service from four flights a week to every day pending availability of new runway landing slots and government approval. But a lack of aircraft would make any addition unlikely before 2003, he said.

Japan Airlines, Hawai'i's dominant carrier from Japan with 84 flights a week and a nearly 60 percent market share, expects the second Narita runway will allow it to expand air service to the state over the next two years.

A JAL spokesman in New York said the carrier does not have details about how many more flights to Hawai'i may be added.

The expansion at Narita may ease the tightening of seats to Hawai'i from Japan over the long-term, but tourism officials still expect a net loss compared to recent years.

Furthermore, travelers from Nagoya, where about 2.2 million people live, will be left with only one airline with direct service to Hawai'i.

JAL operates daily service from Nagoya to Honolulu. Matsuo said having only one choice has tour wholesalers in Japan concerned. "It's going to limit us to one supplier, and the number of people using that supplier is not going to go down," he said.

Yujiro Kuwabara, planning and contracts general manager for tour firm JTB Hawai'i Inc., said Nagoya residents may be inclined to travel to other vacation destinations better-served from the city instead of coming to Hawai'i via connection from Tokyo or Osaka airports.

"We are preparing for it, but for the customer it's still inconvenient," he said.

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.