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The Honolulu Advertiser
Posted on: Sunday, November 17, 2002

Hawai'i air travel bucks downward trend

By Susan Hooper
Advertiser Staff Writer

At a time of financial turmoil for most U.S. airlines, Hawai'i has emerged as one of the industry's few domestic-travel bright spots, with several airlines adding seats on island routes to match growing consumer demand.

Yet local tourism officials are guarded in their optimism, noting that many carriers still face severe financial troubles that could affect service to the state.

According to the Hawai'i Visitors and Convention Bureau, there were 764,667 scheduled nonstop seats to Hawai'i in August — nearly 2 percent higher than the 750,559-seat level of August 2001, just before 9/11.

The bureau estimates the number of scheduled nonstop airline seats to the Islands this year will reach 8.3 million. That's 10.6 percent below the 9.3-million-seat total in 2000 — a year that saw growth in both Hawai'i's economy and its tourism industry. But it's just 1.6 percent below the 8.4-million-seat total last year, indicating a pattern of recovery.

"It's a paradox, in that we have been retrenching on the Mainland and in international flying because of weakened demand, but Hawai'i is a growth story for us," said Joe Hopkins, a spokesman for United Airlines, the nation's second-largest carrier, which has lost nearly $4 billion in less than two years and is facing the possibility of filing for bankruptcy.

"Here's an airline in a serious financial challenge and we're projecting further cutbacks, but in the case of Hawai'i we're going in the other direction, which is nice," Hopkins said. "It says good things about the demand to Hawai'i."

Hopkins said United now has 4,763 seats to Hawai'i, up by 28 seats from November 2001. By next February, however, the airline expects to have 5,391 seats to Hawai'i, up 8 percent from February of this year.

The growth next year is due in part to United's decision to increase its Denver-to-Honolulu service to seven days a week, beginning Feb. 14, Hopkins said. Currently United flies that route two days a week.

Chris Kam, director of market trends with the visitors' bureau, said most of the growth in scheduled airline capacity to Hawai'i is coming out of the Western states.

"That ties into national consumer trends that people are tending to go to destinations closer to home," he said. "We are a rather close-to-home market for the western region of the U.S."

The visitors bureau estimates scheduled nonstop airline seats to Hawai'i from the western part of the United States this year will be less than 1 percentage point below the 2000 total.

By comparison, scheduled nonstop air seats to Hawai'i from the U.S. eastern market this year are projected to be down nearly 23 percent from 2000 levels.

Even as they respond to increased demand from the West Coast, however, the airlines are proceeding cautiously in that market. Hawaiian Airlines has suspended 12 West Coast flights a week — or about 4 percent of its total scheduled seat capacity — from Sept. 3 through Dec. 12, in an effort to trim costs and respond to sluggish demand in the off-peak travel season.

United Airlines is cutting one daily round-trip flight each between San Francisco and Kona and San Francisco and Kahului from Jan. 7 through Feb. 12 because of weak demand in the post-holiday season, the airline said earlier this month.

Japan, another crucial market for the Islands, continues to be slow to recover from 9/11 and the slumping Japanese economy. The visitors bureau estimates the number of scheduled nonstop airline seats from Japan to Hawai'i will be 1.96 million by year's end — nearly 20 percent below the 2.44 million seats from Japan to Hawai'i in 2000.

In response to the slow demand, Japan Airlines announced in August that it will suspend one of its four daily flights between Tokyo and Honolulu from October through March.

Interisland travelers also are facing reductions in service from both Hawaiian and Aloha airlines.

In late September, the two airlines received federal approval for an antitrust exemption that will allow them to temporarily coordinate capacity on several key interisland routes.

Last week, Aloha said it will cut its interisland schedule by about 20 percent starting Dec. 2. Hawaiian has not yet released its plans for interisland schedule changes, although officials said last week they have postponed planned cuts until January because of expected strong demand for interisland travel in December.

Reach Susan Hooper at 525-8064 or shooper@honoluluadvertiser.com.