Neighbor Island legislators tried to convince Hawaiian to lower airfares and reduce flight restrictions, citing a growing problem with interisland fares as high as $200 for a round-trip ticket.

Mark Dunkerley, Hawaiian's president and chief operating officer, said the airline — which filed for bankruptcy in March — is "working very hard to get our costs down," but had no immediate plans to lower fares.

Hawaiian is restructuring under Chapter 11 of the bankruptcy code and a critical element of the proceedings is renegotiating its aircraft lease with Boeing Capital Corp.

"I was disappointed that they (Hawaiian) didn't come with any good news about lowering airfares," said Rep. Jerry Chang, D-2nd (Hilo). He has said Big Island families are finding it hard to get to funerals and other events on other islands because they can't afford to fly interisland.

Dunkerley said fuel costs are a continuing problem and added that cutting costs is a double-edged sword because "when we talk about reducing costs it very often means pay cuts, furloughs.

"If we can get our costs down we would like to be able to share some of the benefit with the traveling public," Dunkerley said.

MARK DUNKERLEY

Regarding Aloha's lower ticket pricing, Dunkerley said Hawaiian is "studying it at the moment." But he said he believes Hawaiian's current airfares are a good value based on the service provided, including good on-time ratings and Internet check-in capabilities.

For Chang that's not enough.

"Most people would rather get lower costs than the kind of service that they're touting," he said.

Hawaiian reports profits

Meanwhile, Hawaiian reported yesterday it had $4.2 million in operating profit in November on revenues of $57.4 million.

The company said those were its best financial results of any November, and marked the eighth consecutive month of operating profit. In November 2002, Hawaiian had an operating loss of $2.4 million on revenues of $54.8 million.

Hawaiian's operating profit year-to-date totals $64.1 million, including $17.5 million under the federal Emergency Wartime Supplemental Appropriations Act to cover an industrywide suspension in passenger security fees. The airline saw revenues of $635.6 million. In the same period last year, Hawaiian had an operating loss of $46.2 million on revenues of $570.3 million.

Chang said "it's kind of puzzling" that Hawaiian said it needed to lower its costs "when they announced that they had the best November ... and are making record profits."

Legislators also met with new owners and executives of Island Air. The new owner, Gavarnie Holding, plans to close a deal to buy Island Air from Aloha's parent company on March 1.

Island Air operates 46 flights a day from Honolulu to Kahului and Kapalua on Maui and to Moloka'i and Lana'i. Officials expect to add 50 daily flights, with the first new flights running from Kahului to Hilo and Kona on the Big Island.

Island Air officials said fares would be competitive with Aloha but did not want to discuss details.

"We're just appreciative that they came into the market," Chang said of Island Air. "That's good news."

Chang said the next issue lawmakers plan to tackle is rental-car rates on the Big Island that he described as high. He plans to call meetings with rental-car agencies to discuss the problem.