Pilot's plan for Hawaiian Airlines cuts wages 10 percent

By Debbie Sokei
Advertiser Staff Writer

A Hawaiian Airlines pilot has assembled a plan to bring the airline out of bankruptcy by cutting union wages 10 percent for two years and giving employees stock in the company.

Robert Konop, who has been flying for Hawaiian for 19 years, said he plans to file his reorganization proposal with the bankruptcy court tomorrow. His will be the second reorganization plan submitted to the court, and at least two more parties are expected to file plans.

Hawaiian Airlines filed for bankruptcy in March after John Adams, the chief executive at the time, could not reach an agreement with Boeing Capital Corp. to reduce the leases on Hawaiian's fleet. Adams had intended to bring the airline out of bankruptcy, but the court removed Adams on Boeing's request and appointed a trustee. Now the court is accepting proposals to reorganize the carrier.

Earlier this month Corporate Recovery Group LLC, a Wyoming-based turnaround company, filed a plan that included a $30 million injection of capital to help bring Hawaiian out of bankruptcy.

Konop said he hopes to find investors to add a cash component to his plan.

Rusty Ayers, spokesman for the Air Line Pilots Association, hasn't seen Konop's plan but is concerned that it lacks the financial backing to turn the airlines around.

"There are several plans that have money behind them, and this plan has no money behind it so that would put it at the bottom of the list," Ayers said.

Ayers said the association is still reviewing CRG's proposal, which will freeze the pilots pension fund.

Hawaiian Holdings Inc., the parent company of Hawaiian Airlines, and Vx Capital Partners, a San Francisco-based airline investment company, are also expected to file competing bids.

Konop's plan is not likely to go over well with union employees who have given back millions of dollars in concessions in the past to help keep Hawaiian Airlines flying.

"As far as we are concerned, based on the company's finances, we gave concessions last year and we don't need to give anymore," said Edward Gilmartin, in-house counsel for the Association of Flight Attendants. "The flight attendants made the sacrifices for the company and obviously it has been working out."

Reach Debbie Sokei at 525-8064 or dsokei@honoluluadvertiser.com.