Posted on: Tuesday, March 15, 2005

Update expected on plan to start low-cost airline

By Dan Nakaso
Advertiser Staff Writer

James Delano, who founded Lion Coffee in 1979, has been preparing for months to launch a low-cost, interisland, turbo-prop airline and will announce the progress on his plans tomorrow.

Delano's FlyHawaii Airlines has set up headquarters in the Topa Financial Center on Fort Street and as of yesterday was still advertising for jobs ranging from human resources director to chief pilot to aircraft inspector and maintenance supervisor.

Last week Chris Parsons, FlyHawaii's vice president of administration and former campaign attorney for former Mayor Jeremy Harris, said the company had yet to make applications to the U.S. Department of Transportation or the Federal Aviation Administration.

"It's all premature," Parsons said last week.

Yesterday, Parsons declined to say specifically whether FlyHawaii had made any applications.

FlyHawaii arranged tomorrow's announcement in response to media reports that included inaccurate information, Parsons said.

In general, he said, "nothing's really changed. We're going to empty our pockets onto the table. We're just going to tell people what we do know."

Scott Ishikawa, spokesman for the state Department of Transportation, said FlyHawaii also needs permission for space at Hawai'i's airports, as well as clearance from consumer protection and other state officials.

"The company has shown interest with us, but we have not received any official word yet on when they plan to begin airline operations," Ishikawa said.

FlyHawaii's plans come during difficult times for the airline industry worldwide and specifically in the Islands.

Hawai'i's largest airline, Hawaiian, is scheduled to emerge from federal bankruptcy under new ownership on April 1 after two years in Chapter 11. Aloha Airlines filed for bankruptcy on Dec. 30.

In May Aloha's parent, Aloha Airgroup Inc., sold its turbo-prop subsidiary, Island Air. Island Air competitor Pacific Wings has been filing complaints with the U.S. Department of Justice over code-sharing agreements between Hawaiian, Aloha and Island Air that the company calls anti-competitive.

So far, Parsons said, FlyHawaii has about 20 employees. The senior management team includes:

• CEO Delano, who sold Lion Coffee in 2000 and after the Sept. 11 attacks traveled to Pakistan, Afghanistan, Israel and Iraq to see the effects of the United States' war on terrorism.

• Parsons, a former KHON-TV reporter, producer and executive editor who became an attorney. Parsons served as First Deputy Corporation Counsel for the city and was a key campaign strategist for Harris, as well as serving as a partner in the Honolulu law firm of Im Hanifin Parsons.

• Lori McCarney, vice president/marketing, most recently of Bank of Hawaii where, according to FlyHawaii, McCarney "rebuilt its reputation after the bank had made numerous missteps and established a reputation for being able to successfully turn around difficult business situations." McCarney is active with the Blood Bank of Hawaii, Aloha Festivals, Kapiolani Health Foundation and other charities.

• Carl Christoffersen, chief financial officer, who most recently served as controller and chief financial officer of Great Plains Airlines, a Tulsa, Okla.-based regional airline.

• Bob Brayton, vice president of operations, who most recently was president and CEO of Mid-Atlantic Airways. Brayton's 16-year senior management aviation career includes positions with Allegheny Airlines, Virgin Express Airlines and Continental Express, where he also was chief pilot.

Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or 525-8085.