The state's third-largest airline said customers can purchase $12 return tickets until Thursday for travel through March 15.

Island Air, which laid off 15 percent of its work force on Dec. 1 and cut five flights, first offered the $12 return fares earlier this month. Competitors Hawaiian Airlines, Aloha Airlines and go! declined to match the special fare.

"The response we received ... was overwhelming," said Island Air Chief Executive Officer Rob Mauracher.

Founded in 1980 as Princeville Airways, Island Air is a niche-player in the interisland market. The company, owned by San Francisco-based Gavarnie Holdings LLC, operates 75 daily interisland flights.

On Dec. 1, Island Air announced it was laying off 65 of its 415 employees as a result of the new low-fare environment. The company also eliminated five of its 17 interisland routes and said it will take two of its 37-seat De Havilland Dash-8 aircraft out of service.

At the time of the layoffs, Island Air's Mauracher said go!'s launch this year destabilized the interisland fare structure, forcing Island Air to reduce its expenses.

Go!, a unit of Phoenix-based Mesa Air Group, triggered a fare war when it opened for business on June 9 with an introductory $39 one-way fare.