Aloha Airlines files for bankruptcy
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Advertiser Staff
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Aloha Airlines filed for bankruptcy protection today for the second time in just over three years.
The state's No. 2 carrier filed for Chapter 11 reorganization with the U.S. Bankruptcy Court in Honolulu, listing assets and liabilities both in excess of $100 million.
Aloha has been hurt recently by low-interisland airfares and high fuel costs.
The airline said it hopes to protect the jobs of its 3,500 employees, honor all travel reservations and keep air cargo moving between the Islands.
In its filing, Aloha said it wasn't making enough money off inter-island routes because of "predatory pricing by Mesa Air Group's go! airline."
"In the highly competitive inter-island market, Aloha was forced to match go!'s below-cost fares at a time when the airline industry was facing unprecedented increases in the cost of jet fuel," the company said
"It is a travesty and a tragedy that the illegal actions of a competitor and other factors completely beyond our control have forced us to take this action," said David A. Banmiller, Aloha's president and CEO, in a statement. "Through this filing, we hope to achieve a successful outcome that will protect the jobs of 3,500 dedicated employees who have made extraordinary sacrifices for Aloha, and to continue to earn the support of our loyal customers, business partners, vendors and financial backers."
Aloha said it will seek the court's approval to continue operating with financing from its principal working capital lender, General Motors Acceptance Corp.
Mark Dunkerley, president and CEO of Hawaiian Airlines, the state's No. 1 carrier, issued a written statement.
"The action taken by Aloha Airlines today reflects the difficult operating environment in Hawaii's airline industry," Dunkerley said. "It is extremely challenging and marked by high operating costs, record high fuel prices and a very competitive pricing structure."
"Fortunately at Hawaiian Airlines we have made many tough operating decisions in the past year and customers have responded positively. We know the local airline industry will continue to change and I'm confident that our employees are up to the challenge."
Gov. Linda Lingle issued a statement on the bankruptcy filing: "I am very concerned about the 3,500 employees who have sacrificed a lot over the years. I am hopeful that this action will allow Aloha Airlines to successfully emerge from reorganization as they have done in the past.
"The continued, uninterrupted service of the airline is in the best interest of the employees, Hawai'i residents and visitors and our state's economy. We will continue to monitor this situation and any potential impacts resulting from Aloha's filing today."
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