Wednesday, May 6, 2015

Hawaii's Island Air cuts services on $22 million loss in 2014

(Island Air)

Honolulu-based regional carrier Island Air will cut services and staff following a $22 million loss in 2014, with a significant $12 million loss in fourth quarter alone.

The carrier blamed intense competition from local carriers Hawaiian Airlines and Empire Airlines for the income slump.

“We knew that to [maintain our business] in the face of overwhelming competition from other local airlines which ... control nearly 90% of the intra-island market would not be without its challenges,” Island Air CEO Dave Pflieger said.

As a result of the loss, Island Air also announced a freeze on new aircraft orders along with the 20% staff cut, effective June 1. This could directly impact last year’s order of six Bombardier Q400s, worth up to $188 million, as replacement for the carrier's current fleet of five ATR 72s.

The cuts mean Island Air will also close its operations on Kauai and all flights from Lihue and now be flying just two routes; Honolulu to Kahului and Lanai City.

(Jeremy Torr - ATWOnline News)

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