Hawaiian Airlines has had its fair share of ups and downs over the past decade with two filings for Chapter 11 and an infamous FBI investigation, but where expansion is concerned the drawback has always been obvious, after all there is not much you can do when your hub is sitting on an active volcano in the middle of the world’s largest ocean.
The opening up of the skies over Japan has suddenly moved Hawaii from the periphery of the Americas to the centre of a new booming market. Moreover the continued rise of South East Asia puts Hawaii at the centre of two economic superpowers. So it is logical that the 50th state’s largest and oldest carrier should embark on the biggest international expansion in the company’s 81-year-old history. Tomorrow the carrier will make its maiden flight from Honolulu to Japan’s Haneda International Airport (You may recall that the airline secured one of four US slots under the US/Japan open skies agreement late last year).
Hawaiian Airlines is also taking advantage of the US visa waiver program with South Korea to launch services in January 2011 to Incheon International Airport, which is just 45 minutes out of Seoul.
Is Hawaiian taking a big risk? Yes is of course the answer, while the economic recovery is still fragile. The USA is in a great deal of economic trouble and make no mistake that if China is not able to maintain its currency at current low levels then it too has a bubble yet to burst. Hawaiian could be caught in the centre of this potential storm. The carrier also now has reciprocal competition with JAL and ANA who fly into Hawaii. That said the carrier has been profitable for the last 10 quarters. It recently signed contracts with all of its labour unions. And its new daily service to Japan and four-days-a-week service to South Korea will complement its Manila route that launched in 2008. The services to Japan and South Korea will be undertaken with the current Boeing 767 aircraft in the fleet before they eventually switch to the newly acquired 294-seat Airbus A330-200s which should provide far more value on the routes.
This expansion news gives Hawaiian access to a much larger market but the real key for Hawaiian will be in the relaxation of visa rules for Chinese visitors, which will result in a great opening for the airline, with routes running in Japan and South Korea the carrier is well placed for the future. Ultimately, Hawaiian will cast an eye toward Europe after it begins receiving the first of six new Airbus A350XWB-800s in 2017 that will allow the airline to fly nonstop between Hawaii and anywhere in the world. Keep one eye on Hawaiian as they could be a merger target when the new aircraft transform them into a global carrier. No other airline has more to gain from the A350/787 types.
Meanwhile the C919, the Chinese rival to the A320 and 737 is to include lessors CDB and GECAS along with Hainan Airlines and ICBC and the big three Chinese national airlines, see APAC leasing section below for more.