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- Hawaiian Airlines
3375 Koapaka Street, G-350
Honolulu, HI 96819
- Main hub
- Honolulu International Airport
- United States of America
- Business model
- Full Service Carrier
- Domestic | International
- Association Membership
- Codeshare Partners
- Air China
All Nippon Airways
Delta Air Lines
Hawaiian Airlines operates from hubs at Honolulu International Airport and Kahului Airport, on the island of Maui. The carrier provides a network of domestic services throughout the Hawaiian islands and to the mainland US as well as international services to Asia, the Pacific and Australia. Hawaiian utilise a fleet of narrow and wide-body Boeing and Airbus family aircraft.
Location of Hawaiian Airlines main hub (Honolulu International Airport)
Hawaiian Airlines share price
1,179 total articles
40 total articles
During the past decade, Hawaiian Airlines has exited bankruptcy protection and embarked on a significant network expansion that required the addition of costly widebody aircraft in a relatively short period of time.
Now the company is beginning to reap some of the benefits of that expansion as its growth has slowed during the last couple of years. Its balance sheet metrics have improved, and it is working to manage its debt levels prudently. In fact, it has beat its targets in some leverage metrics in 2015 and expanded its return on invested capital.
Hawaiian’s outlook for 2016 remains positive. Its forecast capacity growth is in line with its supply expansion during 2015, and its upward margin trajectory should continue. The next major milestone for Hawaiian is the delivery of A321neos beginning in 2017, which will give the airline a new level of flexibility to effectively manage its network.
Just as Hawaiian Airlines has taken a breather from explosive growth in the 2011 to 2013 time period, shifts in overall market dynamics have occurred, including the rapid appreciation of the USD against most global currencies and a sharp fall off in fuel surcharges. Those changes have created unit revenue shortfalls for most US airlines, even as significantly lower fuel prices are producing record profitability.
Although Hawaiian’s business model is different from that of most US airlines, it has not been immune from revenue degradation in 2015. Nevertheless, the airline notes positive trends in its largest geography, North America. Capacity growth between Hawaii and the US west coast slowed to single digits in 3Q2015, with similar trends occurring in late 2015 and early into 2016.
Hawaiian has undertaken some pruning of its long haul network within the last couple of years, and the efforts have borne fruit, although the results are masked by pressures from foreign exchange rates and fuel surcharges. However, overall Hawaiian feels comfortable with its competitive position in the North American and long haul markets despite the headwinds pressuring its unit revenues.
Orlando International Airport is capping off a couple of years of impressive growth in Sep-2015 with the highly anticipated launch by Emirates of new service from Dubai, opening up strategic access for the airport’s passengers to the Middle East and Asia.
The airport during the last year has also welcomed new service to Brazil, Peru, Mexico, Denmark and Ireland. The service additions reflect the unique ability of Orlando International, a non-hub for the large three US global airlines, to attract international service in the post consolidation era of US aviation.
As American, Delta and United ratchet up their anti-Gulf rhetoric, Orlando International is stressing the importance of open skies in its ability to secure new international service. And, ironically, Delta aims to capitalise on the US open skies agreement with Brazil when it launches new Brazilian service from Orlando International in late 2015 as it continues to shake the foundations of the US' open skies regime with opposition to the UAE and Qatar open skies agreements.
The civil war erupts. The rift between the large three global US network airlines and medium sized airlines operating in the country is growing. Airlines housed in those two sectors are on opposite sides of the Gulf "subsidy" campaign waged by American, Delta and United. This is reflected in the recent partnering of JetBlue and Hawaiian Airlines, along with other airlines, to create the US Airlines for Open Skies Coalition to promote benefits of the open skies agreements the US holds with over 100 countries.
But Hawaiian and JetBlue are also publicly denouncing the detriments of a fundamental tenet of the business strategy adopted by the large three US airlines during the last decade – immunised joint venture agreements. Hawaiian and JetBlue believe joint ventures have resulted in higher fares and decreased consumer choice.
JetBlue has requested that the US government review joint ventures to ensure those pacts benefit consumers. US regulators recently have shown an eagerness to undertake scrutiny of the country’s largest airlines, so JetBlue believes it has favourable odds of gaining traction on its request.
Alaska Air Group is adding a solid mix of regional, transcontinental and international routes in 2015, which is one driver in its projected 10% capacity growth. Other elements of its ASM expansion include frequency additions in core markets and aircraft upgauge.
The company is adding eight new flights from its largest hub and headquarters in Seattle and five from its base in Los Angeles, with varying degrees of competition. Overall Alaska continues to add routes where it can leverage points of strength to broaden its network utility.
Alaska continues to battle unit revenue pressure, a trend sweeping much of the US domestic market place. But it is still delivering top line profits, recording margin expansion and expanding shareholder returns in 2015.
Hawaiian Airlines is bracing for industry capacity increases on its North American routes during 2Q2015 ahead of the debut of new flights by Virgin America in 2H2015. At the same time the airline’s international routes are facing some pressure due to the elimination of fuel surcharges and currency fluctuations.
Despite those challenges Hawaiian maintains a bullish outlook for 2015 as it works to leverage its dominant position in the inter-island market and embarks on a course of de-levering its balance sheet now that it is taking a breather in aircraft deliveries and long-haul expansion.
After stating in late 2014 that it was examining various forms of capital allocation, Hawaiian has outlined a USD100 million share purchase programme now that it has achieved certain balance sheet targets, which provided the airline some flexibility to consider alternative uses of cash.