Hawaii weighs impact of a mixed bag of airlift news

By Shane Nelson
InsightFollowing a week of both positive and negative airlift news for the Aloha State’s tourism industry, I spoke with David Uchiyama, the vice president of brand management for the Hawaii Tourism Authority (HTA), to get a better sense of how the service reductions and announcements of new international and domestic lift might impact the destination moving forward.

In Chicago for a meeting with United Airlines representatives, Uchiyama told me via phone that he was certainly concerned about the carrier’s recent decision to reduce service between Washington Dulles Airport and Honolulu, launched last June, and that the company was also looking closely at the numbers on its daily Los Angeles-to-Hilo flight.

“Anytime you start a new route, it takes a while, and [United] understands that; it’s just a matter of how much risk are they willing to take,” Uchiyama said of the airline’s Dulles-Honolulu segment, noting that theShaneNelson company was open to re-evaluating service on the route should demand improve.

“If we can build demand, they may change the frequency before the holiday high season,” he continued, adding that the HTA will explore several marketing options to bolster interest from the D.C. market. “Ultimately, we really want to have consistency on that route.”

The news that Allegiant Airlines plans to suspend service on seven of the 10 flights it is operating between the U.S. West Coast and Hawaii after Aug. 14 seemed less worrisome.

“I don’t look at it as bad news,” Uchiyama said. “They really went into second- and third-tier markets that nobody would have gone into and tested them, and I think they are going to come away with some that will do well for them.”

Referring directly to Allegiant’s nonstop flights from Bellingham, Wash., to both Maui and Honolulu, along with the carrier’s Honolulu-Las Vegas nonstop, as routes that were likely to continue, Uchiyama said suspending those that were underperforming would enable Allegiant to try other options.

“When you have a carrier that’s willing to kind of probe at drawing from new origination points off the West Coast, that is a really good opportunity for a destination,” he said.

Virgin Atlantic’s announcement that it hopes to begin flights to Hawaii in 2015 wasn’t a surprise to Uchiyama, who said the HTA had been talking with the carrier for a couple of years about entering the Hawaii market after it secured aircraft capable of transpacific flights. And according to Uchiyama, there are several other domestic carriers seriously considering the launch of flights from the U.S. mainland to Hawaii in coming years.

“Everybody is trying to connect East to West,” he said. “And when I say East to West, I mean all the way to Hawaii.”

Asked about the range of new international flights to Hawaii from Asia and Oceania, including Hawaiian Airlines’ recent announcement of its intent to offer flights from Honolulu to Beijing beginning in 2014, Uchiyama said international seats to Hawaii grew 24% in 2012 and were already up 11% thus far in 2013 and noted that the HTA had also been in discussions with several Chinese carriers about opening service to Oahu from Beijing.

“Hainan already has approval on that route,” he said. “China Eastern was in the process of asking for approval on that route, so it will be interesting, and we’ve been talking with Air China for quite a while.”

Uchiyama said that in addition to growth from overseas markets he believes there’s still opportunity for more seats from the U.S. mainland, mentioning Alaska Airlines as a good example.

“If you look at Alaska from 2010 to 2012, there was substantial growth there,” he said. “And I think there is potential for them to grow further.”

According to the latest HTA statistics, the number of domestic seats arriving to Hawaii on nonstop flights from the U.S. mainland increased 4.9% year over year in 2012 and were up 9.9% year to date through February.

 
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