The airline is gearing up for the delivery of its initial two Airbus A321neos, scheduled for October and November, the first of 18 A321neos the carrier plans to receive through 2020.
“It allows us to begin our plans to transform our service between Hawaii and the US west coast [and earlier this week] we announced the first route extensions associated with the arrival of our first neos,” Hawaiian Airlines CEO Mark Dunkerley said.
“The A321neos will provide us with a combination of growth and replacement, enabling the retirement of the remainder of our [Boeing] 767 fleet by the end of 2018 and capitalizing on our … unit revenue performance between the west coast and Hawaii,” Hawaiian EVP and CCO Peter Ingram said. “The smaller gauge and next generation economics of these aircraft make them ideal for the routes we fly with wide-bodies today.”
Ingram elaborated on route expansions announced July 24. “Starting in January 2018 we will be introducing new nonstop service between Portland and Maui, taking advantage of the arrival of our first A321neo,” Ingram said, adding an extension of seasonal service between Los Angles and Kona will go year-round beginning in March, “first with our 767s and later with the A321neos.” Additionally, the carrier’s seasonal Oakland to Kaua’i service will transition to year-round nonstop service in April 2018, also utilizing a new A321neo. Hawaiian’s Oakland-Maui service will switch over from its existing wide-body aircraft to A321neo in January, Ingram said.
“While delays of the delivery of the first units of this type have been extremely disappointing, we remain committed to the A321neo as it is the aircraft optimally configured for service between Hawaii and the mainland,” Dunkerley said.
Dunkerley also addressed increased competition and capacity scheduled for the coming peak winter-travel season, courtesy of United Airlines’ recently announced expansion of nonstop Hawaii service from its Chicago, Denver and west coast hubs, set to begin Dec. 20.
“Total industry capacity [between North America and] Hawaii has ebbed and flowed over the 15 years that I’ve led Hawaiian. The North America to Hawaii capacity growth scheduled for next year, while more than we’ve seen over the past 18 months, is not, in fact, unprecedented,” Dunkerley said.
“Our perspective on this [is] … no airline is better positioned to serve Hawaii than Hawaiian,” Dunkerley said. “We have studiously diversified our business, precisely to make sure short-term conditions in one of our geographies do not overwhelm our overall performance … we have a number of capabilities that will mitigate the impact of rising industry capacity -- aircraft better suited to the markets we serve, product improvements already delivered and on the way, … organizational strengthening, [these] will all help. None of these were at hand the last time industry capacity increased markedly a few years ago.”
Hawaiian’s second-quarter revenue increased 13.6% year-over-year (YOY) to $675.3 million, outpacing expenses, which grew 13.2% YOY to $532.8 million during the quarter. Operating profit came to $142.6 million, up 15% from a year ago.
Fuel expenses for the quarter increased 22.6% to $102.8 million, compared to $83.8 million in 2Q 2016.
Hawaiian’s passenger traffic increased 6.6% during the quarter to 4.1 billion RPMs, as capacity grew 4.1% to 4.7billion ASMs, resulting in a passenger load factor of 86.6%, up 2.1 points YOY.
Yield increased 7.3% YOY to 14.47 cents. PRASM was up 10% YOY to 12.53 cents. CASM ex-fuel was up 5.6% to 8.98 cents.
(Mark Nensel - ATWOnline News)