$19 fares give go! record sales
Go!, which shook up the interisland market again on Friday by lowering its one-way airfares from $28 to $19, said yesterday that the first day of sales generated nearly 10,000 bookings -- about five times its normal level and a single-day record since go! started flying on June 9.
Hawaiian Airlines, which matched the $19 fare, wouldn't disclose any specifics but noted that "our phones have been busy." Aloha Airlines declined to comment on its booking activity.
The $19 fares, which must be purchased by midnight Saturday, are good for travel through Feb. 28 between Honolulu and Lihue, Kauai; Kahului, Maui; and Hilo and Kona on the Big Island.
Go! was blasted last week by the chief executives of local carriers Hawaiian and Aloha for offering the low fares.
Jonathan Ornstein, chairman and CEO of go! parent Mesa Air Group, said yesterday he wanted to "apologize to our competitors who are clearly very upset with our low fares."
"Possibly the most successful airline in the world (Ireland-based Ryanair) gives away over 20 percent of its seats for free and is highly profitable because of its low costs and complementary income sources," Ornstein said. "We are emulating this model with go! and will continue to be Hawaii's low-fare leader."
Ryanair, which is Europe's biggest discount airline, plans to give away about 40 percent of its seats this year, Ryanair CEO Michael O'Leary said yesterday, according to Bloomberg News. Ryanair gave away about 35 percent of its seats last year, Bloomberg reported.
The no-frills carrier makes its money in several ways, and uses its high passenger traffic to generate income. Ryanair earns a percentage of the sale when customers book a hotel or tour, or rent a car. It also charges for amenities such as food and beverages. And it charges for checked luggage to encourage passengers to carry their bags on board to reduce aircraft turnaround times. Finally, Ryanair builds loyalty through its frequent-flier program.
"If we can build our Web site the way Ryanair built their Web site, and they can give away 25 percent of their tickets because they get their revenue from other sources, we can (offer low fares) for a very long time, forever, because Hawaii is a perfect place to do it," Ornstein said. "They're the most profitable airline in the world because they're driving people to their Web site to purchase goods and services.
"The CEO of Ryanair is a good friend of mine and he envisions the day where all tickets are free. Hopefully, one day I'll be able to offer the same thing."