Island Air backs out of Midwest

Interisland carrier Island Air said yesterday it has backed out of a contract to operate commuter flights to four mainland communities from Kansas City International Airport in Missouri.

Rising fuel costs and employee training would delay startup of the Essential Air Service flights beyond a deadline of mid-September, Chief Operating Officer Les Murashige said in a statement.

"Island Air still hopes to have other opportunities to bid for an EAS contract but for now we will focus on our local market," he said.

Island Air, which had bid for seven cities in March, was notified in early May that it won a two-year multimillion-dollar contract to take over Essential Air Service routes to Grand Island, Neb.; Joplin, Mo.; and both Harrison and Hot Springs in Arkansas.

EAS is a federal program designed to guarantee commercial service to small communities.

The airline's decision to drop the bid also was influenced by the shutdown of Aloha Airlines passenger operations on April 1, Murashige said.

"Since then, we have been carefully reviewing operational logistics and the changes in the Hawaii market," he said.

Island Air would have flown 37-seat de Havilland Dash-8s, the same type of aircraft it uses for its interisland service, on the EAS routes. The airline had said none of the six aircraft in its Hawaii fleet would have been used.

Mesa Air Group Inc. subsidiary Air Midwest will stop flying to those cities under US Airways Express and Midwest Airlines on June 30, citing significant losses and little prospect of future profitability. Mesa is the parent company of interisland carrier go!