[ OUR OPINION ]
THE ill-fated merger of Hawaii's airlines has spurred both companies to new levels of competition. An expansion of their markets could help invigorate the state's tourism industry while giving local customers more travel options. Hawaii’s airlines rev
up their engines
THE ISSUE
Aloha and Hawaiian take wing on new routes after the failure of a merger.
The renewed rivalry may yet be a prelude to the eventual failure of one or the other if either stretches resources too thin. However, it is encouraging to see the companies refreshing their forces.
For the employees the airlines furloughed when business dropped off after Sept. 11, the revived competition means they will be rehired. Getting people back to work channels wages into the state's economy and with Hawaii's gloomy economic scene, every bit of good news brightens the outlook.
Aloha Airlines this week announced two new routes -- one to Burbank, Calif., and another to Vancouver, Canada -- pushing ahead on its plans to convey that the company "is alive and well," says Glenn R. Zander, its president and CEO. With growth in the interisland market topping off, Aloha sees room for expansion in North America. Hawaiian Airlines has similar ideas, last month announcing service from Honolulu to two California cities and starting direct flights between Maui and Seattle. Hawaiian also plans direct Maui service to either San Francisco or Los Angeles in June.
The merger was proposed after the terrorist attacks sent air travel into a tailspin. The airlines had already been winging through turbulent financial skies and both had said the merger was the only way to fly. Zander says Aloha still believes that a combined airline would have grown faster, but has since reworked its loans and improved its stability.
The airlines have yet to take advantage of a special antitrust exemption that would allow them to collaborate on flight schedules and routes, nor have they sought available government loan guarantees. If these can strengthen their financial health, the companies should consider them.
The optimism and determination Hawaiian and Aloha are displaying as they search for and take hold of profitable routes impart confidence that both could succeed, a turnabout from predictions of failure during merger discussions. Profit margins, if any, likely will be thin, but if growth is carefully charted perhaps both can carve out enough to keep them going. Hawaii and its people, so dependent on reliable air service and the tourism industry, should be rooting for them.
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