FL MORRIS / FMORRIS@STARBULLETIN.COM / JULY 2002
The state's two airlines, Aloha and Hawaiian, yesterday formally filed an application with the U.S. Department of Transportation to be exempted from antitrust regulations so they can coordinate seat capacity for interisland service.
Hawaiian and Aloha airlines yesterday formally applied to the U.S. Transportation Department for permission to coordinate flight and seat capacity on routes in Hawaii so they can reduce costs and try to stem losses. Aloha and Hawaiian
file for exemption
The 2 carriers will coordinate
capacity for interisland serviceStar-Bulletin staff and wire
The carriers said in a joint filing yesterday that they are seeking antitrust immunity to set capacity jointly on the five biggest interisland markets, with each carrier providing half of the service. The carriers want immunity to run through Oct. 1, 2003.
Both airlines declined comment and copies of the filing were not immediately available in Hawaii. However, a source close to the situation said the plan calls for each airline to decide what it expects it will need in interisland seat capacity for each coming month and then those totals will be combined and then divided in half.
It will be up to each airline then to decide how much of its 50 percent share it will use, the source said.
The Aviation and Transportation Security Act passed by Congress and President Bush after the Sept. 11 attacks allows the department to approve such agreements if the governor of the state agrees. Gov. Ben Cayetano gave his approval July 22, the airlines said. Ticket sales and fares have declined for the industry since the attacks.
"Interisland services have been unprofitable for each of Hawaiian and Aloha for a period of several years, well before the tragic events" of Sept. 11, the airlines said in the filing. Since then, "traffic levels have dramatically declined, and even with the carriers' implementation of unilateral capacity reductions, interisland financial losses have continued."
The immunity would help the airlines preserve interisland service and save money on fuel expenses, landing fees and maintenance costs, the carriers said in the filing.
The carriers said they would not coordinate route schedules or fares and that they would continue to serve current markets.
