Editorials

[ OUR OPINION ]

Airlines’ short-term
exemption makes
long-term sense

THE ISSUE The interisland airlines are asking the federal government to allow them temporarily to coordinate flight capacities.

THE federal anti-trust exemption that Hawaii's interisland airlines are requesting could help stabilize the operations of both companies to keep them financially afloat. Although the exemption likely would result in fewer flights, having two healthy airlines flying Hawaii skies would benefit the consumer in the long run.

Because there are enough safeguards in place to prevent unwarranted fare increases and loss of service, the federal government should approve the airlines' proposal.

The exemption, part of the Aviation and Transportation Security Act passed after Sept. 11, would allow Hawaiian and Aloha to review the capacities of flights and the number of seats being offered to gauge how many can be cut. The airlines then would split the number of seats evenly and keep tabs on sales to make sure profits also are equal. It would save them fuel costs, landing fees and maintenance expenses.

As the airlines now operate, they often have service on the same routes departing within minutes of each other with empty seats on both aircraft. In the past, neither has wanted to cut service for fear of losing business to the other.

The interisland market had been unprofitable for both airlines for years before Sept. 11, but the terrorists attacks further exacerbated the situation, and the airlines — citing a steep drop in passengers — attempted a merger. In the wake of that failure, the airlines have decided to take advantage of the exemption offered in the security act.

The exemption would be temporary, only until Oct. 1, 2003. The airlines would not be allowed to coordinate flight schedules or fares. Operations would be subject to review by the state to assure they are not unreasonably restricting air travel and are in the best interest of Hawaii consumers. Gov. Ben Cayetano, whose approval of the agreement was necessary, can withdraw his consent at any time. The airlines also cannot eliminate service to their five largest markets — Lihue, Kahului, Kona, Hilo and Honolulu.

The cooperative effort may move each airline toward streamlining service down the line and to evaluate needed capacity without worry about losing passengers to the other. This time-out from full competition eventually could help Aloha and Hawaiian determine how to make reasonable profits and stay in business. When they return to the competitive market, both may emerge stronger financially, which would be to the consumers' advantage.

The exemption requires the approval of the U.S. Department of Transportation. Secretary Norman Mineta should move quickly to clear the request.

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Published by Oahu Publications Inc., a subsidiary of Black Press.

Don Kendall, Publisher

Frank Bridgewater, Editor 529-4791; fbridgewater@starbulletin.com
Michael Rovner, Assistant Editor 529-4768; mrovner@starbulletin.com
Lucy Young-Oda, Assistant Editor 529-4762; lyoungoda@starbulletin.com

Mary Poole, Editorial Page Editor, 529-4790; mpoole@starbulletin.com
John Flanagan, Contributing Editor 294-3533; jflanagan@starbulletin.com

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