PHOTO ILLUSTRATION BY BRYANT FUKUTOMI / BFUKUTOMI@STARBULLETIN.COM
Thinking globally
John Adams has a vision for
a much-expanded Hawaiian Airlines
that flies to the East Coast and Asia
When Hawaiian Airlines trustee Joshua Gotbaum unveiled his business outlook earlier this year to company creditors and union heads, he displayed a map with arrows pointing from Honolulu toward the mainland and Asia without any particular cities identified.
He has steadfastly declined to name any potential routes for competitive reasons.
But former Hawaiian Airlines Chief Executive John Adams, removed from office last May for alleged questionable financial decisions, offered a "vision" of what many of those nonstop routes could be this week when parent company Hawaiian Holdings Inc. filed its preliminary reorganization plan.
Adams, who remains chairman and CEO of Hawaiian Holdings and the controlling member of majority shareholder AIP LLC, said his vision includes flights to Atlanta, Boston, Chicago, Detroit, New York's John F. Kennedy International Airport, Philadelphia, St. Louis, Dulles (Washington) International Airport, Baltimore-Washington International Airport and Toronto, Canada.
Asian destinations that he said had been studied by his management team are Auckland, New Zealand; Hong Kong; Manila; Seoul; Shanghai, China; and Tokyo. Another city that had been on his list, Sydney, Australia, was announced as Hawaiian's newest nonstop destination earlier this year. Service is due to start May 18.
"During the course of the time I was the CEO, we had mapped out many prospective routes, including Sydney," Adams said this week. "We had talked about other routes, too. We studied them. We negotiated a transaction with a major carrier from the Far East, all of which was confidential. But when the company went into bankruptcy, it also was put on hold until we came out of bankruptcy."
Adams said that when the airline began transitioning to Boeing 767s from DC-10s in 2002, it literally opened up the world to Hawaiian. He said the reorganization plan that Hawaiian Holdings filed Monday offers the vision that he had two years ago for the airline's trans-Pacific expansion.
"The (reorganization) plan presents a vision, a vision that, by utilizing the long-haul capability of our airline, expands the markets into the heartland of the mainland and opens up new doorways to and from Asia," Adams said. "It makes Hawaii once again the doorway. It brings to full realization the business model, the vision, that we started at Hawaiian Airlines some two years ago."
Hawaiian's current longest nonstop flight is 5 hours and 40 minutes to Phoenix. That will change when it starts up its 10-hour, nonstop Sydney service.
GCW Consulting President Mo Garfinkle, a Hawaiian Holdings adviser and an industry analyst, said Hawaiian has been underusing its fleet.
"Our long-haul cost structure is very competitive," he said. "We also have some great upside productivity potential as we go more long haul. These airplanes today are flying distances (for Hawaiian) of five to 5 1/2 hours to the West Coast, (but) these plans can fly 9 1/2, 10 hours, and they do for most airlines. What we need to do is to take that asset, which today is underutilized for that long-haul mission, and use it for that long-haul mission, which is really the second phase of the vision that John and his management team had when they ordered those airplanes."
Gotbaum said he couldn't comment about whether Adams' proposed routes are the same ones he is looking at, but added that talking about expansion and implementing new routes are two distinctly different things.
"Figuring out whether or not a particular route makes sense for Hawaiian Airlines involves the labors of a number of people within Hawaiian, and it's a fairly serious task," Gotbaum said. "So my view is: 1) there is a world of difference in talking about we may expand to this place or that and doing the work necessary to expand; and 2) there is a world of difference in putting 15 destinations on a list and doing the analysis necessary to determine which of the 15 makes sense."
Adams and Garfinkle met with the Hawaii Tourism Authority on Wednesday to brief state agency officials on the reorganization plan. Frank Haas, HTA's director of tourism marketing, said the authority would welcome any plan that brings additional tourists to the state.
"Obviously, airlift is critical to the future of Hawaii tourism," he said. "What they are proposing develops new nonstop international routes and new long-haul nonstop domestic routes, both of which would be very beneficial to tourism here.
"They're proposing new routes to nonserviced or underserviced Asian or East Coast markets. In Asia and Australia, the development of those markets really depends on new nonstop airline service. There's also no nonstop service now to Hong Kong, Manila and Shanghai."
Haas said that in the domestic market, East Coast visitors similarly will be enticed to come to Hawaii by convenient air service. "We know from experience with other airlines that nonstop Hawaii routes do stimulate additional travel, and East Coast visitors will fill strategic objectives of attracting first-time and longer-staying visitors," Haas said.
Garfinkle said the fast-growing outbound travel markets in Asia make it an attractive place to touch down.
"These markets will continue to grow at great paces," Garfinkle said. "We need to participate in those markets ... By flying these airplanes to Asia, that's going to be a great benefit to Hawaiian and a great benefit to the economy of Hawaii."
BACK TO TOP |
Proposed destinations
Hawaiian Airlines would be a more global carrier in John Adams' vision for the company:
East Coast
St. Louis
Chicago
Detroit
Toronto
Atlanta
Washington, D.C.
Philadelphia
New York
BostonAsia-Pacific
Tokyo
Seoul
Shanghai
Hong Kong
Manila
Sydney
Auckland
Notes
>> Hawaiian flies its 767s less than six hours on its longest trips even though the aircraft can fly routes of 10 hours.
>> The airline plans to launch service from Sydney, Australia, on May 18.
