FL MORRIS / FMORRIS@STARBULLETIN.COM At the Aloha Air cargo terminal at Honolulu Airport yesterday afternoon, Duane Castellano, left, retrieved a shipment of leis that was dropped off earlier headed for Maui. Assisting him was Aloha employee Steven Kegley, right. Castellano works for Kamaaina Lei Greeters and Alii Leis.

Aloha leaves cargo in lurch

Businesses scramble to get perishable goods to market

Aloha Airlines abruptly shut down its cargo operations yesterday, leaving 85 percent of the state's air cargo in limbo and putting at least 400 employees out of work.

The company's cargo unit delivers such perishable goods as bread and bakery products, dairy products, fresh produce, fresh fish, newspapers and pharmaceutical supplies, as well as large items. All cargo flights were canceled last night.

In addition, the fate of 950 more workers depends on what happens to the company's aviation contract services unit, which provides such functions as ticketing, baggage handling and cleaning for other airlines. Those employees worked last night, but their status is uncertain since the unit's sale to Los Angeles-based Pacific Air Cargo has not closed yet.

Love's Bakery, which has shipped up to 36,000 pounds of goods per day on Aloha since 1985, hustled to get 22,000 pounds to the neighbor isles today using freight forwarder Surefire Consulting LLC, which flew two planes to Kauai and the Big Island via the mainland. "We were given absolutely no notification," said Mike Walters, Love's president.

Aloha has contracts to deliver the majority of the mail to Maui and the Big Island, but the U.S. Postal Service said it has made alternative plans with Corporate Air, which delivers mail to Kauai and other destinations. Still, officials said there remains a possibility of some delayed service.

The jolt by the bankrupt carrier came after two bidders for the profitable cargo operation dropped out and Aloha's lender, General Motors Acceptance Corp., declined to provide additional funding to finance ongoing operations. Aloha said it had no other choice than to convert its case to Chapter 7 liquidation from Chapter 11 reorganization.

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GEORGE F. LEE / GLEE@STARBULLETIN.COM After the abrupt shutdown of Aloha Air cargo, Love's Bakery employees scrambled last night at the company's Middle Street facility to adjust their distribution system to accommodate alternate routes to customers on neighbor islands. These pallets of bread were headed for Kauai.

From puppies to flowers to fruit and spare ribs, Aloha Airlines' abrupt shutdown of its cargo operations yesterday had some businesses scrambling for alternative ways to ship interisland.

Others, who had been bracing for the worst since Aloha filed for bankruptcy last month, already had contingency plans in place, but even they were left to deal with the added costs and inconvenience.

Love's Bakery, which has shipped up to 36,000 pounds of goods per day on Aloha since 1985, hustled to get 22,000 pounds to the neighbor islands today using freight forwarder Surefire Consulting LLC, which flew two planes to Kauai and the Big Island via the mainland.

"We were given absolutely no notification," said Mike Walters, president of Love's.

Fortunately for Love's, a spike in fuel surcharges by Aloha had prompted the bakery to start putting in place a contingency plan about six months ago, which required the company investing hundreds of thousands of dollars in new equipment to modify distribution, Walters said.

Love's began shipping to Maui via the Hawaii Superferry on Sunday. It also plans to use Young Bros. Ltd. barge service to ship to the other islands.

"It was a substantial investment for our customers on the neighbor islands, which represent 38 percent of our business," he said. "Cost is not a consideration right now as long as it gets to customers."

Other shippers, large and small, were not so lucky. Many were abruptly summoned to Honolulu Airport yesterday evening, then left scrambling to find another carrier.

Linda Billos had dropped off at 3 p.m. Jenna, a German Shepherd puppy destined for a family on Maui, and got the call at 4:50 p.m. to pick her up. She and her husband, Andy, a dog breeder, rushed back to get her.

"They're great," said Andy Billos. "We've shipped our many dogs, and we've dealt with Aloha for many, many years. It's too bad."

Billos said the pup will likely fly out on Hawaiian on Thursday.

Meanwhile, an American Airlines employee called an Aloha employee on his cell phone to find out if there was any way to ship a dog, who had flown from the mainland and was scheduled to fly on Aloha, to a neighbor island.

Or Pinkasorn was at the Aloha Cargo office trying to retrieve 10 boxes of orchid leis and flowers, originating from Thailand.

Her company, International Orchid, has been a customer of Aloha Cargo for 30 years because of the good service and "people are nice," she said.

"It's sad to hear," she said. "We send to almost every island."

Pam Lee, owner of Kalapana Farms on the Big Island, tried to get 400 pounds of fruit to Oahu yesterday evening, only to be turned away.

"I don't know what's going on with them," said Lee, who ships a few thousand pounds of fruit to Honolulu each week and will have to rush to Hawaiian Airlines or Young Bros. today to get her goods out on time. "I send out my fruits almost every day. It's going to affect my business for sure. It's going to be really, really bad."

Despite Aloha's recent troubles, managers at Onomea Orchards LLC were shocked by its sudden closure.

The 40-acre exotic-fruit orchard in Pepeekeo on the Big Island used Aloha cargo exclusively to get between 5,000 and 10,000 pounds of fruit a month between islands.

Aloha's closure will have widespread impact, especially for small mom-and-pop operations that have relied on the carrier for decades, said Manager Jeremy Lesch.

"It's going to change how we ship everything. We'll have to be a lot more regimented," Lesch said. "This is going to impact the fruit industry big time."

Pacific Floral Exchange Inc. in Keaau on the Big Island received notification of the closure yesterday by Aloha's cargo department. But the company had already had a contingency plan after Aloha pilots voted to authorize a strike last week, and was able to divert most of its freight to alternative carriers, said Grayson Inouye, company president.

The company began using United Airlines out of Kona and Hawaiian Airlines out of Hilo for about 70 percent of its business that goes through cargo, he said.

Still, the closure is going to add to the burden of running a small business.

"It's going to bother our business because we're going into our busiest weeks of the year, shipping for Mother's Day," Inouye said. "It does add an encumbrance to doing business."

And Roy's Waikoloa restaurant probably did not get its 60 pounds of pork spare ribs and two cases of ramen noodles last night.

"It's beyond everybody's control," said David Celades, a delivery driver for HFM Food Service.