Saturday, July 13, 2013

Aloha: Manila Bids Farewell to Hawaiian Airlines

Last April, Honolulu-based Hawaiian Airlines announced that it would be discontinuing its non-stop service to Manila due to poor performance.

hawaiian airlines philippines
Copyright Photo: Kit Stephen Agad/PPSG

In a statement, Peter Ingram, Chief Commercial Officer, stated that the under-performing route was plagued by high fuel prices and low fares. The airline struggled to compete with Philippine Airlines that enjoys a significantly lower labour cost benefit on the route.

"While we have made several efforts to improve the economic performance of our Manila service, including adjusting our flight schedule to optimize connections and upgrading to our newer A330 aircraft, we've concluded that the route will not be a commercial success," said Ingram.

Hawaiian Airlines began serving Manila in April of 2008 with services four times per week direct to Honolulu. The airline said that reservations would continue for seats available up until the final flight but for passengers booked on flights after August 1, passengers would be accommodated by other carriers. The final flight from Honolulu to Manila is scheduled for July 31, 2013 while the final Manila to Honolulu trip will fly on August 1. The final flight will be operated by one of the airline's Boeing 767 aircraft.

Meanwhile, in spite of the airline's decision to pull out of Manila, the US Department of Transportation has renewed the permit of Hawaiian Airlines to fly to the Philippines. The agency reports that it granted the application of Hawaiian Airlines to renew its permit to fly to the Philippines up until May 21, 2015. In addition to requiring the permit to continue flying the route up until July 31, as the old permit expired on July 11, the airline stated in its application that it would like to maintain the regulatory flexibility to provide service to the Philippines should market conditions and demand make it more profitable.

With the country's growing status as a tourism destination, an increase in demand is quite likely. In addition, the pending lifting from Category 2 status would enable Cebu Pacific to fulfil its desire to serve the Hawaiian market which would stimulate airfares and increase demand between Hawaii and the Philippines. However, with fares anticipated to lower with Cebu Pacific's possible entry along with fierce competition from Philippine Airlines and the lower labour cost benefit of Philippine carriers, it is unlikely that Hawaiian will be able to reach the performance objectives it desires any time soon.

1 comments :

  1. Sad to see HA leave the Philippines. Many of my Hawaiian friends and I feel like an important link has been lost. I always wondered why the mainland connection market was not more aggressively marketed. I think many Filipino communities in places like SAN, PDX, SEA, LAS, and JFK could have found the one-stop service convenient and pleasant. it is in this non-gateway (LAX and SFO) arena that I think HA could have competed effectively with PR an 5J. Come back, HA!

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