Hawaiian Airlines, which already holds about 90 percent of the interisland passenger market, is expanding its cargo presence in the islands.
The state’s largest carrier said Tuesday it plans to purchase three ATR 72 turboprop aircraft in an all-cargo configuration to bolster its interisland shipping service. The new operation will begin in the first half of 2016 and initially fly between Honolulu and Kahului, Lihue, Kona and Hilo. It will be part of the company’s ’Ohana by Hawaiian division and will be operated by Idaho-based Empires Airlines, which runs Hawaiian’s 48-passenger ATR 42 turboprop service that began in March 2014.
Hawaiian said the new cargo service will create more than 100 new Hawaii-based jobs, including pilots, mechanics, ground handlers, sales, customer service and management positions.
“Since launching the ‘Ohana by Hawaiian passenger operation … we have established a track record of providing a reliable and efficient service for travel within the islands with an on-time arrival rate of 94 percent,” said Hadden Watt, managing director of ‘Ohana. “We expect to deliver the same reliability and high quality of service to our cargo customers for their interisland shipments.”
Hawaiian has been putting more focus on its cargo operations recently and has seen its cargo revenue grow 103 percent over the past three years, with the highest year-over-year quarter growth being 56 percent and the lowest quarterly growth being 20 percent during that time. In 2014, Hawaiian generated $77 million in cargo revenue, up $13.1 million from $64 million in 2013.
The airline generates 92 percent of its cargo business from the mainland or international points of origin using containers that are placed in the holds of its Airbus A330 and Boeing 767 aircraft. Hawaiian’s Boeing 717 aircraft, which are used for interisland routes, can accommodate only loose shipments.
The ATR 72s, which will be the first dedicated cargo aircraft in Hawaiian’s current 54-aircraft fleet, will be able to carry up to 18,000 pounds of cargo and handle five 88-by-108-inch aircraft pallets or up to seven LD3 containers, skidded cargo and oversize shipments. Express services for smaller shipments also will be available on Hawaiian’s 160 daily Boeing 717 flights throughout the day.
“Our customers have asked for a single-provider solution for movement to all major destinations within the state of Hawaii,” said Tim Strauss, Hawaiian’s vice president of cargo sales and services. “Our ability to handle interisland containerized and palletized cargo will provide greater flexibility for our customers seeking seamless connections from our long-haul flights, and it will help grow our business on both our wide-body and B717 services.”
Hawaiian’s cargo expansion undoubtedly will put pressure on Aloha Air Cargo and, in some ways, rekindle the former rivalry that existed when Hawaiian and Aloha were the two dominant interisland carriers until Aloha ceased passenger operations March 31, 2008. Following that shutdown, Aloha Airlines, with the help of U.S. Sen. Daniel Inouye, sold its profitable cargo division through federal Bankruptcy Court to Seattle-based Saltchuk Resources Inc., which also owns interisland ocean shipper Young Brothers Ltd. and Hawaiian Tug & Barge.
Aloha Air Cargo has a fleet of three 737-200 freighters, one Boeing 737-300 freighter and three Saab 340A turboprops that collectively have a payload capacity close to 150,000 pounds, according to its website.
Hawaiian, which has 6 percent of the interisland cargo market now, also competes against TransAir, Corporate Air and Kamaka Air.
