Southwest Hawaii. How’s it going now? “The other airlines can’t touch you… Predatory and opportunistic—which we like.” — SW and SWAPO
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160 thoughts on “Go Big and Predatory: Southwest Hawaii And Costco”
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Costco has a set cost plus system of about 12%. It is totally unfair to put them in the same boat as Southwest. And it is a member system – you pay for the lower prices.I pay about a dollar under at Maui Oil – and its even less than Costco.
And I Do remember the mom and pop that used to have to charge 3 times the mainland prices for things because they didn’t have volume and it was totally expensive. So I for one am very happy Costco is here.
Costco is the only reason gas prices in Hawaii aren’t 8.00 a gallon right now. Those weren’t mom and pop gas stations gauging us it was Shell and Chevron! People are quick to forget but I remember when gas prices were $2 more a gallon than the mainland
I’m actually glad to see Southwest Hawaii here. I was actually one of the first Hawaii residents to fly Southwest inter island when they arrived and have been a loyal passenger since! Their prices then were slightly higher than what they are advertising now through till the end of this 2022 year! No matter what SWA was advertising as their fare at the time it was and still is way less than HA. As was stated Hawaiian Airlines had the monopoly over the State of Hawaii for years and were charging astronomical fares just to fly inter island. With the entry of a larger airline company with deeper pockets is giving HA a run for their money. It’s about time HA has some inter island competition!
Naaah, the Costco/SWA comparison analogy doesn’t really hold sway with me. First of all, Costco’s business model success is based primarily on membership sales. SWA would have to start selling memberships AND lower fares across the board for you to compare apples with apples. As far as eliminating local competition and then raising prices back up, I can’t really say that Costco does that because their major competition in both the retail and the online space is always fierce and ever-present, particularly with Walmart in the #1 retail slot. In addition, Costco will hold the price line on its $1.50 hot dog and soft drink as well as its $4.99 rotisserie chicken. Those two items are serious loss leaders and big wins for the consumer.
Aloha, can we stick to the facts please? Regarding Costco, Gas in Kapolei is $4.59 at COS. The nearest 3 gas stations sell regular at $4.99. Conversely, Hawaii Kai where Costco for some reason is’nt allowed gas pumps the two stations listed on gas buddy are $5.36 & 5.49 respectively. SWA is a great American success story. Braniff and Eastern Airlines (remember them) teamed up with “representative” Jim Wright to kill Southwest invitro. SWA, through sheer grit persevered, and they are “the world’s most loved, most flown, and most profitable airline”. google “the SW effect”. Fares drop between 30 and 80% with SWA’s Arrival in a market! Calling SWA “predatory” is absurd. Competition is great for all Hawaiian’s & don’t forget, bags fly free!
When Aloha airlines ceased operation Hawaiian airline was the only game in town. They were ruthless and unforgiving and jacked prices out of sight. Southwest was exactly what the interisland market needs.
I think that it’s been nice to finally be able to afford a flight to the other islands. If they can’t keep the prices low on large aircraft, Why can’t they offer smaller turboprop planes? There must be other options available.
Thank you for actually pointing out these cheap fares are unrealistic. Look at the cost of similar length flights on mainland operated by SWA, they’re not nearly as cheap. People keep complaining about HA price gouging but up until SWA came along, I could find HNL-OGG for $130 and the like, if I booked out far enough. Of course prices go up the longer you wait to book. In the same breath people lament the loss of Aloha airlines and the thousands of local jobs when Go Airlines did something similar as SWA. Then people go on to complain about lack of local jobs and companies. Unlike Costco, SWA has no need to hire many local workers at all. That’s local money leaving our economy.
During the pandemic when all the airlines stopped flying to/in Hawaii, I appreciated that Southwest was still flying. I would not have been able to go back and forth for my assignment if they had not been so committed to remain in Hawaii.
Just like all other mainland companies, they’re gonna come in and steam roll the local businesses. Idk about you guys and your need for a $29 fare but I understand flying jets is expensive. Once Hawaiian goes out of business, Southwest gonna jack up prices and all your aunties uncles and cousins gonna be jobless.I vote for the local brand. Only one carrier flying the Hawaiian flag on their birds and doing the announcements in Hawaiian.
Hawaiian was doing the same exact thing. I remember it costed $500 for a interisland flight from oahu to kona round trip. Can you tell me why the evil empire is any better? That and they hired only within. Yes being local is a bit bias.
I remember when Hawaiian airlines was our only choice to go Oahu or Big island. $200 one way , granted it was holiday season, but still $150 average one way ticket the rest of the year. They gouged us local people for a long time. I’m going to Kauai next weekend on southwest for $89 round trip. Thank you for reminding me, I have to go pick up a rotisserie chicken from Costco. Blessings to all
Post Covid Southwest double down on Hawaii Mainland service with a slew of new flights. Demand skyrocketed to Hawaii. Unfortunately the entire hospitality couldn’t keep pace with the demand and the Hawaii government officials begged and pleaded with All the airlines to throttle back service levels to ease the over congestion on local facilities throughout the islands.
In the same breath local business leaders told SW while they love their inter island service to help bring fares down from a historical high prices Hawaiian was charging with its monopoly.
But they HATED the slim inter island flight schedule SW was flying and asked for more flights to make it a solid option when doing a inter island business day trip.
“They’ve said their current focus is on convincing Hawaii residents to move from Hawaiian to Southwest for interisland flights.”
As a person that has flown on Southwest interisland a couple of times, I would say that the option to fly them is gaining ground. On a flight to Maui, at 6 a.m. departure, both the Lt. governor, a Congressional candidate, and current legislator, along with their staff, were on that flight. If there was a “locals only” philosophy for interisland flights, it is not be set in stone with the fact that now even our government officials are using Southwest service. It might not be a total switch, but it’s notable nonetheless.
The government has to use the lowest cost flight even if it means flying SWA. Tax dollars are paying for it, and the constituents made it law when they voted.
It Sucks that companies like SWA and Costco are predatory. It’s ok to undercut to win but if they were a lender, they would be breaking the law. For every mom and pop shop and every local job they steal, the local economy looses 10-15 more jobs.
I flew SW last week for $260 rt. Flight there had 30 open seats on a Tuesday and return had 70 seats open on a Wednesday.
I flew Southwest 2 weeks ago to Oahu for $356 RT and it’s great compared to Hawaiian air for $600..with 2 free luggage 🧳 on the side its perfect. From now on I’ll be flying southwest to my fave tropical destination.
I think southwest is great for all the islands. Hawaiian only is a monopoly. I’ve been flying Hawaiian my whole life & am dissapointed on there pricing. As soon as Southwest came to the islands I have been flying with them 90% of the time and Hawaiian 10%. The only thing that Southwest is lacking is local flight attendants & agents. Believe me we the local community’s have been discussing the same thing. And everyone, I mean everyone we talk to say the same. Thats the only thing lacking, if Southwest wants to beat Hawaiian in the long run thats what they need to do. I am born & raised here in Hawaii these things I have suggestes with lots of Aloha would make the differnce for Southwest to surpass Hawaiian as the leader in all of Hawaii.ALOHA
I shop Costco in California and when I come to Hawaii. We tend to buy like items in both places and we and the rest of the visitors would know if Costco was price gouging. They do tack on the extra freight and handling ( you can thank the Jones Act for that and your editors know this). I don’t see the article picking on Home Depot, Lowes or Walmart and Target. The Islands are an expensive place to live but why erroneously blame these retailers. In fact gas is cheaper at Costco on the big island than it is in my hometown Costco. The explanation is simple based on California Air Quality regulations. Get honest with your readers, they aren’t all as dumb as you think.
Spot on Barry! All the local politicians claim to care about their constituents while taking union money and keeping the Jones act and monopolies like Young Brothers intact. Shame on them! Southwest has never laid off an employee in 55 years. Talk to their local hires and you will find some very happy people. The Islands could need honest leaders and more great companies like Southwest Airlines!
Hawaiian has had a monopoly.
Competition is good.
The competition is good for the people and businesses of Hawaii.
Hawaiian is the one that made fares between the islands more then fares to the mainland and held the prices there for a long time. Yay, lets support more competition.
The SWA pilots union is good example of why many people in Hawaii have a problem with the arrogance of those that come to Hawaii with a sense of entitlement and complete disregard for anyone but themselves. SWA views Hawaii as somewhere they can pick apart for their own corporate profits back in Texas, with no regard for the impact on the islands.
My fav is Hawaiian. Having said that, Low cost airlines are always getting dumped on but the fact is the consumer needs choices & SWA offers that. Our #1 w/in Mainland isSWA as much as possible if the fare is right (I also have points) Prior to SWA adding Hawaii to their destinations I have always preferred to fly Hawaiian for my Hawaii trips. Thought once SWA opened up we’d fly them more to HI but generally the flight times aren’t the greatest for us. We did fly to HI 1x on SWA & it was just fine,We bought Early Bird & got the seats we wanted. Brought food with us (although they may have had something more substantial to serve because of the length of flight) and used their app for in-flight entertainment We’d do it again if we had to.
I hope that SWA begins to hire locally, and I believe they will have no choice as they increase the number of destinations and frequency of flights. I can’t help but point out that when I flew inter-island with my niece this past spring, the total was less than $157.00 round trip from HNL to KON for both of us … and 4 checked bags and a carry-on for each of us. Airfare alone on Hawaiian Airlines for the 2 of us, round trip with a similar itinerary would have been $480.00. Both flights were filled (137 passengers plus crew).
Calling a free msrket “predatory” is a big stretch without providing proof of intent to defraud. Whether we like it or not what we are witnessing is a free market economy. Just because several new vendors (airlines and retail stores) entered the Hawaii msrket is not a negative in a free market. What is really happening is a normalization in the marketplace as more vendors bring prices that represent competitive choice. Jim E
If the article is supposed to make me feel sorry for Hawaiian because they are perceived as local, my memory of how they crushed competition and eventually put out of business Aloha, Mahalo, the ferries and others over the years. I want to buy a couple of these cheap tickets so I can visit some of the neighbor islands that have been prohibitively expensive for some time.
Do it quickly because these prices will change.
If a competitor has prices you can’t match, you have choices. Sell your product or service where competition is not as strong, is one approach. Given the huge capital investment facing airlines and the availability of gates that might not be so easy.
So, make your product more compelling. Instead of competing on price, compete on service. Works for Qatar and Emirates, among others. But, Hawaiian seems to have tunnel vision based on price. Hawaiian can’t win a price war.
This is called business n serving the inter island people so they can visit family on different islands.
I think southwest will not last. Hawaiian will stick to their own.
I always fly Hawaiian. If you can fly on the days when the rates are lower they compare favorably to Southwest. Hawaiian fly wide body planes which we prefer when they are available. Extra comfort seats on the wide body on either side of the plane are preferable to the southwest 737 seat configuration.
Gasoline is cheaper at Costco in Maui than in California. I don’t agree that they drove out the competition then raised up the prices. Inflation raised the prices.
We have Walmart and Target for comparison, and Costco is still cheaper on most consumer goods.
Hawaiian was gouging us before SW got into the inter-island game. The problem with SW is plane availability. One delay anywhere screws up the whole system.
Your description of the destruction of the market is much closer to Walmart’s demonstrated tactics than Costco’s.
This has been a long established airline practice and their established kings are Alaskan and Hawaiian. RIP Aloha and others. Welcome Southwest. I am a regular Kauai to Oaho flyer (I’d rather use the superferry.) and I appreciate that thing we refer to as competition.
I don’t like the term “predatory” – it’s just good business.
I applaud SWA entry into the Hawaii market. Hawaiian Airlines has been gouging the citizens of Hawaii for years with no competition after putting Aloha Mahalo Go and other airlines out of business by undercutting fares. Now their getting a taste of their own medicine. I only fly SWA now & say good riddance to HA’s exorbitant fares & excessive baggage fees. Long live Southwest Airlines!
Mahalo Beat of Hawaii. Love your informative and thought provoking articles!!
In my oh so humble opinion, I consider Southwest airlines as the “Cattle Car” of airline transportation.
Personally, I’d rather swim from the island to the mainland.
Stay safe and blessed! Aloha 🌺
Hi Pam.
Thanks. Have a great weekend!
Aloha.
It didn’t used to be allowed, because its society destroying. But, we are living in different times. We have evolved into something I don’t recognize.
I feel like the comparison to Costco is unfounded in many ways. I have been in management at Costco for almost 20 years. Not once have I ever attended a meeting at the corporate offices in Washington and heard the CEO, VPs or any other person say or do a single predatory comment or model. 70+% percent of our margins are from memberships and there is a maximum margin on any product that is under 20%.
When Jim Sinegal (and now Craig Jelinek) walk buildings they constantly challenge buyers to increase quality at a better retail price.
Most buildings have 300-500 employees All making $15-30+/hr with amazing benefits adding about 40% to their wage package. Even part-timers! Every building is required to have 51% or more FT employees.
This poor article mentioning Costco is disgusting. Try inserting Walmart instead!
I love Costco! I trust Costco to give me the best price they can on quality goods When I’m in Costcos in Hawaii I find many items are priced the same as mainland prices
Competition is good!
I worked hard for months to earn the Fee Companion Pass on Southwest because I fly LAX to LIH (Kauai) all the time. Then they pulled the plot. I am so disappointed in Southwest!!
Just because you can get a non-stop to LIH you are disappointed? They can’t change their schedule? You can still get to LIH, you just have to add a stop. The CP is so much better than anything out there. Even with a stop.
We are devotedly loyal to Hawaiian Air! We fly SW a lot here locally as they are the major carrier for the southwest part of the country. To think about sitting in a SW seat for 6-7 hours not having been able to choose that seat anyway – Ugh! If that is the only way you can afford to go to Hawaii for that one time in your life – SW is the way to go. But personally, I would rather skip a trip than give up 11A/B or 11H/J (or any other seat on Hawaiian! Plus the schedule is awful. But again, to discourage someone from the once in a lifetime experience of Paradise – no way.
Maybe they can have alternatives like I dunno a superferry. Oh wait that’s right 2 percent of the population funded by the rental car companies, Manson and other businesses hired people to protest and the clueless let it get cancelled. So stop whining.
You should thank yourself lucky Costco is there other wise you’d all be starving. Costcos business model is the same everywhere they don’t gouge. I lived in Maui it took almost 10 years to approve the gas station because all the families who have a monopoly on business there kept blocking it.
Tell it like it is!
There’s way more Walmart stores (5,000+) compared to Costco (800 worldwide). I’m sure they did damage to mom and pop as well plus grocery stores. At least Costco pays their workers more. As far as Southwest, I use them for most domestic flights. I had 6 round trips from the west coast in 2021.
Walmart not paying enough??? Did I hear that correctly??? Possibly from day 1, no experience, still in school, etc.?? Dedicated, all of those “Things” that interest employers, Walmart will pay Quite Well. Have a Degree in something useful, advancement pays very well. Walmart Pays Well, it’s amazing how people still believe the old lies. Costco has fallen from the Golden Perch they had held due to multiple issues with employees to Quality. Costco has its Own Hands in the Destruction and Aftermath!
Southwest is the best thing to happen to Hawaii travel in a long time. Now I do like Hawaiian, but their prices are just to high. I fly with my family using miles and Southwest is just plain better.
1) no change fees.
2) refund credits on cash or miles if the price drops.
3) 2 free bags.
4) Miles rewrds are usually half the cost of Hawaiian.
Sacramento to HNL (1 week) then HNL to OGG (2 weeks) then back to SAC (17,000 miles)
(Hawaiian was 35,000)(May 2022)
RT travel from Sacramento to Kona for 14,000 miles (Hawaiian is 35,000) (Sept 2022)
Southwest is killing it. I am sitting on over 350,000 Hawaiian miles but can’t bring myself to use 2x the miles per trip.
It makes Sound Sense Not to fly Hawaiian when SWA is available, the Benefits are apparent. Might as well save the Hawaiian miles for last. Savings are Savings and Hawaiian just isn’t where anyone is going to find any. The statement “Fly Hawaiian because it Benefits Hawaii” doesn’t make any sense. Hawaiian Benefits Hawaiian, plain and simple!
Very well said!