Revealing Hawaiian Airlines’ conference call late yesterday was to discuss understandably dismal 2020 results and their plans for the future. We were on the call, and here are some takeaways for Hawaii travelers from the airline and us. Bottom line, recovery will happen, but it will not be a straight line to the goal, according to CEO Peter Ingram.
60% of passengers choose Hawaiian’s own COVID testing.
Testing is step one in their recovery. In that area, Hawaiian implemented four new testing partners and four new testing locations before year-end and now has five total partners in seven dedicated testing facilities.
The company said it now tests a majority of its passengers through their own partners in the pre-travel program, and they expect that percentage to continue to increase with time. Importantly, their key providers do not offer medically necessary testing. So, their capacity has not been strained by the surge in COVID-19 cases on the U.S. mainland. As a result, there is no difficulty meeting the 72-hour requirements, according to Hawaiian.
Their partner Worksite Labs offers the least expensive, unsubsidized state-approved tests available according to Hawaiian, which reports higher customer satisfaction with them compared to other options.
BOH: That’s a smart move all around. Especially using non-medical necessity companies. That’s where CVS got bogged down trying to do Hawaii travel at the same time. Can those of you who have used Hawaiian’s testing partners please confirm how well it has worked?
What’s the impact of state’s changing, island-by-island rules?
Peter Ingram spoke to the white elephant in the room that we too have frequently addressed. He said that the island by island policies “adds expense, the inconvenience adds friction to travel, creates confusion for travelers, the validation process at airports is cumbersome.”
Peter also mentioned that inter-island travel had not seen any substantial uptick, even with the testing program.
Hawaiian is adding four new routes this spring.
- Long Beach and Ontario routes to Honolulu will increase Hawaiian’s already significant presence in Southern California and provide more convenience.
- Austin and Orlando are seen as fast-growing market opportunities since they had no nonstop Hawaii service previously.
Hawaiian acknowledged that “It may take some time to develop these new markets fully.”
BOH: We concur that Austin and Orlando will take significant effort, as was the case when Hawaiian first ventured to New York.
Expecting 75-85% demand return by summer 2021.
Peter said, “Coupled with our expectation of restoring service in previously served markets, we remain on track to operate 75% to 85% of our 2019 capacity in summer 2021.”
BOH: Wow, that’s extreme optimism, and we among others were a little surprised. We hope that Peter is correct. If it isn’t the case, flight schedules will need to devolve quickly.
Vaccination holds the true key to Hawaiian’s recovery.
While admitting challenges remain in the short term, Peter said that while pre-travel testing is one step one, “Vaccination holds the true key to restoring demand closer to historical levels.”
How 2021 will stack up according to Hawaiian Airlines.
In the first quarter, Hawaiian anticipates its capacity will be down by 50% compared to normal.
But by summer 2021, the company plans to operate 75% to 85% of its 2019 capacity. Hawaiian said that it anticipates “North America capacity reaching about 80% to 100% compared to 2019 levels.”
Hawaiian said bookings thus far for 2021 are about a third of 2019 levels.
The company believes that will begin accelerating with lower caseloads and increased public confidence based on vaccine rollout.
BOH: What has happened is that the booking window has become extremely short due to variables, including a general lack of travel confidence, made worse with Hawaii rules. That booking needs to expand and soon.
Update on Boeing 717 interisland fleet change.
CEO Peter Ingram also addressed the change of planes anticipated to be announced in the next few years. Hawaiian is still planning on operating the current Boeing 717 fleet through the middle of the decade, which at this point, is not far off. The aging planes are now only used by a few carriers and are no longer manufactured. Peter said he believes Hawaiian has “The service contracts in place with the key providers to work us through to the middle of the decade.”
BOH: We would anticipate a fleet change announcement in the next year or so in preparation for a 2025 delivery start date.
Hawaiian Airlines’ take on Hawaii tourism going forward.
Peter said that “We have certainly proved during this pandemic that the overall economy here in Hawaii is absolutely, at this moment in history and for the foreseeable future, reliant on a healthy and vibrant visitor industry.” That while adding that Hawaii must, “Look at ways to make sure we’re taking care of the cherish natural resources have and maintaining our oceans and our lands and providing that balance that gives us a basis for sustainability in the long term.”
Boeing 787 Dreamliner fleet is still arriving.
Hawaiian confirmed it would take delivery of the first two of 10 787s late next year. They are set to enter service in early 2023. There was no further information provided about the delivery schedule for the remaining planes.
BOH: Hawaiian has not indicated the routes that will utilize the longer-range widebody planes. London and Southeast Asia are the two most likely destinations, although there are other possibilities.
Vaccinations will give Hawaii travel a booster shot.
Peter said, “if you look at some of our demographics right now, even with the small number of travelers we have, one of the areas that have really taken a hit is people over the age of 60 or 65, who are more vulnerable to the effects of the disease. And so, I think, as those folks get vaccinated, they move into the potential traveler pool, and now we’re looking for demand from a bigger pool of potential guests again.”
BOH: Interesting situation with one of the company’s big demographics. Furthermore, Hawaiian doesn’t know when the technology for vaccination passport travel might be implemented, and much of it is dependent on state and federal government decisions. They are following that closely as standards are finalized and products come to market.
Image of Hawaiian Airlines Boeing 787 Dreamliner.
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I am wondering where testing positive for antibodies falls within the travel guidelines? Is there additional testing necessary? The results are from the American Red Cross and came from a blood donation.
Thank you for all that you during normal times and for the massive amounts of communication during these “changing by the moment” times even more.
Hi Tom.
Thank you. The information about the testing waiver is contained here: https://beatofhawaii.com/ultimate-guide-to-hawaii-travel-during-covid/. It is valid only if you have recovered within the past 90 days. Hope that helps.
Aloha.
On my previous three trips to Hawaii since October 15 we used Walgreens for testing. We didn’t get our results back for our third trip in December until a few hours before the flight. This was a little stressful. Three of us flew to Maui from LAX on January 18. We decided for this trip to test with Worksite Labs. We live in South Orange county so we made our appointments for the Long Beach site. We got there about 15 minutes before our appointment time and drove right up to the check in person. We were out of there in less than 10 minutes. All three of us got our results back the same day in just seven hours after we took the test. I would highly recommend using Worksite Labs.
It’ll be interesting to see where Hawaiian goes with a MD-95/717 replacement. Right now, the C-Series/A220 is really the only viable modern choice, unless Embraer launches an all new plane or seriously updates its current offerings. Both likely offer more range and weight than a short haul interisland fleet requires, which is why the 717 and the MD-80 and DC-9 before it were such a perfect fits for Hawaiian – the plane’s capabilities nearly perfectly matched precisely what Hawaiian needed. Boeing is talking about dusting off its NSA project yet again – when aren’t they? – and I suppose this might have a chance. The major issue will be the engines, which have to endure multiple heat up and cool downs daily. It’ll be interesting to see what road Hawaiian eventually takes, and it will be equally sad to see the last of the Mad Dogs leaving Hawaii’s skies.
Hawaii, and it’s economy, is 100% tied to the mess the governors and mayors have created with ass backward rules, policies, changes in rules, different islands playing politics..
Traffic was increasing nicely, reduced but gradually building, right up to the point of Kawakami going rogue, and Ige changing the pre test rules….. again….
What went from roughly 100 passengers on an airplane, reduced back to 30. And it coincided directly with various changes in rules.
Victorino requiring an app, because nobody was downloading it voluntarily.
In 2 years, as locals are losing their homes to mainland investors, they’ll have roughly 6 people to blame. And 3 of them will be running for Governor.
Quite frankly Hawaiian could do a better job of marketing Hawaii then the HTA……..let them do it and don’t worry about the State funding.
State could pay Hawaiian way less then they have been spending on HTA and get better results .
Hawaiian has a much better handle on the market then anyone else and as Hawaii’s flagship airline they are an asset the state should use.
true, but then the good ‘Ole boy system would be cast aside. Ige, or whoever is governor, wouldn’t have a place for their pals to collect paychecks, retirement, medical and the rest.
Mahalo Beat of Hawai’i for taking the time to update us on the call with Mr. Ingram.
I think his numbers on travel are very interesting, if not wishful thinking, while playing to his main audience Hawai’ian Airline’s shareholders.
Here’s to a hopeful year ahead, with COVID-19 numbers falling soon.
Stay safe and blessed.
Much Aloha to you both 🌺
Hi Pam.
Thanks for going on this ride with us. We concur that better news ahead is needed.
Aloha.
You are interested in knowing how your trusted travel partners are working. Well, to be honest, Hawaii doesn’t leave many options for those traveling from the East Coast. We only have CVS and Walgreens in this region and they are tremendously backed up. Not enough locations are authorized to do the testing. We recently travelled to Hawaii and our tests came in 5 hours after landing. We were not allowed to upload the results at that time – even though there is a 5 hour time difference to take into consideration. We had to quarantine 10 days out of a 14 day trip. We were there for my son’s graduation from UH Manoa. It was not the trip we had hoped for. Fortunately we have lived in Hawaii twice before and so had less sightseeing to do than most who choose to travel to the beautiful island. My suggestion would be to authorize more trusted partners on the East Coast. You have so so many options for west coast folks. Not everyone changes planes on the west coast either. Mahalo.
Hi Melinda.
Thanks for the feedback.
Aloha.
Almost everyone in the US that wants to be should be vaccinated by the end of the Summer 2021. At that point people will want to get out of their cities, use all of the time off that they have saved up for 1.5 years, and get together with their families. 75% is a *conservative* estimate for the return of tourism to Hawaii by the end of the summer. There’s a real scenario in which August 2021 ends up with far greater travel demand than August 2019.
I’m aware that this contradicts the Hawaii Tourism Authority, but they have shown very little grasp of the dynamics happening right now in the travel industry.
I love receiving and reading your emails. I love the updates, but I’m really disappointed in the likelihood that traveling by plane may be restricted to people that have been vaccinated. I refuse to be vaccinated, which means my wife and I won’t be going to Hawaii anytime soon. We are so bummed.
We love you guys.
Thanks for keeping us informed.
Jay & Marsha in Odessa, Texas
Hi Jay.
Thank you! It is so unclear at the moment how this will evolve as far as air travel goes, not just to Hawaii of course. Don’t give up hope. And please let us know how it goes.
Aloha.
Same here. NO vaccine for us either. So, We banked our timeshare and will travel elsewhere. Doesn’t look like Hawaii is in our future. Too bad. We do have many fond memories of the islands. Were so looking forward to another visit.