Hawaiian Airlines Remains Profitable in Turbulent Skies

When the first quarter of 2012 drew to a close, numerous airlines released their financial numbers. Many posted a loss, with blame firmly placed on fuel prices.

But Hawaiian Airlines posted a profit for the first quarter of the year, and seems poised to get more business when its nonstop flights from New York to Honolulu start next month from JFK’s Terminal 5.

“We have a product people are demanding, and we are seeing a great response,” Peter Ingram, Hawaiian Airlines chief commercial officer (and former CFO) told Travel Agent. “Our prices are competitive in the marketplace, and we do our best to keep fares affordable.” To that end, the company focuses on cost structure, he says, investing in elements of product that people value the most and not spending money on things that don’t translate into a profit.

One aspect that sets Hawaiian apart from other domestic airlines is its policy of free meals. In fact, it remains one of the last domestic airlines to offer this perk, which will certainly be welcome on the 10-hour New York-Honolulu flight. “It’s one of those things that, financially, looks like an expense that can be taken away,” Ingram acknowledges, but notes that customers “appreciate” the meals.

“We’ve tried to deliver that one cost effectively by working with suppliers,” he says. “It is something that sets us apart, and regular visitors know to expect that.”

But the fact remains that fuel is increasingly expensive, and airfares have to fluctuate to accommodate that. “There’s not a lot we can do to change the global price of fuel,” Ingram says. “We have programs in place to improve fuel efficiency, and we’re investing in new aircraft.” The airline is adding new A330 planes to its fleet, which have better fuel efficiency. (Hawaiian plans to take delivery of one more new A330 in June, bringing the company total to nine. Hawaiian will also take delivery of 13 new A330s between 2013 and 2015.) The team is also adapting their 767s for better fuel efficiency. “We have top-to-bottom discipline around building efficient budgets and holding people accountable for meeting those budgets and delivering the product,” Ingram adds.
 

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