While flying Hawaiian Airlines yesterday to the Honolulu press conference, we saw first hand how the news was impacting employees. One flight attendant told us she heard the news on the plane. Another flight attendant said she only wanted to fly with Hawaiian because her parents worked for the airline for thirty years. It’s clearly not easy to show up for work and see that the company you have devoted your career to is planning to be sold to another airline.
Hawaiian Airlines is more than an airline to Hawaii.
It’s the largest private employer in the state and is also emblematic of strong local pride.
For those of us who live here, having an airline based in Honolulu with international, mainland, and interisland routes was always about a sense of pride, local ability, and much more. Hawaiian flew with an Aloha spirit that none of the others could duplicate since Aloha’s demise while proudly displaying the flag of the State of Hawaii, as its own flag carrier.
When we find ourselves in Sydney or at JFK, for example, and we see the Pualani on the Hawaiian tail, it evokes a feeling of comfort and home. If the sale goes through, all operations will soon become based instead in Seattle.
Is it even possible to maintain separate branding between Alaska and Hawaiian?
We’ve seen this work before in similar circumstances. Several months ago, we flew SWISS to Geneva and enjoyed service from flight attendants who are Swiss nationals, food choices that reflected their own country, and a plane proudly displaying the flag of Switzerland. In actuality, SWISS is whoely owned by a German airline, Lufthansa, but kept its branding. If you dig deeper, however, Lufthansa provides the maintenance, technology, call service centers, and most of the remaining infrastructure that keeps SWISS flying.
At this point, Alaska also plans to let Hawaiian keep its unique identity. That didn’t happen, however, when Alaska took over Virgin America. But perhaps in this case it will truly be different and seen as a good marketing move to have the Hawaiian name and service kept. And also given that Hawaiian is a far stronger brand than Virgin America. But how that will ultimately unfold is anyone’s guess.
Safety comes first during distracted times.
Jeff spoke with Joe Sprague, who is now in charge of Alaska Airlines’ integration with Hawaiian Airlines. He reports directly to Ben Minicucci and has had a long and diverse career with Alaska. Joe mentioned, among other things, something that we’ve heard from no one else. That is about keeping safety first during distractions caused by the acquisition and how it impacts the airlines’ employees. This came as great advice from a seasoned airline executive.
Emotions ran high at the Honolulu press conference.
Hawaiian CEO Peter Ingram told Jeff that he sadly hadn’t had time to be with the employees yet to help them work through the emotions they were starting to experience. Keep in mind that most employees only found out about the acquisition at 9 am on Sunday morning.
It was hard to hide the emotions we saw between these two companies that we have known well for so long. Ben, CEO of Alaska, was respectful, restrained, but ebullient about the upcoming merger, the largest event ever for Alaska Airlines. Peter Ingram, who we’ve known and watched far longer than Ben, was a pro. He put on a strong face and did a superb job of explaining the acquisition from the Hawaiian side of things. Nonetheless, his face (lead image) couldn’t hide what we perceived as profound sadness too. In addition to everything else, Peter will be losing his job as CEO, when the merger is concluded. Ben said, “there can only be one CEO.” Jeff told Peter he has the hardest job at Hawaiian, to which Peter responded, “I have the best job.”
Would Hawaiian have survived without Alaska Airlines?
That’s hard to say, and we’ll leave that mostly to others including your comments. We know that Hawaiian’s business, like other airlines, suffered deeply during and since Covid. They have been a myriad of problems, too, that have included significant issues with their technology, including the online reservation system. Hawaiian has also been hurt by significant flight cancellations and delays, based on issues associated with Honolulu airport repairs, pilot and staff shortages, and other factors, many entirely outside of their control.
Hawaiian Airlines’ international business has never recovered from Covid, and it will be years before it does fully. They also faced purchasing a new fleet of interisland planes to replace the largely used-up Boeing 717 planes that are now about two decades old and have extremely high usage cycles due to the short and frequent hops interisland.
Southwest Hawaii flights came on strong as well and continue to provide significant ongoing competition to Hawaiian across both west coast and interisland routes.
As would be appropriate, Peter Ingram said yesterday that the merger was not a result of necessity and that they were approached entirely by Alaska Airlines early in 2023. On the other hand, the issues Hawaiian has and is facing are without doubt daunting for the relatively small regional carrier, which lacks the resources of larger airlines.
Hawaiian Airlines’ on-time performance slipped from 1st place to 5th place for all of 2022.
Peter Ingram told Jeff, however, that recently, Hawaiian has returned to number one in on-time airline performance for three of the last four months.
Can Hawaiian Airlines fix its litany of issues prior to the merger?
Jeff asked the CEOs about this specifically. He inquired about a range of items. Those outstanding include the reservation system coming to completion, the Boeing 787 Dreamliner deliveries, a new fleet to replace the very aged Boeing 717 interisland fleet, and the new airline-wide WiFi.
Peter Ingram addressed these as follows. The Dreamliner deliveries will start as expected, with one plane in early 2024. The Starlink WiFi will be rolled out in 2024 as planned. A decision on a Boeing 717 interisland fleet replacement will await being acquired by Alaska Airlines. The reservation system may or may not be concluded in its entirety prior to the 12-18 month period of regulatory approval and merger. In discussing it further with Avi Mannis, Senior Vice President at Hawaiian, he said that they are reviewing those aspects of the reservation system that can be completed during the time before the anticipated merger conclusion.
We look forward to your thoughts about the Hawaiian Airlines acquisition by Alaska Airlines.
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