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Island Air Files for Chapter 11, Continues Normal Operations

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Island Air Files for Chapter 11, Continues Normal Operations

Ivan Nishimura

Island Air Files for Chapter 11, Continues Normal Operations
October 18
13:44 2017

MIAMI — Hawaii Island Air, Inc., the holding company of Island Air, is filing for Chapter 11 bankruptcy protection to continue normal operations while facing legal issues recently presented by aircraft lessors.

On October 12, 2017, while negotiating its aircraft leases, Island Air was surprised by lessors’ ceasing their contracts and demanding the airline to surrender its airplanes.

Filing for Chapter 11 allows Island Air to continue operations on their scheduled routes and, somehow, put on hold all the threats the aircraft lessors have posed.

Island Air will maintain its frequent flyer program running as well as all regular services to all its customers. All its 400 employees are safe, and the airline will continue operating normally.

PHOTO: Ivan Nishimura

“Island Air will continue to hold our customers and employees, as well as our invaluable vendors, as our main priorities during this reorganization process,” said David Uchiyama, Island Air President, and CEO in a statement.

“Once we have completed the reorganization process, Island Air expects to emerge as a stronger airline with a solid financial structure that will allow us to continue to meet the demands of Hawai‘i’s dynamic interisland market while positioning us for future growth and expansion.”

Island Air’s highest quarterly revenue since 2013 was on the first-quarter of 2017. In the second quarter, the airline recorded $12.5 million in revenues—its highest quarterly revenue in more than a decade.

In January 2016, PacifiCap acquired a controlling interest in Island Air from Ohana Airline Holdings, LLC (OAH), owned by Oracle Corporation’s founder, Larry Ellison. Since then, the airline has been focused on improving operations, increasing efficiencies and elevating service to customers.

Island Air is currently modernizing its information technology system to enhance online reservation and bookings, expand digital services and improve the interface with codeshare and interline airline partners.

Founded in 1980 as Princeville Airways, the company was renamed Island Air in 1992 and has been serving the Islands of Hawaii for 37 years.

Island Air currently offers approximately 200 flights per week between O‘ahu, Maui, Kaua‘i and Hawai‘i Island. The airline counts with a fleet of five Bombardier Q400s. They also had five ATR-72s that were retired on September 5th, 2017.

PHOTO: Konstantin von Wedelstaedt

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Alvaro Sanchez

Alvaro Sanchez

Online Executive Editor. Journalist and Certified Radio Host. Studying for a Specialization in Public Opinion and Political Communications. Even though I love politics I've found myself fascinated by the Aviation World. I'm also passionate by economy, strategic communications, my family, my country, and dogs. mc@airwaysmag.com

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