How Hawaiian’s A321neos could benefit Australasia and Japan

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August 06, 2018
A321neo Hawaiian expansion
The A321neo. Photo: Hawaiian Airlines.

US West Coast destinations have already profited from the arrival at Hawaiian Airlines of the A321neo but longer-haul destinations such as Brisbane, Auckland, Sapporo and Seoul could also see benefits.

Airbus’ fuel-efficient, single-aisle aircraft is currently being used by Hawaiian to replace its Boeing 767 fleet and open up new markets between Hawaii and the West Coast.

But as the planes keep coming in 2019, they will also start freeing up Airbus A330-200s for use on longer-haul routes.

It is all part of a growth strategy that has seen the niche carrier double in size in 10 years and become one of the world’s most profitable airlines in terms of operating margin.

It serves 11 destinations on the US West Coast and New York in the east as well as 10 international and 11 inter-island ports.

The international destinations include four in Hawaii’s most important market, Japan, and it is awaiting approval to enter a joint venture with Japan Airlines.

READ our ratings for Hawaiian Airlines.

So far, Hawaiian has taken delivery of eight of 18  A321neos, allowing it to reduce its 767 fleet from eight aircraft to six since the beginning of the year.  It expects the last of  Boeing widebodies to be gone by early next year.

Until the arrival of Boeing 787-9s in early 2021, the airline will be relying on a mix of 20 Boeing 717s, the 189-seat A321neos and 24 278-seat A330-200s.

Its fleet strategy will see the 128-seat B717s continue to take care of flights of up to an hour on Hawaiian’s “neighbor island” network along with a handful of ATR turboprops.

The A321neos will handle flights of up to six hours, including some mid-haul US routes.

“The 321 … really allows us to successfully serve some of the mid-size markets between the Western US and Hawaii, so places that have 100 to 200 passengers a day that are a little bit thinner than what you can successfully do with a widebody,’’  Hawaiian chief executive Peter Ingram told AirlineRatings on the sidelines of a recent CAPA aviation and corporate travel summit in Sydney.

“Long Beach (where Hawaiian recently started a service to Honolulu) is an example but it’s also a place like Oakland where we had a Honolulu flight and a Maui flight before and we’re adding a Lihue flight.

“Or a place like Portland where we had a Honolulu flight only, now we’re going to have a Honolulu and a Maui flight.”

While Hawaiian is concentrating in 2018 on reshaping its Hawaii-US network, Ingram said the arrival of additional A321s next year would provide the opportunity to free up A330s for long-haul expansion.

“We haven’t finalised any of those specific plans yet  but we’re looking at more opportunities here in Australia, we’re looking at more opportunities in Japan and elsewhere in Asia and we’re also looking more in the eastern US,’’ he said, noting the carrier was keen to increase frequencies to current destinations that are less than daily.

“That includes Brisbane, it includes Sapporo in Japan, it includes  Seoul in Korea and it includes Auckland — they are all less than daily in our network today,” he added.

Ingram believes the leisure-focused  Hawaiian benefits from daily services because they provide more flexibility for passengers planning their holidays.

He said Hawaiian would probably make a decision on the longer haul routes towards the end of this year or early next year and launch in the late northern spring or early summer.

The airline’s new single-aisle kid on the block comes appointed with 16 Premium Cabin seats, 44 Extra Comfort seats and 129 in the main cabin.

Hawaii attracts a wide mix of passengers who are skewed towards the premium end of the market. Like many Pacific carriers, it prides itself on warm customer service reflecting the Hawaiian culture and reinforces this by using local products.

Asked how customers had coped with a switch from a widebody to a single-aisle aircraft, Ingram said it had largely been fine.

“I think people do appreciate the openness of a widebody airplane and that’s something that we’ve always appreciated that we had as a feature of our network,’’ he said.

“But I think people also appreciate low fares and great efficiency and you can’t deny the economics of an aircraft like the 321neo on the Western US to Hawaii network.

“We were careful about how we laid out the interior of the aircraft to make sure we preserved — and even looked for opportunities to enhance — all the things people love about our widebody.

“The proportion of extra comfort seats on the aircraft is similar to what we have on our 330s post their recent modifications — I think it’s about 24 percent of the seats on the airplane are extra legroom, Extra Comfort seats.

“We always try and build in some distinctive elements that give you a real sense of the colors and sights and sounds of Hawaii to make sure you know you’re traveling on Hawaiian Airlines.”

The airline will see a new wave of changes when the first of 10 B787-9s arrives in the first quarter of 2021.

READ: Hawaiian eyes expansion after 787 buy.

Ingram said benefits of the new plane would include greater fuel efficiency and lower maintenance costs that would help the airline with its costs structure.

The 787 also has more range and is bigger than then the A330-200.

“So It allows us to look at some destinations that were maybe on the fringe of our reach today or a little bit beyond the fringe of our reach,’’ Ingram said. “And it will have a little bit more size.

“That efficiency, coupled with a bigger size,  will really make it a winner on some of the very high load factor routes on our existing network like Japan and, New York (or) Sydney. Particularly in Sydney, our loads are very high here.

“So we see a lot of opportunities both within the current network and beyond the current network.”

That included potential new destinations in Australia but Ingram said the carrier had nothing to announce at this stage.