Hawaiian Airlines tops off rapid expansion with plans for a new inter-island subsidiary

Fast-growing Hawaiian Airlines has broadened its significant expansion to include the establishment of a new inter-island subsidiary to operate smaller turboprop aircraft to destinations not viable for its current inter-island workhorse the Boeing 717. The recently unveiled plans occur as Hawaiian is working to reverse negative revenue performance it experienced in its inter-island network during 1Q2012 after it launched a new hub in Maui.

As Hawaiian is crafting its new regional strategy its likely rival in some of the smaller markets Island Air is planning to upgauge its fleet to higher-capacity ATR aircraft, which could create unsustainable levels of capacity on the smaller inter-island routes. All this shuffling is against a backdrop of Hawaiian's aggressive push into long-haul markets from its Honolulu hub into Asia, joined by new expansion into Australia and New Zealand.