Hawaiian Airlines weathers f/x and surcharge challenges just as its long haul network shows promise

Just as Hawaiian Airlines has taken a breather from explosive growth in the 2011 to 2013 time period, shifts in overall market dynamics have occurred, including the rapid appreciation of the USD against most global currencies and a sharp fall off in fuel surcharges. Those changes have created unit revenue shortfalls for most US airlines, even as significantly lower fuel prices are producing record profitability.

Although Hawaiian's business model is different from that of most US airlines, it has not been immune from revenue degradation in 2015. Nevertheless, the airline notes positive trends in its largest geography, North America. Capacity growth between Hawaii and the US west coast slowed to single digits in 3Q2015, with similar trends occurring in late 2015 and early into 2016.

Hawaiian has undertaken some pruning of its long haul network within the last couple of years, and the efforts have borne fruit, although the results are masked by pressures from foreign exchange rates and fuel surcharges. However, overall Hawaiian feels comfortable with its competitive position in the North American and long haul markets despite the headwinds pressuring its unit revenues.