Beyond the beach niche

It’s an impressive operation. So impressive, indeed, that Southwest Airlines has spotted a lucrative opportunity to enter the market and eat Hawaiian’s plate lunch with both mainland and interisland flights.

One of the key requirements for any isolated airline, particularly one with a short-range fleet surrounded by a rather substantial amount of water, is to determine just the right amount of self-sufficiency the carrier needs. Maintenance, repair and overhaul (MRO) is one crucial example, and a major cost for any airline, but especially one that is a long flight or shipping lane away from the nearest logistics hub.

Measuring the benefits of keeping MRO inhouse is certainly a complex matter, but one metric is ontime performance, in which Hawaiian excels: US Department of Transportation data show Hawaiian as the most punctual of North American carriers over the last 16 years.

With some 170 daily interisland flights as the core of its operations, Hawaiian decided not to rely on facilities on the US mainland for its smaller aircraft, including its interisland Boeing 717 jet fleet. It’s extending this tactic to the new Airbus A321neo fleet that serves the US west coast. Instead, the Honolulu-based carrier operates its own internal MRO facilities, the last major improvement to which came in 2017 with the opening of a 27,500 square metre hangar at its home hub.
ABOVE: Hawaiian’s current longhaul go-to is the Airbus A330-200, due to be replaced by the Boeing 787-9. ROB FINLAYSON

…the Dreamliner will stretch Hawaiian’s network a little further

Inside the hangar, Hawaiian focuses on smaller jets that it would otherwise have to fly to the mainland

Hawaiian’s MRO centre in Honolulu can accommodate up to five narrowbodies — or one widebody and two narrowbodies — at the same time. The airline performs all maintenance on the airline’s 20 Boeing 717s here, from line servicing to heavy checks, including 12-year and 60,000 cycle inspections.

It’s also where the new A321neo fleet receives some of its MRO, Hawaiian’s vice president for technical operations Jim Landers tells the World of Aviation. “With a little more than two years in service, our requirements for this fleet have been heretofore limited to line and overnight maintenance tasks, which are performed here in HNL and at our recently opened bases located in Oakland, Sacramento and Portland.”

“Common to our industry partners, we outsource most of our component maintenance,” adds Landers. In July 2017 Hawaiian signed a long-term deal with global aerospace and defence aftermarket solutions company AAR for components support to the A321 fleet via its inventory hub in Chicago and other strategic operating hubs.

The long-haul fleet of 24 Airbus A330-200 works differently, Landers explains. “Regarding the A330, we can complete all line maintenance requirements up to an A check, but we outsource all heavy work on our widebody fleet as we do not have a facility optimised for the industrial capacity required for many of those tasks. In total, approximately 60 per cent of our total maintenance expense, which is around $300 million per year, is outsourced.”

Delta TechOps, Delta Airlines’ maintenance division and MRO business provider, is a key strategic ally for the A330 fleet through its Complete Fleet Services, offering line maintenance services across all the stations outside of Hawai‘i where Hawaiian flies the aircraft. Delta also provides a host of support services on the fleet, including engineering, technical records, components maintenance and logistics. Heavy checks, up to the C level, are performed at Delta’s Minneapolis–Saint Paul facility, which has become an Airbus centre of excellence for the A330.

In less than a year, though, the first of Hawaiian’s 10 Boeing 787-9 Dreamliners arrive.

On the engine side, Hawaiian has a full service agreement with General Electric for 20 of the GEnx engines, with options for a further 20, as well as spares. The deal is worth $1.7 billion, and includes flight-hour service assistance, under which GE is responsible for all maintenance on Hawaiian’s engines for a period of 10 years, with a possible extension for six more years after that deadline. It is, in modern technology terms, Engines As A Service.

Hawaiian is keeping mum on the further details of its plans for the Dreamliners’ maintenance but the airline’s Jim Landers tells the WOFA that “our team is already working with Boeing to gain insight into the technology that drives a different approach to MRO on this aircraft. From the big data that the aircraft delivers to inform preventative maintenance decisions to the all-composite structure of the plane reducing the incidence of corrosion, we are very much looking forward to welcoming the Dreamliner and the opportunity to become experts with this fleet type.”

Moreover, Landers notes, the tradeoff of the effort of putting a new aircraft into service is a delay in the check calendar. “Of course, we are pleased to reap the cost-saving benefit of the heavy maintenance honeymoon common with any fleet transition, something we are currently enjoying with our fleet of A321s.”

No aircraft serves Hawaiian Airlines quite so uniquely as the Boeing 717

The internet of things arrives at Hawaiian on a grand scale with the 787

New aircraft also come with new features, and in particular the ability to drive new MRO efficiencies with the internet of things: the constellation of increasingly tiny sensors generating unprecedented amounts of data, which can be used to improve operations.

On Boeing’s 787, this package is called e-Enablement, Landers explains, and means that the 787 can “collect a vast amount of data during the flight, including anomalies and minor malfunctions, monitor key engine parameters such as temperature and vibration, and transmit this flow of information in real time to the ground, where maintenance staff can act consequently while the aircraft is still in the air and then intervene in the most timely manner and with the adequate tools or components as soon as the plane stops at the gate.”

That will, Landers says, “contribute to make maintenance even more efficient, helping the airline to maintain its enviable performance in terms of punctuality and reliability of its flights”.

On the technical side, the information is transmitted to a Boeing server and processed there, and Hawaiian’s MRO team has full access whenever it’s needed.

In the other direction, the Dreamliners will offer “the possibility to load remotely, over the air, pieces of software, where on less technologically advanced aircraft, including the A330, you have to remove the ‘box’ from the plane and bring it to the workshop in order to execute the upgrade — and then, of course, put the box back in its proper position. That, once again, reduces operations and time to complete the task,” Landers explains.

In maintenance hangars and on the line, too, technology is leaping ahead at Hawaiian.

To get MRO work done faster and smarter Hawaiian has been working with maintenance software provider TRAX for nearly a decade to provide modern consumer hardware with specialised software applications to its teams, which comprise some 450 mechanics, of which 380 are in Honolulu with the rest at outstations.

These apps cover production and manpower data, tasks, deadlines and non-routine issues, as well as job assignments. Hawaiian issues an iPad Mini to mechanics, who then have the option to store it at work in charging lockers, or take it home after their shift. The iPads facilitate communication between mechanics and enable team members to do their job in a streamlined manner by viewing manuals, signing off work, order parts, or contacting their leads without leaving the aircraft they are on to return to a desktop computer.

Next to come will be the adoption of GPS tracking for ground support equipment, Hawaiian’s Jim Landers says. “Our concept of GPS tracking is to enable a comprehensive fleet management system that will provide real time data to enable efficient utilisation of ground support equipment. Though not yet implemented, we expect that it will provide a return of the investment through improved utilisation, performance monitoring and improved lifecycle cost.”

As MRO procedures and tools continuously evolve, demand for highly skilled maintenance technicians remains high, following the airline’s Pacific expansion and the recent entry into service of new-generation aircraft.

“Practically, we are constantly recruiting,” Landers quips. “We are fortunate to be able to select from a pool of people who want to work in the beautiful islands of Hawai‘i. We can pick the very best talent, and they stay with us for a long time. Over our 90 years, we have built a huge amount of institutional knowledge. That is invaluable, because of the unique challenges of flying to, from and among the islands. We also partner with Honolulu Community College’s Aeronautics Maintenance Technology Program to recruit local talent via an apprenticeship programme set up with the support of the International Association of Machinists and Aerospace Workers”.

Hawai‘i isn’t just attractive to live in, of course: it’s also a major tourist market, and after successfully fighting off competition for years, there’s a new game in town.

Hawaiian’s MRO centre in Honolulu can accommodate up to five narrowbodies

Hawaiian plans a multi-pronged defence against Southwest’s incursions

If you happen to be a US airline with an entrenched hub operation, perhaps the last thing you want is for the world’s largest low-cost carrier to enter your bread-and-butter markets.

In 2019, Southwest Airlines did just that in Hawai‘i, launching flights from the mainland US and, immediately thereafter, interisland flights. Those markets had been almost exclusively Hawaiian’s since Aloha Airlines’ passenger services shut down back in 2008.

Southwest began its invasion from California, with a daily flight from Oakland, east of San Francisco, then from San José to its south, and then from Sacramento.

As of January 2020, Southwest’s California-Hawai‘i operation had grown to 12 daily rotations, with services from Honolulu from all three airports, to Kahului from Sacramento, and from San José and Oakland to Kahului, Kona and Līhu’e.

On April 20, San Diego, south of Los Angeles but within some of the LA catchment area, will be added to the schedule through daily services to Honolulu and Kahului, with one-way fares starting from $129 — remarkably low. All the sectors are in direct competition with Hawaiian, as are the interisland services operated by Southwest from Honolulu to Kahului (six times a day), Honolulu to Kona, Hilo and Lihue (four times a day each) and Kahului to Kona (daily), sold at one-way fares starting from $49.

Hawaiian’s response has mirrored other carriers whose operations have been threatened by LCCs: basic economy. In a move to strengthen its appeal towards the most price-conscious travellers, in September Hawaiian launched sales of Main Cabin Basic fares in all North American markets.

Passengers selecting this booking option retain the possibility to carry on one bag plus personal item and are served inflight meals, but do not have access to certain travel services like advance seat selection and upgrade to Economy Extra or First Class.

Hawaiian is also fortunate to have A321neo aircraft to use as part of its defence, despite early teething problems with the Pratt & Whitney PW1100G engines, previously known as geared turbofan, or GTF. The fuel-efficient narrowbodies and their increased range offer Hawaiian the opportunity to increase service to secondary markets and to reduce capacity where a widebody would be too large.

The strategy is, in essence, to serve long and thin US west coast routes from Honolulu where an A330 would offer too much capacity, and to increase direct services from the mainland outside Honolulu.

Until 2018, Kahului on the island of Maui was mostly a pivotal airport of the airline’s interisland network, with just a few A330 flights per week connecting it to major cities on the US West Coast. Today, using its A321neo, Hawaiian connects daily the main airport on Maui island to Las Vegas, San Diego, San José, Oakland, Sacramento, San Francisco and Portland.

Hawaiian’s fleeting choices suit its particular island circumstances

No aircraft serves Hawaiian Airlines quite so uniquely as the Boeing 717 fleet it operates within the islands of Hawai‘i on some 170 flights a day. Each airframe can serve up to 16 sectors per day, racking up pressurisation and depressurisation cycles in an extreme environment of salty, humid air at sea level. Metal fatigue is thus, clearly, a major risk.

With flight times in the 30 to 40-minute range for most interisland flights, the aircraft levels off at altitude for just a few minutes, insufficient to rid the airframe of humidity that accumulates while the aircraft sits parked at airports that are, in many cases, on the seafront.

For example, on Hawaiian’s most important and most frequently served interisland route, from Honolulu to Kahului, the aircraft remains at a cruise altitude of just 13,000-15,000ft for less than 20 minutes.

In the past, the combination of extreme humidity and salt has had catastrophic effects. In 1988, the upper front part of the fuselage was ripped off an Aloha Airlines Boeing 737-200 en route between Hilo and Honolulu. Investigations revealed years of undetected metal corrosion.

Of course, technology, materials and maintenance practices and tools have made huge steps in the last 30 years and, while the 717 fleet average age is approaching 20 years, the narrowbodies are in good condition and are expected to stay in the fleet well into this decade. Their 128-passenger capacity, quick-turnaround capabilities and versatility on very short legs, as well as the passenger-pleasing 2+3 cross section of their interiors, are unrivalled for this niche — an opinion shared by Delta Air Lines and QantasLink in particular, and all three airlines are perennially keen to acquire more airframes. The extra seats sported by Southwest’s 175-seater Boeing 737-800 are, arguably, a less ideal fit for interisland operations where frequency is preferable to capacity.

With 17 A330-200s already in service and seven yet to arrive to complete what is today a 24 aircraft-strong fleet, Hawaiian’s 2014 order for six A330-800neo sounded as the natural choice to upgrade and eventually renovate its long-haul product, considering the extensive commonality between the two types.

So, when Hawaiian dropped the bombshell in 2018 that it was cancelling its deal with Airbus and replacing it with a $2.82 billion order for 10 Boeing 787-9 Dreamliners and 10 options, it made headlines. The Dreamliner order was a real coup for Boeing, which had been for many years the exclusive provider of long-range aircraft to Hawaiian with the 767-300.

Speaking at the airline’s headquarters on the occasion of the airline’s 90th anniversary, Hawaiian’s chief executive Peter Ingram explained that “when Airbus approached us with the A330-800 six years ago, the aircraft appeared to us as the natural substitute for our -200, as in point of technology, as in point of crew transition and passenger expectations. But after that, the model was capable to gain very few orders and we started to evaluate if it would be worth it, with such poor demand from airlines.”

“So,” Ingram continued, “after much consideration, we decided for a fresh, new start and the Dreamliner was the natural choice for a consistent upgrade of our long-haul fleet. The 787 has a longer range than the A330neo, it is more fuel efficient on the longest sectors of our network and in the -9 version that we ordered it gives us more payload. Of course, we also considered the marketing perspectives offered by an aircraft that was having huge success among airlines and the highest levels of appreciation from passengers around the world”.

Rumours of exceedingly keen pricing for the deal abounded around the airshow at the time, given that the deal was a coup for Boeing, defending its Dreamliner against the A330neo. That coup was exemplified in the airframer’s sales chief Ihssane Mounir sporting a Hawaiian shirt at Boeing’s closing press conference at the 2018 Farnborough Air Show during which the deal was concluded. That would be, of course, the last air show celebration by Boeing for some time.

In less than a year, the first of Hawaiian’s 10 Boeing 787-9 Dreamliners arrive

The 787 could make Hawaiian an even more important Pacific player

Operationally, the 787-9 will be Hawaiian’s go-to for the Pacific network and the US East Coast routes, where flight times are over the 10-hour mark.

While European nonstops are hugely complex, not least because of the need for diversions against headwinds on the way to Hawai‘i — London is some 6,300nm away, within but approaching the edge of range capabilities — the 787 could technically even be the first aircraft sporting the iconic Pualani livery to start service to a European airport.

More likely, Hawaiian’s thoughts connected with the entry into service of the Dreamliner will be turning northwards and westwards. In April 2014 Hawaiian started flights to Beijing, but the destination was closed a little more than four years later, in October 2018.

“In China we had started fairly well, but then there was not that stimulation of the demand that we expected, probably because the tourist market is still rather ‘green’ for a destination like Hawai‘i. However, China is still in our wish list,” chief executive Peter Ingram says, “and for sure we’ll give (it) another try in the near future”.

And then? With the new range and efficiency of the Dreamliner, Hawaiian may explore other eastern Asia and Oceania destinations, but in the past the airline opened and then closed Manila and Taipei and the perspectives for an expansion on that side of the Pacific may be limited: a few more Japanese cities, high-yield routes like Hong Kong and Singapore and perhaps Melbourne in Australia.

On the other side of the Pacific, much of Hawai‘i’s attraction compared with other beach destinations is in its proximity to the west coast, with the east and south of the country closer to Caribbean sun, sea and sand. And for major markets, competition is stiff from the hometown carriers in large cities like New York.

But what about as a Pacific hub? The airline itself admits that numbers of connecting passengers are very low and almost exclusively along an east-west trajectory. That said, the Dreamliner will stretch Hawaiian’s network a little further, boosting its traffic numbers a little higher as the natural consequence of fleet expansion.

Aviation is often unpredictable, though, and new technologies are often a spoiler. The 4700nm range of an Airbus A321XLR extends through most of the US, Canada and central America, New Zealand, a good part of eastern Australia and through the Philippines to eastern China and all of Japan. ETOPS authorisation beyond the aircraft’s 180 minutes wouldn’t be needed for most of these services.

The question, for Hawaiian, is one of ambition. Does the airline want to challenge neighbouring carriers like Fiji Airways and Air New Zealand for the Pacific connector niche? Or is it smarter for the airline to stay in its proverbial lane and do what it already does — serve its islands and the travellers drawn there — with its ho‘okipa hospitality culture and unique onboard experience?

In Numbers

HAWAIIAN AIRLINES

2 – Hubs: Honolulu Daniel K. Inouye International Airport (HNL), Kahului Airport (OGG)

61 – Fleet size

24 – A330-200 (Average age 6.6 years)

17 – A321neo (Average age 1.2 years)

20 – B717 (18.0 years)

1 – Subsidiaries ‘Ohana by Hawaiian
Fleet: 4 ATR42-500, 3 ATR72-600 cargo
Destinations: Honolulu, Kapalua, Lanai, Molokai

10 – Boeing 787-9 on order (plus 10 options)

30 – Destinations

8 – Hawai‘i
Hilo, Honolulu, Ho‘oleahua, Kahului, Kapalua, Kona, Lāna’i, Līhu’e.

12 – Continental US
Boston, Long Beach, Los Angeles LAX, New York JFK, Oakland, Ontario, Phoenix, Portland, Sacramento, San Diego, San José, Seattle.

6 – Asia
Fukuoka, Osaka, Sapporo, Seoul, Tokyo Haneda & Narita.

5 – Oceania
Auckland, Brisbane, Pago Pago, Papeete, Sydney.