What’s Different This Time Around?

A subsidiary of Mesa Airlines named go! has entered interisland competition against Hawaiian and Aloha Airlines. Can we expect a replay of past conflicts with would-be third carriers? Certainly there will be similarities. All newcomers announce their arrival with a stunning fare war. A few days before the new airline begins operations, it’s not uncommon for a brief super-far war to take place. Mahalo offered $10 fares to ensure that its planes had plenty of passengers on them for the media coverage and for minimizing losses during the first month of service. Go! used a $19 fare for the same purpose but was trumped by Aloha’s surprise free-ticket giveaway.

Nonetheless, what lies before Hawaiian and Aloha is a battle like they’ve never before encountered. For one thing, go!’s parent company Mesa is the first mainland company to enter the market. The interisland market is a minor percentage of the parent company’s overall operation, and Mesa has over $300 million at its disposal. Thus, Hawaiian and Aloha will need to outmaneuver Go!-- they cannot depend upon a war of attrition.

Probably the greatest difference between go! and previous contenders is the aim of the newcomer. Go! has taken a predatory stance right from the start. More so than any conflict that Hawaii’s long-standing interisland airlines have faced before, this is a battle for survival. This doesn’t mean that Mesa will be willing to spend $300 million to capture a place in the market. It means that Hawaiian and Aloha must convince the decision makers at Mesa that the cost of entering this market exceeds the benefit. This is a challenge which will test the resolve and resourcefulness of Hawaii's longstanding airlines.