Island Air ends 37 years of flying today

Airline to file for Chapter 7 Monday, Hawaiian offers help

After 37 years of commercial air service in Hawaii, Island Air will cease operations due to financial problems and litigation.

The interisland airline’s last flight will be Flight 449, which is scheduled to depart Kahului Airport at 10:14 p.m. tonight and arrive at Daniel K. Inouye International Airport on Oahu at 10:49 p.m., said Island Air spokesman Russell Pang on Thursday afternoon.

The airline, which has had seven round-trip flights daily between Kahului and Honolulu, said on its website Thursday afternoon that it was no longer accepting new reservations. Instead, it will stop operations at the end of today, the airline announced.

Tickets for flights after today “will not be honored, and customers will need to make alternative arrangements for interisland transportation,” said Pang.

The airline’s shutdown will affect about 6,500 passengers from Saturday through Thursday, he said.

Ticketed passengers should contact their travel agents or credit card companies to inquire about their refund policies, he said. Those who paid by cash or check may file a claim in bankruptcy court. “However, such a filing does not guarantee a refund,” he said.

For questions, call (800) 652-6541.

“Island Air is in contact with the other interisland carriers to request that they accommodate ticketed passengers, but the final decision will be up to each individual airline,” Pang said. The state’s largest interisland carrier, Hawaiian Airlines, is stepping into the void. Hawaiian said Thursday that it was “working quickly to provide flight relief for travelers who have been displaced by the shutdown of Island Air operations.”

From Saturday to Nov. 17, Island Air flyers holding confirmed reservations to/from/via Honolulu, Kahului, Kona and Lihue can stand by for coach class seating on Hawaiian’s regularly scheduled flights between the same origin and destination cities on the ticketed day of departure, Hawaiian said.

To qualify for standby travel, Island Air travelers must go to Hawaiian’s special customer service desk at the airport on the date of travel shown on their ticket to speak with a customer service agent and provide their Island Air paper or electronic ticket confirmation. Seats will be available on a first-come, first-served basis.

For Island Air travelers who require a confirmed itinerary, Hawaiian will be offering a special $71 one-way fare, inclusive of taxes and fees. This fare is available to Island Air customers holding tickets for flights between Saturday and Nov. 17. The special fare applies to round-trip tickets that include a return segment outside the seven-day window.

Customers can book this discounted fare by visiting Hawaiian’s help desk at the airport or by calling the reservations department at (800) 367-5320 and providing their Island Air ticket number.

Hawaii Island Air, Island Air’s parent company, filed for Chapter 11 bankruptcy protection Oct. 16 in an effort to continue operations following threats of legal action by the lessors of the airline’s new 78-seat Bombardier Q-400 turboprops to repossess three aircraft.

During the Chapter 11 proceedings, Island Air was flying 36 flights per day between Honolulu, Kahului, Lihue and Kona, Pang said.

“Island Air was unable to locate a new investor or lender to provide funding to support airline flight operations and a successful reorganization,” an Island Air news release said.

Island Air cited Wells Fargo Bank Northwest, N.A., and Elix 8 Ltd. as lessors of the aircraft who were seeking termination of all leases and repossession of the aircraft. The airline said it could no longer fight aggressive legal proceedings by the lessors without additional financing.

“Island Air has taken every measure possible to avoid this tremendous hardship to its passengers,” said David Uchiyama, Island Air president and CEO. “Island Air appreciates the loyalty and support its customers, management, employees and vendors have shown the airline, especially during the last few weeks of this bankruptcy process.”

Attorneys for Island Air are planning to file for Chapter 7 liquidation bankruptcy on Monday, Pang said.

“The closure will have a tremendous effect on 400 employees and their families, and the state will be working with Island Air to help the employees apply for unemployment insurance and provide assistance with job searches and training opportunities,” said Gov. David Ige on Thursday.

Founded in 1980 as Princeville Airways, the company was renamed Island Air in 1992. In January 2016, Hawaii-based investment company PacifiCap acquired controlling interest in the airline from Ohana Airline Holdings LLC, owned by Oracle founder Larry Ellison.

Hawaiian Airlines has increased its customer service staffing at airports statewide, and volunteer employees from the airline’s Team Kokua Concierge program will be stationed at affected airports to assist travelers and customer service agents in anticipation of a spike in traveler needs.

Hawaiian flyers who are booked to travel during this time frame are encouraged to take advantage of Hawaiian’s Web Check-In, airport kiosks and drive-thru check-in at the airport in Honolulu to avoid potentially longer lines during this period.

More information may be found at www.hawaiianairlines.com/Island-Air-Accommodations.

* Lee Imada can be reached at leeimada@mauinews.com.

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