New Hawaii airline sparks fare war, free seat giveaway

Saturday, June 10, 2006

New Hawaii airline go! started interisland passenger service on Friday, but not before starting a fare war with Hawaii's two existing interisland carriers that culminated with one of them resorting to a free giveaway of seats on go!'s opening day.

The new airline, a division of Arizona-based Mesa Air Group, started a fare war in March when it offered an introductory fare of US $39.00 one-way, which was matched by Hawaiian Airlines and Aloha Airlines. Normal interisland fares prior to that point averaged about US$79 one way.

The fare war intensified in the week leading up to go!'s startup, when go! on Wednesday announced a $19.00 one-way fare good during go!'s first month of operation. Hawaiian immediately matched the fare but not by Aloha. Thom Nulty, Aloha's vice president of marketing, initially dismissed the fare cut, saying, "Over the years, we've seen many startups come and go with goofy fares designed to steal passengers away from Hawaii's homegrown airlines."

However, Aloha on Thursday went even goofier than both go! and Hawaiian, announcing a plan, called the "Great Go Away Giveaway," to give away 1,000 vouchers for free tickets at Hawaii airports on Friday morning on a first-come-first-served basis. Eager passengers lined up at Honolulu International Airport as early as 7 p.m. Thursday night to snag the free tickets, and the 500 tickets allotted at Honolulu were gone by 9 a.m. Friday.

Mesa Air CEO Jonathan Ornstein quipped on the name of Aloha's promotion, "They'd like us to go away so they don't have to give away seats." He also announced that go's original $39.00 promotional fare will become permanent.

Ornstein later reported that go!'s first day of operation went smoothly. "I think the day went really flawlessly, certainly in consideration it was our first day of operations," Ornstein said.