Aloha Airlines stops passenger service as of March 31

[Susan-M]

Due to bankruptcy, Aloha has discontinued passenger service (after 61 years of being in business):

 

http://www.alohaairlines.com/home/home.php

[Cruisin' Ron VA]

http://money.cnn.com/2008/03/30/news/companies/aloha_bankruptcy.ap/index.htm?postversion=2008033019?cnn=yes

 

Here is the link from CNNmoney.

 

I wonder what David Banmiller meant by "Unfortunately, unfair competition has succeeded in driving us out of business."

 

I wish he would have expanded on that.

[greatam]

http://money.cnn.com/2008/03/30/news/companies/aloha_bankruptcy.ap/index.htm?postversion=2008033019?cnn=yes

 

Here is the link from CNNmoney.

 

I wonder what David Banmiller meant by "Unfortunately' date=' unfair competition has succeeded in driving us out of business."

 

I wish he would have expanded on that.[/quote']

 

Mesa Air Group started GO airline almost 2 years ago. They offer VERY cheap inter-island flights and essentially ran Aloha out of business on the passenger side. Aloha is keeping their freight business, which is substantial.

 

Mesa Air is partners with AmWest, US Air, Delta, United and Midwest. They run most of the commuter flights.

[Cruisin' Ron VA]

Yes I knew that but was wondering what was unfair about it. Were any laws broken? Or Aloha just couldnt handle competition after being pretty much the only game in town for so long?

[greatam]

Yes I knew that but was wondering what was unfair about it.

 

As with all the legacy's, high overhead/union wages which are undercut by the start ups. Most CEO's feel it is "unfair competition".

[Susan-M]

This explanation was given on Tripadvisor re Go!'s unfair business practice:

 

"Go asked for and got inside information on how both Aloha and Hawaiian did business saying they wanted to buy them, then turned around and used that inside info to start GO!....probably why they now have to pay Hawaiian 80 million in damages and will have to pay Aloha as soon as they have their day in court in October. GO! said they intended to drive one or both airlines out so they could make a fortune in Hawaii..."

 

Makes you wonder what the future of Go! is.:confused:

[Cruisin' Ron VA]

Ok got you.

 

GreatAm I have long though that union employees (not limited to airlines) bleed the payroll and end up causing some of their own problems. Then they wonder why they are out of a job later on. But thats another topic.

 

Such is life.

[hdawson]

Isn't there law against unfair, predatory and unsustainable pricing for the purpose of driving a competitor out of business?

[greatam]

This explanation was given on Tripadvisor re Go!'s unfair business practice:

 

"Go asked for and got inside information on how both Aloha and Hawaiian did business saying they wanted to buy them, then turned around and used that inside info to start GO!....probably why they now have to pay Hawaiian 80 million in damages and will have to pay Aloha as soon as they have their day in court in October. GO! said they intended to drive one or both airlines out so they could make a fortune in Hawaii..."

 

Makes you wonder what the future of Go! is.:confused:

 

Mesa Air Group is a well financed operation that runs the feeder/commuter airlines for AmWest/US Air, United and Delta, as well as a couple of regional operations. The CEO is VERY brash and outspoken.

 

This whole deal came about when Aloha and Hawaiian filed for bankruptcy. Mesa Air offered to either buy them out or partner up with them. Mesa offered $25 million to Aloha to partner. Financial disclosures and proprietary information HAD to be made available through bankruptcy courts or Aloha/the courts could not even look at the deal. Aloha PASSED on the deal. They chose a consortium of companies-Yucaipa-to partner with.

 

Hawaiian sued, won in October 2007 and Mesa has appealed. Aloha sued under anti-trust and the case has not been decided. Aloha shut down, Hawaiian is hanging on by a thread and Mesa, while hurt by the $80,000,000 verdict, will most likely be OK in the long run. Again, it appears that the only people loosing is the passengers and employees. Aloha employees are loosing their jobs, service between islands is cut by at least 1/3, and prices are bound to go sky high.

 

Here is a pretty good timeline of things as they happened:

 

How events unfolded

 

March 2003: Hawaiian Airlines files for bankruptcy protection.

 

April 2004: The federal bankruptcy court allows potential investors to study Hawaiian's books under a confidentiality agreement.

 

April to May 2004: Mesa downloads more than 60 documents, including more than 2,000 pages of proprietary information about Hawaiian's financial performance, projections and business strategy.

 

May 2004: Mesa is eliminated as a bidder for Hawaiian.

 

December 2004: Aloha Airlines files for bankruptcy protection.

 

April 2005: Mesa starts looking into acquiring or forming a business alliance with Aloha. Mesa retains GCW Consulting, an Arlington, Va.-based aviation consulting firm, to "look at a possible acquisition or some other structure for entry into the Hawai'i market."

 

June 2005: Hawaiian Airlines exits bankruptcy protection under the ownership of California-based Ranch Capital LLC.

 

January 2006: Mesa's Chief Executive Officer Jonathan Ornstein tells investors that Mesa's decision to enter the interisland market was based on its review of Hawaiian and Aloha Airlines during their bankruptcy cases.

 

February 2006: Hawaiian sues Mesa to bar the company from operating in the interisland market for two years. Hawaiian alleges Mesa improperly used confidential data it received when Hawaiian was in bankruptcy. Hawaiian later reduces the length of the ban it seeks to one year.

 

March 2006: Mesa begins selling tickets for its June 9 launch of interisland carrier go!

 

March 2006: Mesa files countersuit, accusing Hawaiian of trying to illegally block competition.

 

June 2006: Mesa launches go!

 

September 2006: Hawaiian alleges Mesa tried to drive Aloha out of business and cites e-mails by Mesa Chief Financial Officer Peter Murnane. One e-mail says: "If we assume Aloha stays in market and in business forever, this project makes no sense. We definitely don't want to wait for them to die, rather we should be the ones who give them the last push."

 

October 2006: U.S. Bankruptcy Judge Robert Faris rejects Hawaiian's request for a ban but says Mesa "probably breached the confidentiality agreement" by failing to return or destroy material it received. Faris also concludes that "at one time, Mesa hoped to drive Aloha out of business."

 

October 2006: Aloha sues Mesa, alleging that it misused confidential information in an attempt to drive Aloha out of business.

 

December 2006: Faris throws out Mesa's countersuit against Hawaiian.

 

August 2007: Hawaiian accuses Mesa CFO Murnane of destroying several computer files that included confidential Hawaiian material.

 

October 2007: Faris orders Mesa to pay Hawaiian $80 million in damages for misusing confidential business information.