Hawaiian Airlines, the state’s largest air carrier and the nations 12th largest, filed for bankruptcy this morning in U.S. Bankruptcy Court. The move is described by company officials as part of ongoing restructuring, prompted in part by an inability to renegotiate aircraft leasing contracts, and is not expected to impact service.
“What we are doing is taking this step to facilitate the completion of our restructuring plan,” airline spokesman Keoni Wagner said in an interview with Pacific Business News. “Hopefully, this wonâ€™t take long and we expect to be out [of bankruptcy] by fall.”
“It will be business as usual for the airline as we complete our restructuring,” said company chairman and CEO John W. Adams in a news release. “Tickets will be honored, maintenance and service will continue at the highest levels, and our HawaiianMiles program will continue to offer fliers significant award benefits.”
The news comes less than a week after the airline reported a 13.1 percent increase in “Revenue Passenger Miles” over February of last year, and less than a month after it completed a conversion of its entire fleet from DC-10s to Boeing 767s.
Hawaiian Airlines had also won several million dollars in concessions from pilots, mechanics, and flight attendants unions this month and last, and announced layoffs in November.
“Clearly we would have preferred to complete our restructuring outside of the Bankruptcy Court, particularly in light of our significant progress to date,” Adams said. “Despite our best efforts and extensive negotiations, however, we have been unable to reach agreement with certain of our aircraft lessors on reducing our lease rates to market levels.”
The airline reported a number of creditors, including Boeing Corp. and Wells Fargo Bank for aircraft financing. Local creditors include Panda Travel for agency commissions, and Tesoro Hawaii Corp. for fuel.
Hawaiian Airlines is publically traded on NASDAQ under the ticker symbol HA. In the last year, its stock has generally declined, from an early 2002 high of over $4 per share to a low of under $1.35 per share at the beginning of March. Trades of the airline’s stock is expected to cease as a result of the bankruptcy filing.
Hawaiian Airlines will set up a website specifically to provide information on the Chapter 11 filing at www.HALClaims.com.