Categorized | Business

JAL considers cutting Kona flight

Karin Stanton | Hawaii 24/7 Contributing Editor

Japan Airlines has included its Kona flight on a list of casualties as the airline tries to work its way out of bankruptcy. State, county and tourism industry leaders, however, are working to save the direct link between Japan and the Big Island.

Last week, reports from Japan indicated the carrier, which filed for bankruptcy in January, is considering slashing more than two dozen international routes and 30 domestic flights. The Narita-Kona direct flight was on that list, as were Sao Paulo, Milan, Bangkok and Beijing.

JAL also indicated it may ax more than 15,000 jobs within a year. Previously, the airline that lost $2 billion between April and December last year, said it would be downsizing its workforce over a period of three years.

With debts reportedly exceeding $25 billion, the carrier is undergoing a government-led restructuring that likely will involve cutting staff, pensions and routes.

Airline officials have said they will review routes on a case-by-case basis as part of the reorganization and will submit their final plan in June.

Mayor Billy Kenoi on Friday said he is working with visitor industry leaders in a coordinated strategy that combines the efforts of the county, the state, the Hawaii Tourism Authority and a variety of other stakeholders in the visitor industry to preserve Japan Air Lines’ direct flights to Kona.

“We understand that eliminating JAL’s direct flight to Kona is one possibility being considered in JAL’s much larger company-wide restructuring, but we are making a compelling case to the company and the industry for some quick, viable near-term steps that can be taken to boost the load and profitability of the route,” Kenoi said.

“The hotels, the tour wholesalers, the airline and our island community as a whole reap tremendous benefits from that route. We are all in this together, and we will work cooperatively to help JAL reach the best decision, a decision that protects this important route,” he said.

Japanese arrivals to the County of Hawaii have been a bright spot in island tourism, with arrivals up 5.3 percent in February 2010 over arrivals in February 2009. The average length of stay for visitors to the County from Japan increased by 9.5 percent in February.

JAL’s flights to Kona brought 69,175 visitors to the Big Island last year, a 4.4 percent increase over 2008 arrivals on the same route, Kenoi said. That demonstrates there is strong demand for travel to Hawaii, but the average fare has been dropping. In effect, JAL has increased load by reducing prices.

“JAL has been an excellent partner in our visitor industry, and all of the major players in the industry must now come together to search for ways to encourage the airline to continue its direct flights to Kona in this challenging time,” Kenoi said. “We will work with all of the beneficiaries of JAL’s direct flights to develop strategies to make that happen.”

A group of Hawaii tourism officials is planning to travel to Japan next week to meet with JAL executives and urge them to reconsider.

Three of the Big Island’s biggest events are great draws for Japanese visitors – Merrie Monarch Festival, Ironman World Triathlon Championship and Kona Coffee Cultural Festival. JAL also is a valued sponsor for Hawaii events and festivals.

Bobby Command, Kenoi’s West Hawaii executive assistant, said the relationship goes beyond flights and economics.

“There are deep, deep ties between the Big Island and Japan, both cultural and familial,” he said. “Last year, Emperor Akihito and Empress Michiko made a special point of stopping in Kona. After Honolulu, they didn’t go to any other island. They visited the Big Island. That says a lot.

“We still have a lot to offer,” Command said. “We just need to make sure the airline knows that, too.”

Historically, JAL is the largest foreign carrier serving Hawaii, and Japan is the state’s third-largest visitor market.

The Kona service was inaugurated in 1996. It brings up to 237 passengers per flight and returns to Japan with Big Island products ranging from abalone to papaya.

By August 2001 more than 10,000 passengers a month were arriving in Kona, although the numbers tanked after Sept. 11 and Carl Hayashi, the now-retired JAL Kona station manager, fought successfully to keep the flight with the support of the visitor industry, travel wholesalers and Hawaii County.

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