Hawaiian Airlines Records $107m Net Loss And Expects No Boeing 787s Until 2022

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Hawaiian Airlines today reported a net loss of $107 million. Alongside this, in the airline’s second quarter earnings call, CEO Peter Ingram stated that the airline was not anticipating any Boeing 787s until 2022 at the soonest.

A $107m net loss

Hawaiian Airlines saw sharp drops in revenue amid the ongoing COVID-19 pandemic. In the second quarter, the airline took in only $60 million in revenue. This was down almost 92% from the same period last year. About 50% of the airline’s revenue came from passenger bookings, while another 50% was split between cargo and other sources of revenue, down 50 and 48%, respectively. Passenger revenue, historically the airline’s strongest source of income, was down 95% year-over-year.

Combined, this brought Hawaiian Airlines to a $107 million net loss. Passenger load factor was a dismal 23% for the quarter. However, there was an improvement from bottomed-out demand in April. By June, Hawaiian recorded a load factor in the mid-40%, which was in line with the airline’s booking volumes that are about 40% of historic levels.

Much of this decline was a result of the extension of Hawaii’s mandate for out-of-state visitors to quarantine for 14 days. The strict requirement has severely limited tourism and hurt Hawaiian Airlines. Due to the extension, Hawaiian has extended suspensions for most mainland flights.

WARN Notices will be sent out

Hawaiian Airlines will be sending out WARN notices in the coming days. CEO Peter Ingram declined to go into specifics about how many notices would be sent out.

Payroll support from the federal government ends on September 30th. Before then, airlines are not allowed to furlough or layoff any employees. They can, however, incentivize voluntary leaves and separations. But any involuntary actions can only occur from October 1st– a day that many are dreading will become a bloodbath of layoffs and furloughs in the US aviation industry. While there are discussions about potentially extending that payroll support, there has been little movement on the issue inside the government.

Expecting to delay the Boeing 787 induction

Hawaiian Airlines placed an order for ten Boeing 787-9s with an option for ten more in July 2018. The first two of these aircraft were previously expected to arrive in 2021. However, in the airline’s second quarter earnings call, CEO Peter Ingram stated the following:

“We have also continued to have productive discussions with Boeing to rephase our Boeing 787 order. While not finalized, we do not expect to put the first two 787s into service until 2022 or 2023.”

Hawaiian’s Boeing 787s are one of the most hotly-awaited new aircraft. The airline is planning to install a new business class that offers a double bed configuration for the middle seats.

The 787s will complement the Airbus A330s. When Hawaiian ordered the aircraft, Mr. Ingram stated that the jet would be used to build upon the airline’s successful growth in Asia. Any potential London flights would also be.

Now, however, with the ongoing crisis, the 787s are not needed for expansion. The carrier is focused on rebuilding its network to the mainland USA, Oceania, and Asia. The current forecast will see the airline reinstate services to Japan and Korea before adding flights to Australia and New Zealand.

Are you sad to see the Boeing 787’s introduction with Hawaiian Airlines delayed? Let us know in the comments!

S: Simple Flying

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