Island Air (Hawaii)

Princeville Airways

Island Air was incorporated in 1980 by Colorado-based Consolidated Oil and Gas as Princeville Airways. It began scheduled services on September 9, 1980, between Honolulu and Princeville, Kauai using two de Havilland Canada DHC-6 Twin Otter STOL capable turboprop aircraft. It served this initial regular commuter route between Princeville and Honolulu primarily for Princeville Resort guests. The airline then expanded its interisland routes with service to Hana, Maui; Hoolehua, Molokai; Kahului, Maui; Kamuela, Hawaii (Big Island); Kapalua, Maui (West Maui) and Lanai City, Lanai. The Princeville Airways fleet consisted of eight DHC-6 Twin Otter aircraft.

Aloha IslandAir

In May 1987, Consolidated Oil and Gas sold Princeville Airways to Aloha Air Group, the parent company of Aloha Airlines. Princeville Airways was renamed Aloha IslandAir and served the growing inter-island commuter needs for Aloha Airlines on route services that could not accommodate larger Boeing 737 jetliners. In June 1992, Aloha IslandAir registered the name Island Air as its trade name. In 1995, newly renamed Island Air was granted certification by the Federal Aviation Administration to operate larger aircraft to serve the burgeoning commuter market in Hawaii. In April of that year, Island Air took possession of its first thirty-seven seat De Havilland Canada Dash 8 aircraft.

Ownership under Gavarnie Holding, LLC

In December 2003, it was announced that Gavarnie Holding, LLC would purchase Aloha IslandAir from the Aloha AirGroup, making Island Air Hawaii's third largest independent airline. The purchase was completed on May 11, 2004, and the company was renamed Hawaii Island Air, Inc., although the airline continued to do business as "Island Air". After the purchase, Island Air expanded its business, acquiring more aircraft and flying new routes.

In May 2008, Island Air was awarded Essential Air Service routes from Kansas City International Airport to Joplin, Missouri, Grand Island, Nebraska, Harrison, Arkansas, and Hot Springs, Arkansas but did not announce specific starting dates. The following month, however, the airline withdrew from its contract after concluding that a mid-September startup date was unrealistic, citing staffing and fuel costs.

On August 17, 2009, Island Air discontinued all service to Hilo.

In 2012, as the Dash 8 fleet began to approach their useful cycle life, the airline reached out to PenAir of Alaska and wet leased a single Saab 340 for 10 months.

On July 19, 2012, Island Air revealed a new business model which included a complete image and brand overhaul. This coincided with the arrival of the airline's new ATR fleet of turboprop aircraft in August. The airline also unveiled a new website to go alongside its new brand and image launch.

On October 4, 2012, Les Murashige was appointed as the company's new President and CEO replacing Lesley Kaneshiro.

Ownership under Ohana Airline Holdings, LLC

On January 10, 2013, Island Air announced that the company would be sold to an undisclosed buyer.

On January 18, 2013, Oracle Corporation CEO Larry Ellison, who had recently acquired most of the island of Lanai from David H. Murdock, was reported to be the buyer, though this was not confirmed by the airline at the time.

On February 26, 2013, the sale to Ellison was complete. That same day, the airline certified its first ATR 72, which would go into service the following day. Ellison appointed Paul Casey, former CEO of Hawaiian Airlines and President of the Hawaii Visitors and Convention Bureau as the company's new President and CEO.

On May 31, 2013, Island Air ended service to Kapalua/West Maui Airport, as a result of phasing out the airline's Dash 8 aircraft and the ATR 72's inability to land at the airport's short runway. In conjunction, service was resumed to Kahului, Maui on April 15, 2013.

In 2014, Island Air discontinued service to Ho'olehua, Molokai.

On September 3, 2014, Island Air appointed David Pflieger, president and chief executive officer of Ft. Lauderdale, Fla.-based Silver Airways to assume the roles of president and chief executive officer. Effective October 1, 2014, Pflieger will become the airline's new president and CEO, replacing Paul Casey who will assume an advisory role with the airline. Prior to Silver, Pflieger led the highly successful turnaround at Fiji Airways and was a former Virgin America and Delta Air Lines senior executive.

In December, 2014, the airline announced that due to six quarters of prior losses under previous management, it was putting delivery of new Q400 aircraft on hold and undertaking a comprehensive re-assessment of its fleet, network, and other aspects of its business.

On April 29, 2015, Island Air announced it would be eliminating Honolulu service to Kauai beginning June 1 and reducing daily frequency by more than half on its Lanai route starting on that date. The airline also announced it will be cutting its workforce by 20 percent as well as canceling delivery of new aircraft in the short term as the airline works to reposition itself as the second largest carrier in the islands. These changes come after the company cited record financial losses of more than $21 million last year alone.

In September, 2015, Island Air began voluntarily reporting its much improved monthly and quarterly on-time performance and flight completion factor (80.4% and 99.2% respectively) so that current and potential customers can see how the airline is performing as it continues to improve and position itself for a strong future as Hawaii’s alternative inter island airline.

On January 7, 2016, Larry Ellison's Ohana Airline Holdings, LLC announced that it planned to sell a controlling interest in Island Air to PaCap Aviation Finance and Malama Investments, two investment companies managed by local investment firm, PacifiCap.

On February 8, 2016, following the formal approval of the transfer in ownership by the U.S. Department of Transportation, it was announced that Dave Pflieger, who joined as CEO in October 2014 and presided over its successful restructuring, turnaround, and sale, would be leaving Island Air to work directly for Ellison in an unspecified role and turning the reins back over to Les Murashige, a former Island Air executive, who would become President and CEO under the airline’s new owners, PacifiCap LLC.

Ownership under PacifiCap

On January 21, 2016, Island Air announced plans to restore service to Kauai beginning on March 15 after suspending flights in June 2015 due to restructuring. The airline stated that approximately 32 airport-related jobs will be created and hinted that expansion aren't done yet with hopes to re-enter other destinations that Island Air previously served.

Island Air ended service to Lanai on March 31, 2016.

On April 14, 2016, Island Air announced its plans to restart service between Honolulu and Kona starting June 14 with five daily round-trip flights. The last time Island Air served Kona was in December 2012. This service restoration is estimated to create 25 new airport-related jobs. Island Air president and CEO Les Murashige stated that Hilo is also being evaluated.

On April 26, 2016, Island Air's CEO Les Murashige and COO Rob Mauracher stepped down from their posts. This is the second time in two months that Island Air has experienced a reshuffling of their senior management team. Shortly thereafter, Island Air named David Uchiyama as its new President and CEO.

Destinations

All destinations served by Island Air are in the state of Hawaii in the United States. The following destinations are served:

Fleet

The Island Air fleet includes the following aircraft (as of January 2016)

The airline took delivery of a Bombardier Q400 (N539DS) in March 2006 and on a five-year lease. In September 2006, the airline announced that it was withdrawing the aircraft from inter-island service the following month, with delivery of two Q400s rescheduled to 2007. The airline has since returned all Q400 aircraft and has no plans to return these aircraft to service.

Aviation Week & Space Technology reported on May 19, 2011, that the airline was looking to add one or two additional Dash 8 aircraft, and was also discussing new aircraft options with ATR, Fokker, Saab, and SuperJet International. The airline announced in late February 2012 that it had reached an agreement to lease six ATR 72 aircraft, along with a Saab 340 wet leased from PenAir. The airline stated in July 2012 that deliveries of ATR 42 and ATR 72 aircraft would begin the following month.

After acquiring the ATR 72 aircraft, Island Air found them to be unreliable to the point that the airline was reviewing potential replacements as of September 2013. On March 31, 2014, Island Air placed firm orders for two Bombardier Dash 8 Q400 with the intention of replacing ATR 72 with Q400.

Due to record financial losses of more than $21 million, on April 29, 2015, Island Air announced its intention to cancel the delivery of new Bombardier Dash 8 Q400 aircraft in the short term as the airline works to reposition itself as the second largest carrier in the islands.

Accidents and incidents

On October 28, 1989, a de Havilland Canada DHC-6 Twin Otter operating Aloha IslandAir Flight 1712 crashed into a mountainous terrain. The crash killed all 20 people on board. The National Transportation Safety Board determined that the probable cause of this accident was the airplane's controlled flight into terrain as a result of the decision of the captain to continue flight under visual flight rules at night into instrument meteorological conditions, which obscured rising mountainous terrain.

Island Miles

Island Miles (formerly Cloud 9) is the travel rewards program of Island Air. The program's airline partners include Star Alliance member United Airlines. Island Air also has an interline agreement with American Airlines. Aloha Airlines was formerly an airline partner until it discontinued passenger operations.

The Island Miles program has no membership fee and any flight credits will be valid for 3 years following the date of the flight. Island Miles accounts which do not earn any flight credits for two years can be placed on "inactive status" and any credits on the account would be forfeited. After six flight segments a one-way award ticket is credited to the member, and after 12 flight credits, a round trip award ticket.