Southwest Airlines announced yesterday that it plans to begin selling tickets for service to Hawaii in 2018. The low-cost carrier has also announced intentions to apply to the Federal Aviation Administration (FAA) for Extended Range Twin Engine Operational Performance Standards (ETOPS).

“We’re thrilled to bring Hawaii next year as an option to more than 115 million customers who already fly with us annually,” said Mike Van de Ven, Chief Operating Officer at Southwest. “The launch of our ETOPS work begins the next chapter of Southwest Airlines.”

“A day long-awaited by our customers, fans, and more than 55,000 of the world’s most-loved airline employees is finally within sight–a day that will showcase your hospitality, about as far southwest as you can go in the US,” Southwest Chairman and CEO Gary Kelly said. “Hawaii is an important place for Southwest Airlines because so many people count on us to take them everywhere they want to go reliably and affordably. We’re ready and excited to address a request we’ve heard for years.”

Southwest has yet to announce any exact pricing or routes. The airline has said, however, that it will most likely launch service from the west coast, specifically California. The airline is also considering the possibility of inter-island flights, which would hurt carriers like Hawaiian Airlines, Island Air, Mokulele Airlines, and Makani Kai Air.

Southwest President Tom Nealon and Hawaiian Governor David Ige made the announcement via satellite to an estimated 10,000 Southwest employees at a company part in Los Angeles.

“The unmatched combination of our people and low fares with nothing to hide will be a game changer in the US to Hawaii market,” Nealson said.

This is a move that passengers have been speculating about for years. Southwest’s decision to fly to America’s only island state could bring down ticket prices across the industry.

“On average, our fares will be lower than [the competitor’s] or bring down the market price. Low costs come from very efficient operations. We pay our people well, but we work them hard and we work the airplanes hard. So that leads to low costs so we have lower than our competitors so we’ll be able to bring lower ticket prices,” said Andrew Watterson, Southwest’s Executive Vice President. “One hundred and seventy-five seats in a 737-800 is a different scale of economy and we can keep costs low by higher efficiencies.”

SWA is known for all-economy planes with open seating. Photo Source: Eric Salard / Wikimedia Commons

“In our opinion, the most important impact of the Southwest Effect in Hawaii is that it tends to lead to a dramatic reduction in fares, given that we believe travel demand to Hawaii is relatively inelastic (so passengers are unlikely to increase much),” said financial website Seeking Alpha. The website predicts that Southwest could “easily add at least 10 daily flights to Hawaii, to start with.”

CNBC reports, however, that demand for travel to Hawaii is increasing. The news outlet reports that the state had 8.9 million visitors last year, which is a record. CNBC also says that Hawaii has seen a 5% increase in visitors over the first eight months of this year.

In addition, some analysts say that Southwest’s introduction to the market won’t actually reduce prices, or at least not by much. This is because it costs more to operate Southwest’s aircraft per mile than it does to operate the larger aircraft flown by carriers like Hawaiian Airlines.

Southwest will use its new Boeing 737 MAX8 on the route, as the aircraft has a range 500 miles farther than its 737-800s. However, before it can actually fly the route, it must gain ETOPS certification for the planes, which is something it has not yet done. Southwest became the first American operator of the MAX 8 when it took delivery of the aircraft in August. Nine MAX 8s were delivered to the airline on October 1, and the airline will have a total of 14 by the end of the year.

Watterson said that Southwest was purposefully ambiguous about the start date of the route because it will depend on when ETOPS certification is received.

“We wouldn’t be so bold as to say we’ll start flying in October or November or July of 2018 and not go through the FAA process,” Watterson said. “We know we’ll go through the FAA process in time to sell tickets next year, but until the FAA gives us better indications of the authorization timeline, we’re not going to speculate and put a date out there. This has been a long time coming so there’s no particular reason for us to rush it. For us, it’s more important to do it properly than doing it a certain date.”

Southwest isn’t the only American no-frills airline considering long routes. JetBlue, a New York-based competitor, has considered flying to Europe with Airbus planes sized similarly to the MAX 8.

ETOPS is a certification that determines how far an aircraft can safely be away from what is known as a diversion airport (an airport that an airline can safely divert to) in the case of a single-engine failure. ETOPS certified planes require additional equipment and specialized crew members specially trained in responding to emergencies.

This is a developing story. Please check back on Layoverhub when new details are released.

Featured image by Joe Mabel / Wikimedia Commons

Categories: Industry Talk

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Southwest Airlines announces plans to serve Hawaii

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