Hawaiian Airlines Shifts Focus to U.S. Market Amid Japan Challenges
Hawaiian Airlines is pivoting its focus toward the U.S. market in response to declining demand from Japan, its largest international market, due to the yen’s depreciation against the U.S. dollar.
Peter Ingram, CEO of Hawaiian Airlines, discussed this strategy during the airline’s second-quarter earnings call, stating that the weakened yen has reduced revenue from Japan. “International demand, particularly from Japan, remains below historical levels,” Ingram noted. “To compensate, we are intensifying our focus on the U.S. market.”
The drop in yen value has made U.S. travel more expensive for Japanese tourists, prompting Hawaiian Airlines to adjust its capacity from international to domestic routes. Ingram highlighted the success of new flights between Hawaii and mainland U.S. cities, including routes from Salt Lake City to Honolulu and new services from Sacramento to Kona and Lihue.
The airline has also overcome previous challenges related to shortages of Airbus A321neo engines. Ingram reported that the fleet has been fully operational since Memorial Day and is expected to remain so through 2025.
Chief Revenue Officer Brent Overbeek expressed optimism about the performance of new domestic routes and noted stability in North American operations, despite the slow recovery of the Maui market following the 2023 wildfires. Although the yen exchange rate continues to be a challenge, Overbeek acknowledged a strong affinity among Japanese consumers for Hawaii.
Currently, Hawaiian Airlines operates four routes from Honolulu to Japan: double-daily flights to Tokyo Haneda, daily flights to Tokyo Narita and Osaka Kansai, and three weekly flights to Fukuoka. The airline offers approximately 17,000 weekly seats between Hawaii and Japan, a decrease from 19,200 seats in 2019.
Earlier this year, Hawaiian Airlines returned seven nighttime slot pairs at Tokyo Haneda, citing ongoing challenges in the Japan-Hawaii market.
Despite these challenges, All Nippon Airways (ANA) has reported record-high quarterly revenue, driven by increasing inbound tourism and outbound business travel. ANA plans to add new routes to Istanbul, Milan, and Stockholm this winter.
Hawaiian Holdings Inc., the parent company of Hawaiian Airlines, reported $732 million in operating revenues for the quarter ending June 30, a 3.5% increase from the previous year. However, operating losses widened to $55.4 million compared to $9.6 million in the same period last year. The airline is also awaiting approval for a proposed $1.9 billion merger with Alaska Airlines.