Hawaiian Airlines, Inc. (AMEX and PCX: HA) recently announced that it will join most other U.S. airlines in eliminating all paper tickets from its distribution system in 2003. The airline already defaults to electronic ticketing for all direct reservations and sales and is positioning itself to offer customers higher levels of convenience and value through greater use of available technology.
Consistent with other carriers that have converted to ticketless operations, Hawaiian will continue to offer paper tickets upon request for a fee of $25.00.
In its operations within Hawaii, the change will mean an end to Hawaiian’s production and distribution of interisland flight “coupons” effective Monday, January 6, 2003 and reliance on established published fares, which start at levels below the current market price for coupons. Existing coupons will continue to be honored.
John W. Adams, chairman and CEO, said, “As airlines seek every possible way to become more efficient, electronic distribution and processing is becoming the norm and a necessity. It streamlines processes for the airlines, and travelers have come to expect the time-saving conveniences of ticketless travel, such as instant online booking and ticketing, automated airport services and the peace of mind in not having to store or carry paper tickets.”
Hawaiian has already nearly completed the elimination of paper tickets in its U.S. mainland and South Pacific operations and was considering an expansion of the process to its interisland operations later this year. Adams said the company is accelerating its conversion to ticketless travel on interisland flights in an effort to achieve financial viability for the high-frequency service that island communities need.
“The problem of financial sustainability in the interisland air transportation system has become urgent,” Adams said. “In the midst of the worst economic crisis our industry has ever seen, we are working to achieve a delicate balance between providing the services our island communities need and protecting our financial stability as a provider of those services.
“Coupons are the legacy of another era in Hawaii, when local carriers used them to build marketshare and raise cash, but they’ve outlived their purpose. The trouble is, that system has never produced profits in the interisland market and, in everyone’s best interest, the time has come for us to change that.
“In order to preserve high-frequency air service throughout the state, we need to make these operations economically sustainable. Converting to electronic ticketing will go a long way to achieving sustainability by increasing our operational efficiency and allowing us to better manage our inventory,” Adams said. “Most importantly, e-ticketing is easy for every customer to use, whether they book online or by calling their travel agent or our Reservations department.”
Hawaiian’s current published fare structure for interisland travel offers an unrestricted electronic alternative to coupons at a comparable price, while providing lower prices to customers who book as little as three days in advance.
Hawaiian’s published interisland fares start at $66 (all taxes and fees included) for ticketing at least seven days prior to departure and $70 if purchased at least three days before departure—both comparing favorably to the prevailing “street” price of coupons at $72.00. Hawaiian’s unrestricted, no-advance-purchase fare good for any available coach seat on most routes is $75. Fares for travel to and from Lanai and Molokai, as well as all two-segment connecting flights are $17.50 higher, consistent with higher costs associated with providing these services.
Hawaiian has invested millions of dollars in recent years to upgrade its technology infrastructure and is now poised to take advantage of opportunities to improve its customer experience by automating certain services and introducing new conveniences. The airline has installed eight new self-service check-in kiosks at its Honolulu terminal, and plans to install kiosks at all of its airport locations in Hawaii in the next six months.
In addition, later this year Hawaiian plans to introduce new technology that will allow customers to check in for flights from home or office before heading to the airport, as well as a new debit card that allows frequent flyers to “bank” and use flights the way a phone card banks minutes.
“Migrating to the electronic environment will allow us to make significant improvements to customer service and convenience. These technological advancements will free our people from tasks machines can do to focus on those things machines can’t do, like fulfilling the promise of our new service motto, ‘Hawaii Starts Here,’” Adams said.
Founded in Honolulu 73 years ago, Hawaiian Airlines is Hawaii’s longest-serving and largest airline. The nation’s 12th largest airline, it is also the second-largest provider of passenger service between the West Coast and Hawaii.
The airline has earned numerous international awards for service in recent years, including the 2001 Zagat Survey’s award for Best Overall U.S. Airline in the Premier category, and the 2001 Diamond Award for In-Flight Service from Onboard Services magazine. Hawaiian was rated third highest in Travel & Leisure magazine’s most recent ranking of the Top 10 U.S. Airlines.