Billionaire Larry Ellison's purchase of Island Air and his interest in go! airlines has garnered most of the headlines in recent months but flying under the radar has been Mokulele Airlines, which has been growing and expanding its reach and operations.
The commuter airline, which flies nine-seater Cessna Grand Caravans, announced Monday that it will offer two round trips daily between Kona International Airport and Kapalua West Maui Airport, beginning July 19.
Mokulele President and Chief Executive Officer Ron Hansen also announced that the airline has been awarded the federal Essential Air Service contract to Waimea-Kohala Airport in Kamuela on the Big Island and will begin flying two round trips per day between Kamuela and Kahului Airport beginning Sept. 21.
The airline has purchased four new airplanes in the last four months - nearly doubling its fleet to nine aircraft - to accommodate the growth of the airline, he said. One new plane was expected to arrive at the airline's home base in Kona on Tuesday after a 14-hour flight from California and the last new plane is expected in Kona on July 25.
"Business has been good," said Hansen, saying that most of Mokulele's flights are 80 percent full.
By the end of August, he expects the flight schedule to grow to 120 flights daily, up from 80 flights in May, he said. Two years ago, when he took over the airline, Mokulele carried 7,000 passengers per month; that will grow to 20,000 by the end of the August, he said.
With the addition of Kamuela, the airline will serve eight airports in Hawaii, the others being Kona, Kahului, Kapalua West Maui, Hana, Lanai City, Hoolehua on Molokai and Honolulu.
The decision to try the Kapalua-Kona route, which "nobody has ever done . . . before," arose out of observing the habits of passengers on Mokulele's Kona-Kahului flights, Hansen said.
"A lot of passengers are driving from Kahului to West Maui," he said. "That's why we think there could be a market."
Mokulele will be offering a morning and an afternoon flight, two round-trip flights a day.
To celebrate the new route, the airline is offering an introductory rate of $59 one way, including taxes and fees, for reservations made for flights between Kona and Kapalua booked by Monday.
The Kamuela-Kahului U.S. Department of Transportation Essential Air Carrier selection of Mokulele Airlines was made July 2. The program was established to guarantee that small communities that were served by certified air carriers before deregulation in 1978 would continue to receive a minimal level of scheduled air service. Because these routes are generally not profitable, the designated airlines receives a federal subsidy.
Mokulele received a four-year subsidy, totaling more than $1.7 million for Kamuela, according to Transportation Department documents.
The contract was open because the previous Essential Air Carrier, Pacific Wings gave notice in March of its intent to terminate its service to Kamuela. Mokulele was awarded the contract over Makani Kai airline, which has the Essential Air Service contract for Kalaupapa, Mokulele will be providing 24 flights a week between Kahului and Kamuela with an average fare of about $63 a trip, according to the Mokulele proposal.
"We hope that it will be successful," said Hansen. "We are very excited about it.
Mokulele began flying in Hawaii in 1994 and was purchased by TransPac Aviation Inc. in 2011. According to its federal filing, the airline has 70 full-time and 30 part-time employees.
There has been a lot of activity of late in the Hawaii airline market with Ellison, who purchased most of Lanai last year, buying Island Air and eyeing go!, according to reports. Hawaiian Airlines' commuter service, 'Ohana, with its 48-passenger twin-turboprop ATR42, is expected to debut soon.
Hansen has been an observer of the interisland airline wars for the past five decades.
"It's always been that way," he said. "There are a lot airline carcasses along the route. . . . I can't even begin to count the numbers.
"I am hoping that things will stabilize."
Like Ellison, Hansen said he believes that the secret to success in the Hawaii airline market is to provide good and dependable service at a fair price.
"We all want to be survivors," he said.
* Lee Imada can be reached at email@example.com.
* This article includes a correction from the original published on Wednesday, July 10, 2013.