Island Air started small — at the airports others ignored - Hawaii News Now - KGMB and KHNL

Island Air started small — at the airports others ignored

(Image: Island Air) (Image: Island Air)
HONOLULU (HawaiiNewsNow) -

Island Air got off to a humble start in 1980 as Princeville Airways, with scheduled flights between Honolulu and Kauai's Princeville Resort.

It started adding smaller airports that Hawaiian and Aloha airlines ignored.

"They did blaze a lot of new routes in the islands and that offered a tremendous amount of convenience," said aviation expert Rick Forman.

Seven years later, Aloha Airlines's parent company bought the carrier, renamed it Aloha Island Air and further expanded its daily schedule.

When Aloha sold the carrier to an investment group in 2004, it was Hawaii's third biggest airline.

Island Air acquired larger aircraft and doubled its staff to about 400 employees to compete directly with Aloha and Hawaiian Air.

"Once they got the bigger airlines, I think basically, their business model became very difficult," Forman said.

Four years ago, after buying Lanai, Oracle billionaire Larry Ellison acquired Island Air as a way to get more visitors to his hotels.

But mounting losses prompted Ellison to sell his shares to venture capitalist Jeffrey Au last year. The company filed for bankruptcy reorganization last month.

Island Air outlasted Aloha Air, Mid-Pacific Air, Mahalo Air, Discovery Airways and even Phoenix-based go! Airlines.

But after 37 years, it couldn't pay the bills on its new Q400 planes. And now, Island Air is flying into history, too.

Copyright 2017 Hawaii News Now. All rights reserved. 

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