What Really Killed Aloha?
The long answer may be simple: Us
(page 2 of 4)
Such are the complexities and realities of running an airline in a small, isolated market like Hawaii. In the wake of Aloha Airlines’ sudden and painful demise last March, it is also a source of continual frustration for insiders like Cutwright, who know the nuts and screwy bolts of the airline industry and the vagaries of the interisland market — a place where the public need and the free market are often on a collision course.
With accusatory fingers raised, the media, the public and their elected leaders have asked how 61-year-old Aloha could have gone out of business? How could it have happened so quickly? Who was to blame?
The short answers to these questions are fairly easy, the dots simple to connect: high fuel prices, a competitor with insider information and very deep pockets and an aged fleet of aircraft that guzzled gas. However, the longer answer to what ultimately did in Aloha is a little more complicated and may hit closer to home.
“Will the public come to a better understanding about what led to Aloha’s demise? No, I don’t think so,” says Cutwright, answering her own rhetorical question. “There’s just too much about this business that resists simple answers. However, anyone who knows that one-plus-one equals two should have known that in the long run, what was happening was not sustainable. Aloha said just that for the past couple of years, but no one heard it.”
On an early May morning, Aloha Airlines’ corporate offices in Waterfront Plaza are eerily quiet. With dozens of workspaces seemingly frozen in time — books, files and folders still neatly stacked in bookcases and inboxes and outboxes still full of documents — the place looks and feels like a scene from a science-fiction movie in which an entire population suddenly vanishes. The reality is more grim and chilling: It’s the empty shell of a company that suddenly went out of business and sent everyone home.
Today, the sprawling office is occupied by just three people, one of whom is Aloha Airlines’ president and CEO, David Banmiller, who is still doing business and meeting people although emptiness and quiet surrounds him. But Banmiller is anything but quiet today. He’s telling the story of his airlines’ recent struggle, one that he has told to dozens of people over the past several years: fellow airline CEOs, airline regulators, lenders, state and federal officials, local business leaders and editorial boards. Even though Aloha’s story has come to an end, he’s coming out swinging like a prizefighter who has finally been allowed to enter the ring. He’s hoping that people will listen to his fighting words this time.
“Everything that we said, unfortunately, came out true. We told people that 3,500 jobs were at stake, and we had someone here whose sole mission was to put a company out of business,” says Banmiller. “We said that if we shut down there would be a major impact and there was, especially when we shut down cargo. But no one listened. There was this belief that Aloha had been around for 61 years and it would never not be around.”
Banmiller’s three-and-a-half-year tenure as head of Aloha has been nothing but a fight. When he first met with airline officials in November 2004 about possibly taking over the top spot, the veteran airline executive asked to take a look at the company’s financials — budgets, cashflow and capital plans, “Economics 101 stuff.”
“Why? It doesn’t matter,” was the response. “There is no money.”
Do you like what you read? Subscribe to Hawaii Business Magazine »