In the third such deal in which it provides financing to a capacity purchase partner, Republic Airways Holdings is going into the Hawaiian market as previously reported in a deal that injects $8 million in direct financing to Mokulele Airlines. The company previously provided $27.5 million in financing to Frontier and Midwest airlines. Related Story Republic Airways Holdings Inc.’s Shuttle America subsidiary will operate four, 70-seat Embraer 170 jets under a 10-year capacity-purchase agreement beginning Nov. 19. The aircraft, already pictured on Mokolele’s web site, will connect Honolulu to both Kona and Lihu’e,
The move is the second code-share operation for Mokulele which will continue to use its seven Cessna Caravan fleet to operate as go! express, Mokulele Airlines CEO Bill Boyer told Regional Aviation News, adding that the jets were not part of the go! Express agreement and will be marketed and sold as Mokulele Airlines with the Mokulele Airlines code (MW). Mokulele uses the Cessna Caravan 208 be to operates 56 daily departures to seven cities in Hawaii.
"As a local Hawaiian airline that has been serving the island since 1997, we are grateful for the significant support we received from our local business and resort communities, which is making this expansion possible,” said Boyer, who told RAN that demand has shown a need for increased flights since the demise of Aloha. “The 70-seat Embraer 170 jet is the perfect plane and comes at the perfect time to satisfy current inter-island air-travel demand."
Mokulele Airlines will schedule, price, distribute and promote all of its flights, including those operated by Shuttle America. The move provides new competition to the go! and Hawaiian inter-island operations and offers 70-seat jets, in a six/64, business/economy configuration, to go!’s 50-seat CRJ 200s. The financing package is in the form of a line of credit which can be converted at Republic’s option to a maximum 45 percent of Mokulele’s common stock.
Mokulele is purchasing all the capacity of the four jets at predetermined rates and will directly pre-pay or reimburse Republic for industry standard pass-through costs, including fuel. The first two aircraft will launch service November 19 with the second set for a spring introduction. The new service opens up employment opportunities for those laid off when both Aloha and ATA airlines ceased operations earlier this year, according to Boyer.
Mokulele Airlines is a locally owned and operated inter-island commuter airlines based in Kailua-Kona, Hawai’i. Founded in 1998 as Mokulele Flight Service Inc, it was acquired by boyer in 2005.
"We look forward to bringing our dependable, award-winning service to the beautiful islands of Hawai'i, and we are especially pleased to be partnering with Hawai'i's locally owned Mokulele Airlines," said Bryan Bedford, chair, president and CEO of Republic Airways. "Mokulele's passengers are sure to enjoy the spacious,