Hawaii’s Island Air files for Chapter 11 bankruptcy protection

Hawaiian inter-island regional carrier Island Air filed for Chapter 11 bankruptcy protection Oct. 16, in what the carrier called “an effort to continue normal operations while navigating through legal challenges recently presented by the lessors of its aircraft.” Island Air said it had been in the process of negotiating its aircraft leases with its lessors, when “on Oct. 12 … Island Air was very surprised that the lessors served them with notices of termination of the leases and demands to surrender its airplanes.” “The bankruptcy filing was caused by threats of legal action to ground the aircraft and strand hundreds of passengers,” Island Air said. “The filing prevents the threatened action and allows Island Air to continue interisland service for its customers … continuing to operate under the protection of the US Bankruptcy Court will allow Island Air to maintain its service to its customers, provide continued employment to its more than 400 employees and ensure a revenue stream so its vendors are paid.” Island Air’s all-leased operating fleet comprises five 78-seat Bombardier Q400 turboprops. Three of the Q400s are leased from Elix Aviation Capital.<br/>