Island Air Flies Today for the Last Time

Island Air is shutting down at the end of the day today.

After 37 years of service in Hawai‘i, Island Air is shutting down operations at the end of the day, blaming “legal pressure impose by aircraft lessors,” according to a company’s new release Thursday.

Founded in 1980 as Princeville Airways, the company was renamed Island Air in 1992. On its website, the company posted a brief message thanking its customers and directing them to contact their credit card companies for inquiries on refunds.

Earlier this month, Island Air was “forced to file for Chapter 11 bankruptcy protection in an effort to continue operations following threats of legal action by the Lessors of Island Air’s aircraft to ground and repossess the company’s fleet. Island Air was unable to locate a new investor or lender to provide funding to support airline flight operations and a successful reorganization,” according to the news release Thursday.

One of the difficulties of attracting new investors, the release states, was the “aggressive legal attacks” by lessors Wells Fargo Bank Northwest, N.A. and Elix 8 Ltd.

Although Lessors’ Motion for Temporary Restraining Order was denied by Judge Robert Faris of the District of Hawai‘i Bankruptcy Court on Nov. 3, lessors continued to engage in “multi-directional legal attacks which Island Air could no longer combat without additional financing,” the company states. The aircraft lessors were seeking termination of all leases and immediate repossession of all aircraft.

“Island Air has taken every measure possible to avoid this tremendous hardship to its passengers,” said David Uchiyama, Island Air president and CEO. “Island Air appreciates the loyalty and support its customers, management, employees, and vendors have shown the airline, especially during the last few weeks of this bankruptcy process. Island Air is proud of its 37-year history of service to the State of Hawai‘i.”

In the brief message on its website, the company posted the number 1 (800) 652-6541 for questions and concerns.