Wednesday, April 30, 2008
Tuesday, April 29, 2008
Posted on: Tuesday, April 29, 2008
"Hawaii loses 85% of air cargo capability"
By Rick Daysog Advertiser Staff Writer
"...Aloha abruptly closed its profitable air freight business yesterday after its lender, GMAC Commercial Finance LLC, cut off financing...The impact will be felt by retailers and wholesalers of time-sensitive consumer items such as baked goods, produce, meat, medical supplies, newspapers, auto parts and construction materials. The move also will affect movement of interisland mail and the flow of cash between local banks and their Neighbor Island branches...
James Wagner, Jupiter's attorney, said the company was prepared to go through with its purchase as recently as yesterday afternoon. But GMAC unexpectedly upped the price to $15 million and required a higher deposit, he said..."This all has to do with other parties changing the deal without any warning," Wagner said. "I've been in practice over 30 years and I've never seen a case end like this."
...Paul Brewbaker, chief economist at the Bank of Hawaii, said it may be some time before competing carriers and cargo operators fill the void left by Aloha. 'This is huge,' said Brewbaker. 'I don't doubt that somebody will come in and fill the void but in the short-term, anyone who wants to go to market is hung up.' Aloha used six Boeing 737-200 planes solely for interisland cargo."
Posted on: Tuesday, April 29, 2008
"Neighbor Isle businesses worried about impact;
Now, farmers, grocers are uncertain who will carry perishable items"
By Christie Wilson, Diana Leone and Kevin Dayton Advertiser Neighbor Island reporters
"Neighbor Island farmers and grocers who depended on Aloha Airlines cargo to either fly out or fly in perishable items say they will be badly hurt by the carrier's closing...
Owner Teena Rasmussen, who runs the 30-year-old business with her husband, Craig, said the farm sends out 30,000 to 40,000 tuberoses, orchids, carnations and other flowers a week. "You've got to be kidding," she said, upon hearing the news of Aloha cargo's shutdown...
Aloha offered nighttime cargo flights and daily office hours at its cargo site at Kahului Airport, conveniences not offered by Hawaiian, Rasmussen said. "The problem to me is that Hawaiian doesn't have the staffing in its cargo offices to handle the volume, and they don't run night freighters or have hours seven days a week," she said...
The Hawaii Superferry is not an option for Paradise Flower Farms because drivers are required to accompany their delivery trucks and the Maui farm does not have its own delivery system on the other islands. In addition, the Superferry so far only serves Maui and O'ahu, and the farm has customers on Kaua'i and the Big Island.
Aloha cargo's shutdown also hurts grocers who were flying in fruit and vegetables from O'ahu.
Esaki's Produce on Kaua'i typically flies in produce daily from Honolulu, said general manager Earl Kashiwagi. "This week, we had no guarantees they were flying after Sunday.
"We'll have to switch some things from air to barge," he said, and since the Young Brothers barges arrive on Kaua'i on Tuesdays and Fridays, "it's the middle of the week that will be pilikia." "The chefs will have to plan," Kashiwagi said. With air cargo shipments, "they can order stuff right now (in late afternoon) and get it tomorrow morning." Before the late 1980s, there was no air cargo service to Kaua'i, he recalled. "Before the governor does anything else, I'd think they'd see if they can get a third barge in," Kashiwagi said.
Even if the Superferry were running to Kaua'i, it wouldn't be a viable alternative for Esaki's Produce, Kashiwagi said, because Esaki's delivery trucks aren't large enough to handle the amount of produce needed. "Plus we'd have to have somebody onboard (Superferry) to drive the truck, a guy that's not going to get seasick," he added.
At least one Big Island farmer saw trouble brewing and shifted his Aloha cargo shipments to barge last week. Hamakua farmer Richard Ha ships several million pounds of tomatoes a year plus cucumbers and other vegetables from his Hamakua Springs County Farms. Some crops came to O'ahu by barge, and other shipments went to Maui on Aloha's cargo jets. Last week, Ha stopped using Aloha, opting instead to send two shipments a week by barge...
Kaua'i florist and flower grower Haunani Pacheco said she worries that her business, Hawaiian Paradise Flowers, might have to pay up to four times what it had paid Aloha for weekly air cargo shipments from the Big Island...Even if another air carrier comes into the market, they are likely to charge higher prices, Pacheco said. She said she has reduced the number of anthuriums, orchids and other tropical flowers she grows on her Kaua'i farm because flying them from Hilo has been cheaper. It would take her about a year to resume larger flower crops on Kaua'i, she said. In the meantime, she'll have to ship with FedEx or UPS at higher prices and without the refrigeration offered by Aloha, Pacheco said. She said the Superferry wouldn't help. Since her flower sources are on Maui and the Big Island, two ferry trips without refrigeration just wouldn't work, she said.
Bob Williams, president of the Hawai'i Island Chamber of Commerce, said Big Island farmers who ship fresh fruit, vegetables and flowers to O'ahu stores and restaurants will be most affected..."
Posted on: Tuesday, April 29, 2008
"Hawaii bakery ships interisland via L.A."
By Greg Wiles Advertiser Staff Writer
"Love's Bakery, thrown into a tailspin by the sudden shutdown of Aloha Airlines' cargo unit, is going the distance to make sure its customers on the Big Island and Kaua'i get their baked goods. After learning that Aloha wouldn't be flying cargo last night and not having other options for interisland cargo flights, Love's made arrangements with Surefire Consulting to ship the baked goods on flights to Los Angeles where they could be loaded back on to other commercial passenger planes headed directly to Neighbor Island airports...
Love's was Aloha's biggest customer, shipping an average of 36,000 pounds of baked goods daily. Aloha also carried the bulk of mail sent between the Big Island, Maui and Honolulu. Another smaller carrier also delivers mail, including to Kaua'i. Late yesterday the U.S. Postal Service said it was hoping to put its emergency plans into place seamlessly so that customers would not notice a service disruption...
Suzuki said while Hawaiian Airlines is being eyed as a possible solution, its Boeing 717 passenger jets can only carry a limited amount of freight and shippers need to pass a security check. Hawaiian is also operating a larger Boeing 767 for Maui flights, but it is unknown how long the carrier will continue to schedule that flight and its added cargo capacity, Suzuki said...
Suzuki said yesterday Hawaiian Airlines stopped accepting cargo before 7 p.m. and that he was wondering what to do with a 300-pound pallet of freight for the Big Island. Among his ideas was a solution similar to Love's — sending the shipment to the West Coast on United Airlines where it could be loaded onto the carrier's flight to Kona...
Suzuki said a trucking company was making plans to start shipping four 40-foot containers each day on the Superferry and pledging to have Maui deliveries done on a same-day basis.
While there was much focus on Honolulu shippers getting cargo to Neighbor Island customers, there also were questions about how Hawai'i's cut flower and ornamental plants business would fare with shipments into O'ahu. Similarly, Neighbor Island growers of fruits and vegetables availed themselves of Aloha's overnight flights to get their produce to Honolulu...
Watanabe Floral, one of the state's bigger floral businesses, said it uses Hawaiian for shipments of roses from its Big Island farm...
At Big Island-based Pacific Floral Exchange, that meant putting more shipments on to direct flights to the Mainland, even if it entailed trucking the flowers to Kona so they could be sent out.
...Inouye, who ships about 10,000 pounds of flowers and plants weekly, said he needs to get products to customers within two days, whether that be in Honolulu or somewhere on the Mainland. Therefore, using interisland barge service provided by Young Brothers Ltd. wouldn't suffice, he said.
Love's has been looking at Young Brothers for its Big Island and Kaua'i shipments as part of its contingency planning. It had begun shipping its goods to Maui on the Superferry on Sunday.
...Walters said he and his staff were planning to brainstorm through the night at Love's Middle Street facility to come up with ideas for the shipments. Neighbor Island goods are roughly one-third of what it produces daily. 'We will entertain anything to take care of our customers,' said Walters, who has been in the bakery business for 36 years. 'I've dealt with a lot of strike situations, I've been sent to 10 different states to help out with strikes, but nothing as catastrophic as this.'"
"Aloha scraps cargo division"
The Maui News and The Associated Press
POSTED: April 29, 2008
"KAHULUI — At Kahului Airport on Monday evening, Kula farmer Chauncey Monden picked up 70 cases of strawberries committed to a Times Supermarket sale on Oahu and wondered how he’d be able to get the fragile produce to the market...“They’re (berries) committed to Honolulu. I’m sure we can market them here, but if we’ve committed to deliver them to Honolulu, I have to see how to get them there.”
...Aloha’s cargo division transported a wide variety of items, including all mail to and from Maui and the Big Island, as well as produce and fresh flowers...
Maui County Mayor Charmaine Tavares...‘‘Many small businesses, such as farmers with perishable cargo, rely on transporting their goods via air carriers.’’
Maui Farm Bureau President Warren Watanabe agreed, saying a lot of Maui-grown produce and flowers are marketed on other islands, and farmers relied on Aloha’s overnight cargo flights to transport the perishable products. Watanabe grows specialty lettuce in association with Nalo Farms on Oahu, which promotes fresh local produce for top Hawaii restaurants, but his shipments are not as large or as frequent as those of other farmers.
Paradise Flower Farms is one of the bigger shippers, with co-owner Teena Rasmussen noting that the business had negotiated a special rate with Aloha because of its six-days-a-week volume. On Monday, she said a shipment to Oahu arrived, but a portion of the shipment destined for Kauai was stranded at the Honolulu Airport cargo section. “First thing in the morning, I’ve got to see what I can do, and hope Hawaiian can carry it,” she said. For Hawaii flower shippers, she said, Hawaiian Airlines may be the only realistic option because flowers need the refrigerated storage that only Aloha and Hawaiian have at interisland cargo terminals. “Hawaiian may be the only option. I hope they can step up and fulfill the need for all of the businesses. I hope they can gear up their cargo service quickly,” she said.
Monden said the Hawaii Superferry is not an immediate option because he would need to have a second truck and driver to make deliveries and spend the night on Oahu. As with other farmers, he also needs to make deliveries to other islands as well. The Superferry operates a round trip only between Oahu and Maui, and requires a driver to accompany any vehicles..."
"Superferry disclosed less than 6% of 2007 lobbying costs"
April 29th, 2008
"Hawaii Superferry, Inc. spent more than 17 times the amount previously disclosed while lobbying for special legislation during 2007, according to amended disclosure forms filed today with the State Ethics Commission.
The company now reports having spent a total of $379,431.52 during calendar year 2007. It had previously filed reports claiming total expenditures of just $21,791.56.
According to the new reports, signed by former CEO John L. Garibaldi, now vice chairman, the company spent $272,251.53 during the two month period beginning March 1, 2007 through April 30, 2007.
This sum included $166,851.97 preparing and distributing lobbying materials, $11,404.45 for media advertising, $23,028.96 for postage, and $63,917.39 in fees, apparently for public relations.
In its original report for this same two-month period, filed in May 2007, the company claimed that it spent a total of just $6,788.54.
The Superferry’s latest amended filings are available here, while its original disclosure reports are available on the State Ethics Commission web site.
The new reports were submitted after I wrote to the Ethics Commission several weeks ago complaining about the obvious failure of the company to report significant expenses, including mailings of more than 110,000 letters and petitions that were later submitted to the Legislature, and related fees paid to public relations firm McNeil Wilson Communications.
This massive under-reporting underscores the weakness of Hawaii’s lobbying law, which is supposed to provide the public a clear idea of what is being spent to influence public policies.
The state lobbyist law (Section 97-7 HRS) provides for administrative fines for any person who “Willfully files a statement or report containing false information or material omission of any fact.” However, it further provides that no fines can be assessed unless the Ethic Commission convenes a formal hearing and issues a final decision. Such formal hearings are rarely held, and the commission instead concentrates on obtaining voluntary compliance, even if after the fact..."
Anyway, I realized that the Aloha Air Cargo planes may not have actually been for sale by GMAC or Aloha. It may be that GMAC owns them and was only offering to lease them for those dollar figures that have been in the paper, in which case that may not be a "steal" for any company trying to take over that business. Maybe the papers can clarify this.
So, I thought of one other thing. We are talking about 85% of the interisland air cargo. This is almost a public necessity. It seems to me that if the State was even considering buying a frickin' resort on the North Shore, then instead the State might come forward with the money to maintain interisland air cargo, should no private sector company do it in an expedited manner. This makes a lot more sense than the State buying a resort.
Lastly, a reply that I got from the first of these posts:
Re: "Outcomes perverse and otherwise"
Sent: Tue 4/29/08 8:31 AM
"On the other hand I think this now opens the door for a new player to step in, with out the baggage (pardon the pun) of aloha/union/debt. Look for the new ‘mahalo’ air to be announced by United. TED is likely coming to HI. They need a jet feeder airline for their pax. Right now they are using aloha island air!"
Keep in mind, Aloha Air Cargo is profitable as opposed to some other new interisland businesses which are not. I think when the pilots union voted last week to approve a strike, if needed, to keep their seniority agreements in place, that that made the company bought directly from Aloha much less appealing. Under the new senerio all previous agreements with Aloha are washed away.
Aloha's cargo planes are still here. Before the company might have been worth something between $13 to $16 million. Now the planes are worth something slightly less than that, but now whoever buys them is free to use junior pilots that they can pay less.
I would look for a previous competitor to quickly buy these Aloha planes and hire the junior pilots who flew them and get the operations going again soon, but also work over time to make the sales pitch to shift some aspects of this time-sensitive interisland cargo to their slightly different existing operations. In order for that to work, they will have to change their commercial pricing, as the their price structure now is weighted too heavily toward large loads and makes smaller commercial load shipments too expensive.
At $13 million this is a steal compared to the money lost over the past year by at least one new interisland start-up company here. And, that buyer would gain quite a bit of coerced leverage with the state and prospective customers to force the growth of their existing unprofitable business. "...Outcomes perverse and otherwise," indeed.
Today in the Honolulu Advertiser:
Posted on: Tuesday, April 29, 2008
"Hawaii loses 85% of air cargo capability
'This is a critical link in the state economy,' local economist says"
"...Attorneys for the pilots union and Aloha's unsecured creditors said in bankruptcy court that Aloha will get less than $13 million by shutting down the cargo operations and selling its equipment.
"For GMAC to walk away from legitimate offers makes absolutely no sense at all," added pilot John Riddel. "It's a travesty. This should have never happened. Hundreds of dedicated employees are being victimized today."
Paul Brewbaker, chief economist at the Bank of Hawaii, said it may be some time before competing carriers and cargo operators fill the void left by Aloha.
"This is huge," said Brewbaker. "I don't doubt that somebody will come in and fill the void but in the short-term, anyone who wants to go to market is hung up..."
Monday, April 28, 2008
From the Honolulu Advertiser tonight:
Aloha Airlines shuts down cargo operations
Aloha Airlines said today it is shutting down its interisland cargo operations. Aloha, which carries 85 percent of all goods by air between the islands, said its lender was unwilling to provide further financing. (9:13 p.m.)
Aloha Cargo customers left scrambling (6:09 p.m.)
Superferry said it will do what it can to help interisland deliveries (6:57 p.m.)
Air Force has 8 cargo jets at Hickam (6:38 p.m.)
Breaking News: "Aloha Airlines to shut down cargo division"
POSTED: April 29, 2008
HONOLULU (AP) -- Aloha Airlines is shutting down its cargo division because its primary lender was unwilling to provide further financing. Aloha carries 85 percent of the state's interisland air cargo, including all mail to and from Maui and the Big Island. Airline attorneys say GMAC Commercial Finance's decision to stop financing Monday came after two companies interested in buying the cargo division pulled out...
Well, the following event looks even more interesting:
WEDNESDAY APRIL 30, 2008
UP IN THE AIR: THE FUTURE OF AIRLINE TRANSPORTATION, luncheon sponsored by the Hawaii Publishers Association, featuring Mark Dunkerley, CEO of Hawaiian Airlines, David Banmiller, CEO of Aloha Airgroup and Richard Hee, a vice president of Island Air; 11:30 a.m. registration, noon lunch, Hilton Hawaiian Village, South Pacific Ballroom II and III; $45 (cash or check) at the door. Information: 234-1288.
That was mighty fast,
Aloha to Aloha,
Beaufort Force 6, BOM 4, Likely seasickness among many passengers,
But if they go through the Kaiwi channel only (20 kn wind and 7-8 ft wind waves) the seastate will be:
Beaufort Force 5, BOM 3, Somewhat likely seasickness among passengers.
Will get an analysis of the financial requirements of MARAD up soon.
Sunday, April 27, 2008
"Superferry officials confident they can compete with airlines"
Pacific Business News (Honolulu) - by Howard Dicus Pacific Business News
"...Whether Hawaii Superferry will be profitable is something that concerns Alan Lerchbacker, the former CEO of Austal USA, which built the ferry.
"I just worry about getting enough business to cover costs because of the sheer size of it," said Lerchbacker, who came to Hawaii to sell the ferry but works in another industry now.
Lerchbacker said he suggested a 72-meter vessel only to see the company order the 100-meter model.
"For a smooth ride on the ocean, that ferry will have to go over 35 knots, and it costs a lot of money on fuel to go that fast," he said. "They may need 400 to 500 passengers to break even."
...Lerchbacker frets about this, and clearly thinks Hawaii Superferry should have gotten a smaller boat, but he doesn't want the venture to fail..."
Saturday, April 26, 2008
1.) From the LA Times yesterday, http://travel.latimes.com/daily-deal-blog/?p=1755, be sure to read down through the comments, they include one from "Tig Krekel Says: April 24th, 2008 at 12:21 pm Jeff is completely wrong on passenger count...over the next 4 days alone, we will have more than 1500 riders...Regards, Tig Krekel HSF Lead Director" Check out the other comments too. ;)
Was thinking some more about that “1500 over 4 days.” Actually, that is only an average of 188 people per one-way trip or 375 per round-trip and an estimated 63 vehicles per one-way trip or 125 per round-trip. That daily average would probably NOT cover just their fuel expenses. Those numbers are only slightly more than what we have been counting recently.
Considering that an extended (two week) Japanese visitors Golden Week is kicking in beginning today and that HSF’s best customer appears to be Roberts Hawaii, I might have expected more bookings of Japanese visitors on HSF during the next couple weeks, esp. since Japanese visitors were using Aloha Air quite a bit in the past. Roberts also appears to be monitoring the forecasted transit conditions as they have not been seen on “rough” days. Nevertheless, today, Sat., and Sun. will be calm days for them to do better.
2.) HSF might also get a cargo bump if Aloha Cargo pilots go on strike soon. See: http://the.honoluluadvertiser.com/article/2008/Apr/24/ln/hawaii804240371.html "Aloha pilots sanction walkout" By Rod Ohira, April 24, 2008. "Aloha Airlines pilots last night voted overwhelmingly to authorize a strike of the carrier's cargo operations. No strike date was set. 'It means should we need to strike, we will,' said John Riddle, a 23-year Aloha pilot and member of the union's master executive committee."
3.) THE radio interview was mentioned in a Honolulu Advertiser reporter's blog at: http://capitolnotebook.honadvblogs.com/2008/04/22/guerrila-radio/, check out the comments.
4.) Disappeared News has a good link to the audio of that KKCR radio interview of the two former Austal welders at: http://disappearednews.com/2008/04/second-program-on-alleged-superferry.html. The two welders are Carolyn Slay who worked on the Alakai and Wayne Jenkins who worked on the sister ship currently being built. Carolyn Slay has the additional recently filed federal lawsuit along with 21 other plaintiffs: Adams et al v. Austal, U.S.A., L.L.C. Case Number: 1:2008cv00155: http://dockets.justia.com/docket/court-alsdce/case_no-1:2008cv00155/case_id-42983/.
5.) Lastly for now, the New York Times had a good article today on a related story, "Lesson on How Not to Build a Navy Ship" by Philip Taubman, April 25, 2008: http://www.nytimes.com/2008/04/25/us/25ship.html?th&emc=th.
Amazing how some aspects of this story can be covered by a small radio station on an island, then the largest state newspaper...in a blog, then the largest west coast newspaper...in a blog, and finally the east coast newspaper of record all in a little more than a week, but the more shocking aspects of the story still not be reported to the public, except by little radio station in a Garden Isle paradise.
Monday, April 21, 2008
Vessel arrived in harbor at 10:00am today. Was offloading by 10:11am.
Offloading: counted 34 vehicles, 95 people. Included 1 Fed-Ex truck and 1 Expeditors truck. "Overnighter" company looked like it booked 30 to 40% of the people. [Made me think this vessel might also do well in Japan if not Puget Sound. Believe Fed-Ex is testing the logistics of this in case Aloha Cargo pilots go on strike next week.] Did not cover fuel costs today.
Onloading: counted 22 vehicles. Included 1 Fed-Ex truck and 1 Expeditors truck. [Estimate people not counted at 3 times vehicles.] Did not cover fuel costs today.
Spoke with three of the people on the shoreline who are there on a daily basis. All three seemed very knowledgeable about the issues involved on this. One of them, John, I will call him "Maka'ala" John, is a middle-age Hawaiian man. "Maka'ala" John says the number of cars and people who have been getting off and on has been about the same as today over the past week or more. Would not characterize it as "strong" or "ramping up."
"Maka'ala" John wanted to say he has noticed something that opponents on Maui have not mentioned in the media. John said that, "when the vessel is departing and backing up that its jet propulsion churns up the matter on the bottom of the harbor as the vessel turns and accelerates its engines to leave the harbor." John further stated he, "has been noticing what he thinks is the diminishing quality of the water in the harbor as a result." This is interesting because Jonathan Jay noticed and mentioned at the Belt Collins "EIS" Kauai hearing a similar thing at, "Nawiliwili Harbor from the two days there with the jets churning up the bottom and a septic smell came from the harbor afterward." Jonathan Jay asked that that be looked at in the "EIS".
Saturday, April 19, 2008
"Disembarfing" - The act of leaving the vessel after a ride during which many passengers "lose their cookies." - Ian
Regarding seasickness and adding more opportunities for that; we reference the following posts:
About the 'more opportunities,' we reference the following articles:
"Superferry announces second round trip;
Additional service between Oahu and Maui to begin May 9"
By EDWIN TANJI City Editor
POSTED: April 19, 2008
"Hawaii Superferry announced it will begin a second round trip four days a week between Oahu and Maui beginning May 9, drawing questions from its critics on Maui and a promise by Mayor Charmaine Tavares to monitor environmental reviews.
...Maui Tomorrow member Dick Mayer, a retired Maui Community College professor, noted that the Superferry immediately began taking reservations for the second Oahu-Maui runs although it has not yet received approval from the state Public Utilities Commission.
“It’s the same pattern as when they ordered their ships a year and a half before they had approvals to begin their service in Hawaii,” he said. “It’s unfortunate that they haven’t learned their lesson.”
In announcing the second trip, Garibaldi said “advance bookings have been very strong” since service resumed April 7." [Not the days I was out there counting.]
"Superferry poised for 2nd Maui run;
State approval needed for afternoon/evening trip beginning May 9"
By Gordon Y.K. Pang Advertiser Staff Writer
Posted: Saturday, April 19, 2008
"Hawaii Superferry is launching a second O'ahu-to-Maui roundtrip that will provide afternoon/evening sailings four days a week, the company announced yesterday.
...Pending approval from the Public Utilities Commission, the second trip will start May 9 and operate afternoons on Sundays, Mondays, Wednesdays and Fridays.
...Despite not yet securing PUC approval for its afternoon schedule, Hawaii Superferry yesterday said it is taking reservations for the second trips.
..."That is what we're projecting once we get ramped up," O'Halloran said. "We're not there yet but the bookings are strong and increasing daily." [Strong?]
The summer months also mean a calming of Hawaiian waters, he said, and a reduction in the number of rocky voyages that have left a number of Hawaii Superferry passengers seasick in the past. [Trade wind created wind waves in the channels will continue to be 6 ft.+ in the summer.]
...Kula resident and Superferry opponent Dick Mayer said he was unhappy that the company began taking reservations yesterday even before it received PUC approval for the additional trip. "That's typical. They keep putting pressure on the state government to 'give us approvals right away,' " Mayer said.
...Mayer said people who have been monitoring the number of passengers and vehicles count the vessel averaging about 20 percent full, and said he doubts the increased trips will help the fledgling business stay afloat." [Dick was being generous. More recently the numbers have been 15% of capacity with some days just above 10% of capacity...stronggg.]
And a strongly worded editorial in the Maui News today:
"Audit details malfeasance"
POSTED: April 19, 2008
"The state auditor has yet to write her final report, but it is clear from a preliminary release that the state Department of Transportation officials were guilty of malfeasance in deciding to put $40 million into harbor changes to accommodate the Hawaii Superferry without an environmental assessment.
The investigation of how and why the decision was made was ordered by the Legislature and was conducted by state Auditor Marion Higa. The audit will most likely confirm what nearly everyone knows — the DOT, which answers to Gov. Linda Lingle, was so intent on having an interisland ferry service, it gave the Hawaii Superferry whatever it wanted, when it wanted it.
It appears that Superferry officials approached the governor, who became an enthusiastic supporter of the enterprise, and on the strength of that support were able to negotiate the $300 million or so in financing needed to get the boat in the water. Part of that financing was a federal $140 million loan guarantee that expired Jan. 1, 2006.
Higa’s preliminary report says Superferry CEO John Garibaldi threatened to move the operation elsewhere if the state didn’t give him a go-ahead by June 30, 2005. Hawaii’s environmental law mandated an environmental assessment be done to determine if a time-eating environmental impact statement would be required.
It is apparent that state officials knew an assessment would trigger an EIS and that would put the Superferry on hold to well beyond Garibaldi’s deadline.
The DOT’s handling of the Superferry situation confirms that leaving agenda-driven decisions to bureaucrats and elected officials with a bureaucratic mind-set will result in laws being ignored and broken. Hawaii and its taxpayers deserve better."
Friday, April 18, 2008
"Thursday…How about a belch with that beer, change at the State Capitol, lobbyist disclosure questions, and a sunset view" April 17th, 2008
"...I submitted letters to the State Ethics Commission this week urging the commission to look at what appear to be unreported lobbying expenditures by Hawaii Superferry...The Superferry had a massive professionally organized grassroots lobbying effort involving direct mailings to more than 100,000 island voters soliciting their signatures on a petition urging lawmakers to back the ferry. None of that whole effort was ever disclosed by the company although reporting of advertising expenses and indirect lobbying efforts (soliciting someone else to lobby on your behalf) is clearly required."
Click on "Hawaii Superferry" above to read Ian's letter. Quite nice research.
Thursday, April 17, 2008
One example of such a report as mentioned above is the following:
http://www.khnl.com/global/story.asp?s=8191394; from that:
"...the June 30, 2005 deadline was issued by the Maritime Administration or MARAD....MARAD told the Superferry the company would not get the $140 million dollar loan guarantee it needed to build the ship if that June 30th deadline was not met. [This is a restatement by the reporter that is incorrect, Superferry did not need the 'loan guarantee' on a bond to have the ship built.] He says his department was aware of that deadline as well. 'We knew the deadline was in fact a deadline that the Superferry would not come to the State of Hawaii if they could not execute a ship building contract by that date,' said Mike Formby, the Harbors Director." [This is a carefully worded statement by Mike Formby that is correct, but he does not state that the 'loan guarantee' was needed, just that they would not come to Hawaii if they could not execute a ship building contract.]
Further comments below from Dick Mayer:
State Auditor Report on Superferry exemption decision
From: Dick Mayer
Sent: Thu 4/17/08 8:28 AM
"As you read this, keep in mind that the Hawaii Superferry Company
prematurely placed its order (Jan. 2004) for the construction of the 2
superferries about 14 months BEFORE they received any exemption
from the EIS law.
HSF consistently claimed that they had time deadlines, so they needed
quick approvals, first from the PUC (Dec. 31, 2004), then from the State's
EIS law (Feb. 2005), and finally from the State Legislature (Spring 2005)
for the $40 million barges.
Special Session Act 2 asked ONLY for an audit of the EIS exemption
decision, not all of the other decisions that were pressured (PUC +
Legislative $40 Million) to meet the needs resulting from the Hawaii
Superferry's own premature order of the 2 superferries."
First, from the AP article in the Maui News on this:
"Audit: Hawaii gave in to ferry" By MARK NIESSE, The Associated Press
POSTED: April 17, 2008
"HONOLULU — Hawaii’s government caved in to pressure from the Hawaii Superferry, allowing it to bypass an environmental review from the state, according to an audit to be released today.
The report finds that the Department of Transportation exempted the Superferry from an environmental study after the interisland ship threatened not to come to Hawaii unless it was given the go-ahead by June 30, 2005.
...Since then, the Superferry has been carrying small loads of passengers and cars from Honolulu to Maui when it hasn’t needed repairs, as it did from Feb. 13 to April 7. The ferry still hasn’t resumed voyages to Kauai.
...'There was pressure on them (the Department of Transportation) to make a decision, and they made the best decision they could make at that time under the circumstances,' Formby said. 'It would be inaccurate to say the date didn’t matter. It did matter. But at the same time, it would be inaccurate to say the harbors division didn’t do their homework, because I think they had.' [Besides the fact that the MARAD loan guarantee was not necessary for the state nor the transaction, DOT did not make adequate use of the US Army Corp of Engineers studies of Kahului Harbor with regard to Pier 2. Something that has continued with DOT's EIS and alternatives for the proposed Kahului Harbor improvements. That EIS has a lack of varied alternatives including the developing current economic considerations with regard to declining demand for passenger traffic in Kahului Harbor.]
...The state has said the exemption decision was made by Barry Fukunaga, who was then deputy director for harbors but was later promoted to DOT director and currently serves as Gov. Linda Lingle’s chief of staff.
The audit recommends that an entity should be given authority to enforce environmental laws, state agencies should document findings that lead them to make an exemption decision, and guidelines should be developed to ensure that all steps required to protect the environment have been followed.
The auditor continues to gather information about the Superferry for a second report to be released later."
Also, from the article by Derrick DePledge of the Honolulu Advertiser on this: http://www.honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20080417/NEWS01/804170348&referrer=FRONTPAGECAROUSEL
Posted on: Thursday, April 17, 2008
"Audit: Superferry drove state actions;
Lingle administration criticized for bypassing environmental review"
State path set in '04 Awana, ferry talks
Hawaii, ferry at odds in '04 over environment
By Derrick DePledge Advertiser Government Writer
"The state may have compromised its environmental policy because of pressure from Hawaii Superferry executives who were worried about financing for the interisland ferry project, the state auditor has concluded.
The auditor found that an internal June 2005 deadline imposed by Superferry executives "drove the process" and pushed the state Department of Transportation to bypass an environmental review. The deadline, according to the auditor, was tied to Superferry's agreement with Austal USA to secure financing to pay the Mobile, Ala.-based shipbuilder to construct two high-speed ferries.
...Most significantly, the auditor — like The Advertiser — emphasized a late December 2004 meeting at the governor's office that included the governor's then-chief of staff Bob Awana, department officials, and Superferry executives.
Staff in the department's harbors division had wanted to require a statewide environmental assessment of the project and to get Superferry to install a stern ramp on the vessel to give it more flexibility at Kahului Harbor on Maui. But Superferry executives, according an account by a department staffer, told the state that anything but an exemption was a deal-breaker and that they would not install any ramps.
"Decisions made: We need to pursue EXEMPTION; and HSF will not provide any ramps on vessel," one department staffer told colleagues afterward in an e-mail.
[JHS vessels usually have their own ramp/s on board.]
...The audit recommends that the Legislature empower a state agency to enforce environmental review laws and require agencies to update exemption lists every five years. The auditor found that the public has little involvement in the exemption process other than the right to file a lawsuit to challenge an exemption.
...Formby said, 'and basically, they look at the response you gave, and they go out and look for a way to rebut your response.'"
Tuesday, April 15, 2008
"In case you haven't heard last week's program yet, just click here. It should play without too much waiting."
I had the time yesterday to go check it out. Here is the report for 4/14/08:
Ship came into the harbor at 9:50am. Offloading by 10:04am.
Offloading: 35 cars, 77 people. No Roberts bus activity seen on this rough water day. One suspect car.
Onloading: 21 cars + 1 trailer. Could not count people. By company reported statistics, can multiply vehicles by 3 to get a high estimate of people in either direction.
Was going to try to go over today, 4/15/08, but did not get time to do so.
Couple of good things from the editorial page of the Maui News on 4/14/08:
Letter to the editor; good humor:
"Creative engineering could have saved Aloha Airlines"
POSTED: April 14, 2008
"What’s up with Aloha Airlines filing bankruptcy and then going out of business? The airline needed more resourceful board members or should have hired smarter lawyers. Why didn’t they consult Superferry CEO John Garibaldi, an ex-airline executive?
Did they all forget that last October the Legislature held a special session and passed a special law allowing special considerations for special large capacity ferry vessels, without naming the Specialferry?
Aloha guys blew it. All they had to do is bolt a couple of pontoons to the wings of their planes and presto change-o, instant large capacity ferry vessel. Just add water. Load them up, taxi out, take off and fly at a couple hundred feet, no bumping of whales and no puking in rough seas, land just shy of the harbors, taxi in and disembark.
No EIS needed, just ask Linda Lingle. I’m sure she would be happy to pitch in a few million for docking ramp alterations and then they’re good to go.
I even have a catchy name: Aloha FlyFerry."
And a very good editorial from the Maui News on 4/14/08:
"Airlines flying in very thin air"
POSTED: April 14, 2008
"It’s ironic that the most efficient major interisland airline, in terms of cost per seat flown, was the first of three to be grounded. Last week’s testimony in Washington, D.C., detailed the financial downfall of Aloha Airlines’ passenger service.
The airline worked its per-seat cost down to $50 per flight, compared with Hawaiian’s $55 and go!’s $67. Check those figures with the fares charged by go! — and largely matched by Aloha and Hawaiian — in the three-way battle for customers — from $9 to $39, with $1 flights briefly. There was a great deal of juggling prices depending on the time of the flights, advanced reservations, etc.
In the end, Aloha’s pockets were just not deep enough to last until an armistice was declared in the fare war.
Mesa Air Group, the parent of go!, may find its pockets are also not deep enough. When its stock fell to 81 cents a share last week, Mesa was valued at less than $22 million, about what it has spent trying to establish go! in the interisland market.
Competition for customers, who naturally won’t pay more than they have to for anything, wasn’t the only factor involved in Aloha’s shutdown of its passenger service. Aloha, and all the airlines, faced fuel costs that jumped something liked 75 percent across the country.
The Legislature had the opportunity in 2007 to cushion the fuel-cost blow to the interisland air lines but didn’t. The state could have exempted the interisland airlines from paying the state’s general excise tax on fuel on the valid grounds the airlines leave the state every time they fly between the islands.
In a free-market economy, there’s little that can be done to preserve any business, no matter how long established. Government has no business getting involved with private business by providing subsidies or unsecured loans, but it can take a long look at how regulations and tax policies are adding to consumer costs."
Saturday, April 12, 2008
The New York Times
Saturday, April 12, 2008
"Even the Whales Have Their Predators: Ships"
By SHAILA DEWAN
"OFF THE GEORGIA COAST — On a day so clear the ocean, from certain angles, is nothing but a field of glare, a team of spotters in a Twin Otter airplane flies a precise grid pattern, looking for North Atlantic right whales in the warm, shallow waters they use as their winter calving ground.
The goal is not scientific but protective: to keep ships from hitting the slow-moving, endangered whales as they creep along their coast-hugging migratory route, passing in view of the last remaining undeveloped barrier islands that flank the southern Georgia coast.
A beeper notifies the spotters that seven adult whales have just been sighted by another team in the waters off Charleston, S.C. The news is not particularly comforting to Patricia Naessig, the right whale aerial survey coordinator for the Wildlife Trust, which operates such flights here under public contract.
“They still have a bit of a gantlet to pass,” Ms. Naessig said over the headset she wore to communicate above the noise of the plane’s engines. “There’s a huge amount of shipping interests in Charleston Harbor.”
Ships are one of the two leading causes of unnatural death among right whales, and scientists have warned that the unnatural death of even one breeding female has the potential to tip the species toward extinction. From 2002 to 2006, there were 17 confirmed deaths by ship strike, at least six involving adult females.
In an effort to stop the fatalities, the National Marine Fisheries Service has tried to impose speed limits on ships within 30 miles of port. But the White House has delayed approval of the rule, which is opposed by some shipping companies.
The White House Office of Management and Budget is supposed to review federal agencies’ rule proposals within 90 days, with an optional 30-day extension. In the case of the right whale ship strike rule, it has been more than a year.
“Agencies are doing due diligence to develop a balanced rule that is effective in protecting endangered species,” said Jane K. Lee, a spokeswoman for the budget office. Ms. Lee declined to explain the rule review process or answer questions about the 90-day deadline.
The North Atlantic right whale, which grows to more than 60 feet and is black with distinctive white markings, is the state marine mammal of Georgia and could be called America’s own whale. The hunting of it in the 1800s bolstered the success of the country’s whaling industry, but depleted the stock so severely that hunting it was banned in 1935.
The remaining whales, now rare, travel the Atlantic coast from the Bay of Fundy to Cape Cod to Florida, a habit that has made them vulnerable to ship strikes and another lethal problem, entanglement in fishing gear.
Particularly at risk are the females that come south starting in early winter to give birth and nurse. The mothers do not feed while calving or producing the thousands of gallons of milk it takes to nourish their young, and that leaves them in a weakened state for their return journey, beginning in early spring.
It was only about 25 years ago, after dead calves began washing up on Southern beaches, that scientists learned that right whales used this area as a nursery, said Barb Zoodsma, right whale recovery program coordinator in the Southeast regional office of the fisheries service, an agency of the National Oceanic and Atmospheric Administration.
For nearly 20 years, the fisheries service has tried various methods of protecting the right whales, like recommending shipping-route changes and radioing ships to notify them of whale sightings. The aerial surveys off the Florida, Georgia and South Carolina coasts alone cost $1.5 million a year in taxpayer money.
But the effect of the measures, especially those where compliance is voluntary, has been limited. A 2005 study showed that 95 percent of ships notified of whale sightings failed to slow down or skirt the area.
After a three-year deliberative process that included the efforts of working groups, environmental and economic impact statements, and more than 5,000 public comments, the fisheries service proposed that during whale season, which varies by region, ships greater than 65 feet be limited to 10 knots as they near port.
Ship companies, port authorities, pilot associations, the Navy and even operators of whale watch tours have opposed the rule, saying that the permitted speed would be too low for safe steerage, that foreign vessels cannot be forced to follow American speed limits or that the restriction would cost too much.
The Georgia Ports Authority asked how the agency could “responsibly justify putting the entire economic burden for compliance with speed restrictions on 100 percent of the oceangoing commercial fleet when, at best, it may be responsible for less than 50 percent of the collisions?”
(The rule would exempt Navy and Coast Guard vessels, which are already supposed to take steps to protect the whales under the Endangered Species Act. Nor would it apply to smaller vessels, a source of growing concern among some experts. Whales have been fatally hit by recreational boats, and the experts fear that increasing development on the Georgia coast, including a proposal for an 800-boat marina that would be the state’s largest, will only make calving season more hazardous.)
The World Shipping Council, an organization of mostly foreign-owned ship operators, has protested that there is not enough proof that reducing speed also reduces collisions. The council offers its own models that show speeding up lowers the chances of a whale strike.
Environmentalists are skeptical.
'The argument they’re using is, well, the faster they go, the faster they’re in and out of the way,' said Vicki Cornish, vice president for marine wildlife conservation at the Ocean Conservancy, which supports the rule. 'So let’s put speeding cars in front of a school so they’re in and out of the way before they hit a child.'"
Friday, April 11, 2008
Structural Design of Hawaii Superferry
by Juan Wilson on 8 April 2008
A WOLF IN SHEEP’S CLOTHING
The Hawaiian Superferry Alakai was built for the HSF Corporation by Austal USA in Mobile Alabama. This is a subsidiary of the Australian ship builder. The company that designed and constructed it was the American division of Australian ship builder Austal USA. The Alakai was one of two sister ships in a contract costing approximately $180 million dollars.
When Austal was first consulted to design a civilian ferry operation in Hawaii, they recommended a smaller ship than today’s Alakai. This was due to the fuel efficiency needed to make its operation profitable. Austal was over-ruled. The Alakai is the largest all-aluminum hull built in the U.S. It has four ten-thousand horsepower diesel turbines to provide thrust. It is not unlike a high performance fighter jet in is configuration. It uses a similar structural premise:
Create a series of light metal frames and “skin” them with a thin metal sheets that produce a aerodynamic (or hydrodynamic) form. At the rear-end provide much turbine thrust as is possible, regardless of price, and train some pilots to keep these craft from crashing into things.
It is clear that the connection of this project to navel strategic planning negatively affected the ships implementation as a civilian ferry. But, the board of the Superferry corporation was stacked with Navy representatives, which includes its chairman, former Reagan Navy Secretary, John F Lehman. For the past three decades Lehman has pushed for a doubling the number of Navy vessels and creating a new kind of warship fleet in the process.
From the beginning the Hawaii Superferry’s core function has not been to be a profitable private ferryboat business. It is, in fact a working prototype of what Lehman has been dreaming about for a military Joint High Speed Vessel (JHSV). This explains why the partnership with the Army’s Stryker Brigade and Navy are an integral parts of the HSF planning. In the need to satisfy the Navy, Army and civilian specifications, the Superferry may have become badly compromised.
THE FLOATING BRICK
This has happened many times when a new weapons platform has had to fulfill too many promises. It certainly happened with the F-18 Fighter/Bomber which was laid at Lehman door. He knows something about getting something you don’t want shoved down your throat. In the fall 1982 Mary Ann McGivern wrote about the F-18 program in The St. Louis Economic Conversion Project (page 199 of (http://sdi.sagepub.com/cgi/pdf_extract/14/2/199):
“The plane was designed as a cheap compromise for the Navy and Marines each having their own air support (needs)... One gets the sense that the F-18 has been thrust upon the Navy... Secretary Lehman threatened to cancel the contract unless McDonnell-Douglas’ price went down instead of up... The Navy says the plane is not a good attack vehicle... it had too much roll, too much fuel consumption, too heavy, not enough cruise range, and troubles with the fuselage. McDonald-Douglas (The builder) says that a lot of the Navy's criticisms, including the current ones, are of factors that were never in the design specifications. Such a reasonable response will not make the Navy like the plane.”
The F-18 earned it enmity of the Navy and their complaints about it sounds a lot like a description of the Superferry JHSV. A “floating brick” instead a “flying brick”Lehman and his Navy cronies went ahead designing their JHSV anyway. Austal did what it was told. For example, with a few tricks (like providing no on-board vehicle ramps) they got around the necessity of a DOT triggered EIS requirement.
BLIND MEN FIND AN ELEPHANT
Austal used several individual computer software packages to engineer the form-factor, structure, performance and details of the vessel. [...] For more see: http://www.austal.com/go/design-and-technology/design-and-technology#structural
It is clear that, as with most modern engineering programs, many design components have to be handled with separate computer software packages. “Virtual” ships have to be built and tested as theoretical models for each package. Integration between software packages may, or may not exist. When a single company provides specialized integration between two of its products, things often work smoothly. That would be the case with MaxSurf and HydroMax that are both provided by Marine Survey and Design Company to work with each other ineractively. This may not be the case with results of integration between Shipflow and Hydromax.
It is not dissimilar situation to several blind men coming across an elephant and each “seeing” a different beast based on that part of the elephant his hands have touched. Not only will they see different animals, but the blind men may never reach all parts of the elephant. As a result they could be very surprised when confronted with unknown features.
Individual software programs can have the same failure of observation. This is likely in complicated projects with many parts that are pushed to the limits on tight schedules.
ROCKET PROPELLED EGGSHELL
It is my opinion that too much stuff is going on in the narrow confines of the stern of each catamaran hull. The transom of each is penetrated with two wide diameter water-jet thrusters that swivel to steer the ship. There are also penetrations for hydraulically operated Humphree devices (steering brakes) as well as a penetration of the hull between the water jets for a rudder shaft.
This complexity of systems for steering the Superferry are to keep the large hull from slewing and fishtailing as it tears through the ocean. It is likely that a smaller ship operating a lower speed would have been able to use a simpler set of controls. Each of these steering device’s “violates” the integrity of the hull and will cause hot spots of stress when the ship is twisted, bent and shocked by a succession of massive waves that are found throughout the Hawaiian Islands during much of the year. Metal fatigues, yields and fails under such repetitive conditions. Misfortunes that have been publicly reported include:
Misfortune #1: The first failure were at the seams around the rudder post penetrations. These rudders were not so much used for steering as for stability through the water. Stress on the posts created cracks that allowed some water to enter the ferry's hull. This was how they realized there was a problem - leaks. The ship would have to go to dry dock for repairs.
Misfortune #2: More bad things began to happen. In the process of getting the Superferry to the dry dock it was run aground. A push by a tug would be needed to free it. The tug operator gave the Superferry a shove and was surprised to have caved in a twenty foot section of the hull. Too delicate.
Misfortune #3: The trouble was not over. Once in the dry dock facility the Superferry keel was blocked in preparation to support itself out of the water. Some of the blocking was not precisely line on on framing points and when the Superferry was raised out of the water its keel failed to support the ship’s own weight and portions of the hull failed.
Overall, the results of the design program made for a Superferry that was too big and too fragile a vessel. It has too much speed and fuel consumption for the routes it would sail. The Superferry was guaranteed never be profitable as a civilian ferry. But worse, it would never be robust enough to handle the open Pacific swells it would find itself plying.
And, sadly for Mr. Lehman, this Superferry will not meet the rigors of military duty. It is designed like an eggshell with a rocket engine. I’m sure there are many changes that will be made if Austal get the next JHSV design contract. They sure will have the advantage of having been paid to build a full scale working model and testing it on some guinea pigs who live out in the middle of nowhere.
Very nice work by Juan,
Wednesday, April 9, 2008
Regarding HSF Routes
About the routes that HSF proposes, the one that hasn't been done yet is from Honolulu to the Big Island, Kawaihae. It is about 165 miles and at the ferry's speed would take at least 4 hrs and 20 minutes one-way to traverse. I gotta ask how realistic is that as an out and back route? That is more than twice the cost effective distance for this vessel with the same load of revenue generating passengers, cargo, etc. Anyway, there is more to this, but I have been told to keep it to myself for now.
Lehman Comparing Hawaii to the Canary Islands
"Lehman...his research showed that the Canary Islands, which are similar in size, population and distant location, have five [fast] ferries operating profitably."
I will also say that I checked the transit distances in the Canary Islands and the main route there is about 60 miles with other possible routes of 75 miles and a max of 90 miles. This is significant because with this type of vessel with its 4+ engines, fuel burned beyond two hours with the same revenue generating passengers and cargo becomes cost ineffective beyond 2 hours or about 70 to 75 miles. Here is a link describing the times involved of the ferry routes in the Canary Islands; the additional two longest routes there are 2 hours each.
I also checked Trinidad and Tobago and again the main route distance there is 40 miles with the longest route being 75 miles.
HSF and Cargo?
This was an interesting article. It may be true that the Superferry would be more useful as a cargo ship than as a heavily used passenger vessel in Hawaiian waters given the problem with wind, waves, and seasickness. But, I found two quotes very telling in the article.
First, "A 40-foot truck currently costs $866 full on the Superferry, in addition to a $39 passenger cost, while it costs $57.38, or $0.0383 per pound, for a local farmer to ship 1,500 pounds of cabbage on a pallet from Kahului to Honolulu via a refrigerated container on Young Brothers." There is no comparison here. At those rates the Superferry is way too expensive for most businesses regarding cargo.
Also, "David Amble, who last year completed an audit of the Washington state ferry system, said, 'People who are living on the islands in the Puget Sound, they like the convenience of the ferry but they like the convenience of pulling up the gate on the end of the day,' he said. 'If you live on an island you don't have to worry about everybody else coming into your world.'" Sounds like that could be applied to the Hawaiian islands too.
Alakai's Second Leg Each Day?
Also, based on a quote Garibaldi gave on Monday to the Honolulu Advertiser, "Garibaldi projected that consideration of a Kaua'i route wouldn't come until 'months' after Maui service resumed," [only months?] it can be determined what HSF will attempt to do with Alakai's second daily route/s throughout each week. We'll mention that later.
For now though, here was a good letter to the editor today in the Maui News. This is a good idea too: http://www.mauinews.com/page/content.detail/id/502369.html?nav=18
"Ferry would be better fit in Puget Sound"
POSTED: April 9, 2008
"I see in The Maui News that the infamous Superferry is making its bimonthly debut. Since most everyone in Hawaii is against it, why doesn’t the Superferry move to the Pacific Northwest where it would be greeted with open arms?
I can also say that the ferry system in the Seattle area is in dire need of an upgrade and what better than the Superferry. It would cut time in half with the commutes in the Puget Sound area.
I’m sure the great people in the Northwest would accept it with very little complaints, and look how much they would save on gas."
Tuesday, April 8, 2008
Instead, for now I see that there has been a lot of news today about "barfing." There were good Maui News and Honolulu Star Bulletin articles of which Larry Geller covered well:
So, I thought I would do a quick B-O-M extended forecast for any passenger vessels on these routes based on NOAA data:
KAIWI CHANNEL-342 PM HST THU NOAA AS OF APR 10 2008
FRIDAY:East winds 20 kt. Wind waves 7 ft. BOM Level 3 Somewhat Likely Seasickness
SATURDAY:Northeast winds 20 kt. Wind waves 8 ft. BOM Level 3 Somewhat Likely Ss.
SUNDAY:Northeast winds to 25 kt. Wind waves 9 ft. BOM Level 4 Likely Seasickness
MONDAY:East winds to 25 kt. Wind waves 9to11 ft. BOM Level 4 Likely Seasickness
TUESDAY:East winds 20 kt. Wind waves 7 ft. BOM Level 3 Somewhat Likely Seasickness
PAILOLO CHANNEL-342 PM HST THU NOAA AS OF APR 10 2008
FRIDAY:Northeast winds 20 kt. Wind waves 8 ft. BOM Level 3 Somewhat Likely Seasickness
SATURDAY:Northeast winds 20 kt. Wind waves 8 ft. BOM Level 3 Somewhat Likely Ss.
SUNDAY:Northeast winds to 25 kt. Wind waves 9 ft. BOM Level 4 Likely Seasickness
MONDAY:East winds to 25 kt. Wind waves 10to11 ft. BOM Level 4 Likely Seasickness
TUESDAY:East winds 20 kt. Wind waves 8 ft. BOM Level 3 Somewhat Likely Seasickness
Hope it helps,
Monday, April 7, 2008
Vessel came in 30 minutes early today, "sick and fast" a reporter onboard called it. First day back from a few weeks of drydock. CG helicopter came in first at a few hundred feet altitude and buzzed the harbor and some of Kahului with two circles and left. Missed the pic as I was still driving. CG patrol boat not based on Maui attended Alakai into the harbor.
Offloading from Oahu: Less than 15 cars (I counted 12 and an onboard reporter also mentioned 12 to a Maui Tomorrow rep). Offloading 40 people with at least 5 visible staying on the vessel for a total of about 45 people. Disembarking included 1 dog, 1 car packed to the gills, and at least 1 regular commercial customer.
Onloading from Maui: 15 cars, 1 motorcycle. Could not count people onloading, but company reporting has averaged 3 people per car in the past...for an estimate of 45 people onloading.
The company would have incurred at least $15,000 to $20,000 of fuel expenses uncovered by revenue on the round trip today.
KGMB9 and KHON were on the vessel filming. Should have reports from them on TV tonight.
KPOA and Maui TV News were filming onshore and should have reports from them online soon.
KHON reporter reported to have gotten seasick, and their cameraman did not feel good, but did not report getting seasick. KGMB9 evening news reported some passengers getting seasick in what were relatively calm seas, [B-O-M Level 3, Beaufort Force 5].
Sunday, April 6, 2008
Wow, this is interesting to see who on Maui and Kauai are advertising in it, and for the barge company and some involved banking interest ads. Also, quite impressive for it's glossy look. The articles trying to associate itself with Hawaiian history are interesting in their historical aggrandizement.
From: Dick Mayer
Subject: Hawaii Superferry's 52 page 'in-flight' magazine
Date: Sun, 6 Apr 2008
Since you will probably never take a trip on the Superferry,
here is the Hawaii Superferry's 52 page 'in-flight' magazine.
Part 1: http://hisuperferry.blogspot.com/2007/11/hi-superferry-break-even.html
Part 2: http://hisuperferry.blogspot.com/2007/11/hi-superferry-break-even-analysis.html
Part 3: http://hisuperferry.blogspot.com/2007/11/hi-superferry-break-even_21.html
Part 4: http://hisuperferry.blogspot.com/2007/11/hi-superferry-break-even_22.html
In that process, I came across the following thesis again. I actually mentioned it in my testimony on Act. 2 to the Belt Collins BA's, but I think it went "in one ear and out the other." This thesis is about selection of type of ferry vessel based upon things like route, conditions, speed, engine power, fuel consumption, etc. It is exactly what was not done appropriately here.
A very interesting MIT Masters Degree thesis on ferry selection. I cite it here:
"Assessing High Speed Waterborne (HSW) Services, Based on Synthetic Aspects of Route Characteristics, Transport Economy, and Vessel Performance"
LEONIDAS M. TH. KAMBANIS File Format: PDF/Adobe Acrobat...break even analysis...'Superferry II'......dspace.mit.edu/bitstream/1721.1/36092/1/41094021.pdf
Leonidas Kambanis did another thesis for a second Masters Degree at MIT that is also very interesting. It is "Analysis and Modeling of Power Transmitting Systems for Advanced Marine Vehicles" http://dspace.mit.edu/bitstream/1721.1/36067/1/33950380.pdf
And is about the selection of propulsion systems for advanced marine vehicles taking into consideration design, cost-benefit, and propulsion for the needed purpose.
It is my belief that a commercial ferry for Hawaii should have about half the engine power of the Alakai and burn about half its fuel from a cost-benefit standpoint, given the route distances involved here. And that the design sould be a trimaran along the lines of Incat designs rather than the catamaran design of the Alakai, esp. for JHSV purposes. More on this later.
Saturday, April 5, 2008
There have been at least a couple of interesting articles in the past few days that consulted intellectuals regarding HSF and Aloha Airlines. First, to the most recent one in the Star Bulletin, http://starbulletin.com/2008/04/05/business/story01.html, here were my comments:
"This whole article contains a number of unrealistic assumptions by people who should know better. This will become apparent if not by this summer, then by next fall, no later then when the next winters swells roll in.
Their "Break Even Point" to cover all costs is not "400 passengers," it is more like:
"BEP: 644 passengers at $39 per person and 218 vehicles at $65 per vehicle [this BE analysis was one in Nov. '07, the vehicle dollar figures work in favor of HSF in lowering the BEP threshhold, so I leave it intact, otherwise even higher BEP passenger and vehicle counts would be required to break even] assuming a $17 fuel surcharge on each vehicle =$82 per vehicle." See: http://hisuperferry.blogspot.com/2007/11/hi-superferry-break-even-analysis.html
The "400" number was originally "400 to 500" in Superferry statements in early 2007. The 2 to 3 times increase in cost of fuel since then has pushed that figure up above their "500."
I think the Aloha Airlines CEO had it right, their business model is broken too.
It's about the cost of fuel guys. HSF burns fuel per person even faster than Aloha did."
And then there was the following outstanding article and quotes, http://www.mauinews.com/page/content.detail/id/502127.html, by Harry Eager of the Maui News quoting Bank of Hawaii Chief Economist Paul Brewbaker extensively. This is some good stuff. A few key quotes from that:
"Aloha’s departure leaves interisland market muddled"
Higher fares, fewer flights among the possible outcomes
By HARRY EAGAR Staff Writer
POSTED: April 3, 2008
"The islands continued adjusting furiously Wednesday to the failure of Aloha Airlines....
For the longer term, Bank of Hawaii Chief Economist Paul Brewbaker said the new interisland air traffic regime could come to a new equilibrium at any one of several levels...
In comments Brewbaker sent to The Maui News, he said the departure of Aloha presents a different set of alternatives for economists to analyze than in earlier events when Mahalo or Discovery airlines failed...
But after Sept. 11, 2001, Sen. Dan Inouye arranged an antitrust exemption for Aloha and Hawaiian, and that allowed them to reach a new equilibrium, because it made it less likely that a new third, outside threat would arise. The new equilibrium settled at $90 a trip. Mesa Air Group’s Chairman Jonathan Ornstein decided he saw an opportunity...
Leroy Laney, professor of business and finance at Hawaii Pacific University, said Tuesday...The market is so small (and has been shrinking) that fixed overhead costs made it difficult for either of two airlines to get enough business to get into profitable territory...
Ornstein upset the apple cart, or what Brewbaker calls the Cournot-Nash equilibrium. The Cournot-Nash equilibrium is now dead, and the interisland airline business has become what economists call a Stackelberg game. Instead of two equally matched contenders warily circling each other, the remaining unevenly matched contenders will try to exploit their differences. In this Stackelberg game, Hawaiian enjoys some market power — it’s bigger and neither Go! nor Island Air can exactly duplicate the vanished service...
The exit of Aloha “removes the principal source of rivalry that disciplined Hawaiian by undermining the market power it otherwise has from product differentiation,” said Brewbaker. “The game is afoot, literally, and we should not be surprised by outcomes perverse and otherwise.” Economic theory allows for a number of balancing points, which include:
• Higher fares and fewer seats.
• Similar or somewhat higher fares, with the entry of a major carrier in the Hawaii interisland market...
Guarantees (loan or debt) might have been required, but the state Legislature finally accepted the idea of loan guarantees, although a day late and about $120 million short. Meanwhile, Hawaiian pulled a backup Boeing 767 into line to provide hundreds of seats on six daily Oahu-Maui trips, Island Air added flights between Maui and Hilo and go! nearly doubled its daily legs."
Since this article ATA has failed too, adding more to the change in equilibrium. I heard a figure that ATA alone accounts for 1 million visitors to/from Hawaii a year. As I recall Hawaii receives 7 to 8 million visitors a year. With ATA and Aloha combined that is at least 12 to 20% of the air capacity to and from Hawaii disrupted. That is shocking.
As an aside, a long-time close friend of mine is a former high level hotel manager for the Sheraton chain. He maintains contact with many of their hotel general managers. He was speaking last week with one of those general managers in Ka'anapali and that person mentioned that one of the hotels in Ka'anapali had over a 1000 cancellations after the Aloha failure alone. Think about that, that is just one example. HSF won't matter worth a squat in this big picture.
Thursday, April 3, 2008
His second post was followed up today by the local paper in Mobile, AL: http://www.al.com/business/mobileregister/index.ssf?/base/business/1207214112259670.xml&coll=3
At first I did not read those closely yesterday. A lady, we will call her 'Camera,' pointed out to me the following cite within the first of the above posts by Springboard. This story is about a week old in the Mobile, AL, area, but it's a doozy. As Katy on Kauai might say, this is no longer just a series of bad PR mistakes, this is institutional, and seems to be indicative of how the company operates. How could Katy have known when she was hanging that banner that she was standing upon something built on those values? Is this Pono? I wonder what the prospective 'local' ridership will think of this, if they find out?
"22 workers sue Austal for racial discrimination"
Wednesday, March 26, 2008
By JEFF AMY and KAIJA WILKINSON, Business Reporters
"A group of 22 current and former black employees have sued Austal USA, claiming that company managers participate in and condone widespread racial discrimination at its Mobile River shipyard.
"Defendant's racial discrimination is its standard operating procedure rather than a sporadic occurrence," the plaintiffs stated in a suit filed last week in federal court in Mobile."...See rest of article at http://www.al.com/news/press-register/index.ssf?/base/news/1206522920295650.xml&coll=3
Wednesday, April 2, 2008
First, I put in a call to Lt. Titchen and got back a return call from an NCO Officer Johnson. Here is the code cite he gave to me:
CHAPTER I--COAST GUARD, DEPARTMENT OF HOMELAND SECURITY
SUBCHAPTER W--LIFESAVING APPLIANCES AND ARRANGEMENTS
PART 199--LIFESAVING SYSTEMS FOR CERTAIN INSPECTED VESSELS
Subpart C--ADDITIONAL REQUIREMENTS FOR PASSENGER VESSELS
§199.201 Survival craft.
§199.202 Rescue boats.
§199.203 Marshalling of liferafts.
Subpart F--EXEMPTIONS AND ALTERNATIVES FOR VESSELS NOT SUBJECT TO SOLAS
§199.610 Exemptions for vessels in specified services.
§199.620 Alternatives for all vessels in a specified service.
§199.630 Alternatives for passenger vessels in a specified service.
§199.640 Alternatives for cargo vessels in a specified service.
Larry Geller inquired and got back this response also from the Coast Guard:
------- Forwarded message follows -------
The quick answer is yes, the vessel is in full compliance with U.S. laws. The vessel is required to meet the SOLAS 2000 High Speed Craft Code and 46 CFR sub-chapter W for primary life saving. According to the certificate of inspection (COI) for the HSC Alakai, the vessel has over 100% life raft capacities. If you have any more questions, or need any further info, please let me know. Have a great day.
Michael De Nyse, Commander,
14th Coast Guard District
------- End of forwarded message -------
Lastly, I got this reply from an expert on Maui:
Re: HSF Life rafts
"That is checked at the COI inspection annually. Believe me they are more than careful about this. USCG makes you pull out every life jacket, life ring, and life raft and inspects each and every one. Any wear or tear, they must be replaced or no sail."