Saturday, May 30, 2009

Hawaii Superferry files Bankruptcy

Today the Hawaii Superferry, Inc., the high-speed ferry between Oahu and Maui, and eventually Oahu and Hawaii and Kauai, filed for bankruptcy protection today. They cited a Hawaii Supreme Court ruling in March that struck down a state law permitting the company to operate before completing an environmental impact statement.

At the time of the decision, Tom Fargo, the Superferry President and CEO, said completing the EIS could take a year, and the company would dock the two ferries in Mobile, AL.

The company, which reported more than $100 million in assets and debts in its bankruptcy petition, said it will use the bankruptcy to close its business completely and liquidate the operation.

Formed in 2002 to provide ferry service between the 4 major islands, the company began carrying passengers in August, 2007 on the Alakai, an aluminum-hulled catamaran with a capacity of 866 people and 282 cars. The service was well received by most islanders who rode the ferry, and many welcomed an alternative to high inter-island air ticket prices.

In November, 2007, the legislature passed a law to permit continued ferry service despite a series of successful state court legal challenges. The March ruling stated that the law was intended specifically to benefit the company, in violation of the state constitution.

In its filing, the company also stated business was hurt by the decline in tourism, a 2008 increase in fuel prices, and the price war between the airlines GO and Hawaiian for interisland travel.

I was fortunate to take the ferry to Maui last winter and see the humpback whales (photo above), in what was a truly enjoyable experience. I am saddened the company found no way to re-enter the market in the future, and provide an additional choice for island travelers.

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