Hawaii for a buck? Mesa Air Group's (NASDAQ: MESA) go! Airlines has nine-upped Skybus's $10 tickets by offering 2,000 $1 flights to Hawaii. The tickets, which went on sale Monday, were quickly snatched up.
The move is bound to ruffle the feathers of competitors Aloha and Hawaiian (AMEX: HA), who filed a lawsuit late last year claiming Mesa had used confidential information the two had shared with Mesa as a potential investor to launch go!'s Hawaii service. The $1 promotion can only make the fare fight fiercer, good news for vacationers to the sunny islands.
Skybus, the newest RyanAir-model entry into the industry, has gained a great deal of attention for its practice of selling ten $10 seats on each flight. The remaining seats are sold, exclusively via its web site, on a sliding scale, growing more expensive as the plane approaches capacity.
Skybus's severely no-frills approach has put price pressure on budget competitors including Southwest (NYSE: LUV), Airtran (NYSE:AAI) and JetBlue (NASDAQ:JBLU). At a time when passenger traffic is softening and fuel prices skyrocketing, the prospect of a mini price-war among the bottom feeders doesn't seem strong. I can still hope, though -- I really would like to visit Hawaii.
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