Aloha Airlines Back in Bankruptcy

Hawaii's Aloha Airlines became the first U.S. carrier to seek bankruptcy protection because of the current surge in fuel prices, but so far its filing appears to reflect local conditions rather than suggest another cycle of insolvencies is coming.

The 61-year-old airline, which filed last week in Honolulu and won court approval to continue operating while it seeks additional investments, got caught in a squeeze from which it could not escape, with fuel costs rising while intense competition is keeping inter-island fares low.

Aloha CEO David Banmiller blamed Mesa (MESA Quote), which chopped fares on inter-island routes when its subsidiary Go! began flying them with 50-seat aircraft in 2006. ...