Mokulele considers seating modifications on its E-170s

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Hawaiian carrier Mokulele Airlines may modify the layout of the three Embraer E-170s used in its inter-island operations.

Dual-class, 70-seat E-170s were placed into Mokulele's schedule starting in November 2008 roughly a month after Mokulele inked a 10-year capacity purchase agreement with Republic Airways Holdings for its Shuttle America subsidiary to operate the jets in Hawaii.

The aircraft were sourced from a 2007 deal between Republic and Shuttle partner Delta Air Lines. Delta swapped 16 E-170s flown by Shuttle for 76-seat E-175s. Ten E-170s were designated for United Airlines and two were to remain with Delta until this August, leaving four aircraft for the Mokulele venture.

Mokulele CEO Scott Durgin tells ATI a decision about seating will be made during the next six to nine months.

The Republic pact covers four aircraft, of which three presently link Honolulu with Kona, Lihue and Maui.

Mokulele was to take delivery of the fourth E-170 earlier this year but that has been postponed until at least next summer due to the economic downturn and poor tourism figures, Durgin says.

Republic's aircraft agreement with Mokulele was in conjunction with an initial $8 million loan to the Hawaiian carrier. In March of this year Republic converted $3 million of that loan to equity for a 50% stake in Mokulule and infused another $3 million into the airline. In the second quarter Republic invested an additional $7.5 million in Mokulele, enlarging its stake to 89%.

Republic's total investment in Mokulele is now under $20 million.

In addition to E-170s, Mokulele has Cessna Grand Caravan 208Bs.