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Anyone looking for insight into just how much COVID-19 has hurt Hawaii’s economy can turn to a new report from Hawaiian Holdings, the parent of Hawaiian Airlines, which on Wednesday released its earnings for the quarter ended Sept. 30.

Hawaiian is a bellwether of Hawaii’s tourism industry and economy in general. The airline isn’t just Hawaii’s dominant air carrier, it’s also one of the state’s largest private employers – the largest before COVID-19 – with thousands of union workers.

And its steep financial decline over the past six months or so is stunning.

One example: passenger revenue for the three months ended September 30 was down 95% from the year before, at $40 million compared with $694 million for the same period in 2019.

How did all this happen to Hawaiian so quickly? It started in late February when Hawaiian suspended service to South Korea and Japan as the virus spread in Asia. The declines in demand for travel to key markets sped up in March when governments started making arriving passengers self-isolate or quarantine. Also in March, Hawaii jumped in with its 14-day mandatory quarantine for all travelers coming to the state, including returning residents and interisland passengers.

The quarantine all but killed demand for flights to Hawaii. Daily arrivals dropped from 30,000 to just a few hundred. It wasn’t until Oct. 15 that Gov. David Ige modified the quarantine rule to let out-of-state arrivals skip the 14-day isolation if they test negative for the virus a few days before departing for Hawaii.

Hawaiian says it’s seen increased bookings since the new policy went into effect, but Wednesday’s earnings report covers perhaps the darkest days, when Hawaii tourism was all but shut down.

So how bad did things things look for Hawaiian in the third quarter of 2020? Hawaiian reduced capacity by 86.5%, parked 29% of its fleet, and shed 32% of its workforce through separation and temporary leave. Wages and benefits paid during the quarter were $19.5 million, an 89% decline from the $182.9 million paid out during the same period a year before.

And Hawaiian doesn’t expect to rebound fully any time soon. According to a planning scenario for the summer of 2021, the airline “assumes a 15-25% reduction in our anticipated flight schedule … and related reductions in headcount.”

The good news is Hawaiian has significant assets and sources of liquidity to make it through the hard times. During the third quarter, the company entered a CARES Act loan agreement with the U.S. Treasury that allows Hawaiian to borrow up to $420 million. As of Sept. 30, Hawaiian had borrowed $45 million under the program.

Hawaiian also completed $376 million in other financings secured by aircraft. The fact that Hawaiian owns much of its fleet unencumbered is a huge plus. The reported value of Hawaiian’s “long-lived assets,” principally of aircraft and other non-aircraft equipment, was $2.1 billion at Sept. 30.

The bad news: there’s still a great deal of uncertainty about the virus. And for a business that involves transporting hordes of people across the Pacific Ocean in closed spaces, that poses risks. Despite protocols to mitigate threats, Hawaiian acknowledged things can happen.

“There can be no assurance that guests will not be exposed to COVID-19 while traveling, or that our employees will not be exposed to COVID-19 while working,” Hawaiian reported. “Should such exposure be determined to have been caused while traveling or working, notwithstanding the steps we take to protect our guests and employees, we may be subject to civil lawsuits or employee grievances that give rise to legal liability.”

“Hawaii’s Changing Economy”  series is supported by a grant from the as part of its CHANGE Framework project.