An Insight into Alaska Airlines’ Mindset Going Forward with Virgin America Merger

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 A Guest Post by John @laptoptravel

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The Merger is Expected to Be Completed in 2018

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I am very excited, as so many are, and intrigued by the merger between Alaska Airlines and Virgin America. For myself, as an MVP 75K member, it opens up new opportunities, increased capacity and more choices (especially along the West Coast.)

First Class Alaska Airlines

First Class breakfast aboard Alaska’s B737-800 (enroute between SEA & LAX)

Alaska has a team dedicated to the transition and we are anxious to hear exactly how they plan to integrate Virgin’s fleet and operational uniqueness into the Alaska system. There is a lot of speculation of what Alaska will or won’t do when it comes to absorbing Virgin America’s ‘hip peculiarities’; Boeing versus Airbus, Hip versus Conservative, Routes, Interiors, Perks and an endless myriad of policies.  How will they do it?  What are they thinking?

Thankfully, this week, we got another peek into the mindset of Alaska regarding some of those issues. Here are some highlights from a recent presentation by Scott Habberstad, Director of Sales and Community Marketing for Alaska Airlines.

A recent report by KRBD, a Ketchikan, Alaska radio station and news organization, offers some insights into Alaska Airlines’ thinking going forward with the Virgin American merger. Habberstad stated that the airline sees no reason why the merger would not get approved by the government. He also addresses the culture of Virgin America and how that might translate, in some form, through to Alaska Airlines’ operations:

“Virgin is different. It’s an experience. You board listening to Beyoncé,” he said. “It’s got purple mood lighting in the airplanes. It’s a different experience, but it’s a good experience. It’s fresher, it’s new. While I don’t think you’ll board to Beyoncé on us in the future, there might be a little bit of an uptick: A little fresher brand coming from us.”

He also said that Alaska will ‘try out’ the Airbus aircraft which are currently mostly leased on Virgin’s fleet.

Habberstad also mentioned Alaska Airlines’ relationship with Delta. He said “Delta is a good partner and a good competitor.” He also remarked that in spite of the fierce competition with Delta in the Seattle market that the Virgin America merger will allow Alaska to strengthen that position.

 

Synergy RouteMap Alaska Airlines Virgin America Merger

Current Map of Both Airlines’ Routes

I take that statement (about Delta being a good partner) with a grain of salt.  Surely, with a written partnership agreement between the two airlines negative statements are going to come forth with minimal frequency.  The two airlines still work together and Alaska even offers bonus EQM’s for its Alaska frequent flyer program, MileagePlan for members who fly Delta’s premium fares and credit them back to their Alaska account.

Habberstad added that the company will be concentrating on expanding its international partnerships in the future as well.

This is an absolute necessity; since Alaska’s international reach is limited to Canada, Costa Rica and Mexico. As the SeaTac (Seattle/Tacoma) Airport continues with its new international terminal it’s in Alaska’s best interest to get some ancillary revenue through that with increased international flights and partnerships.  After all, Alaska is going to pay its share for that terminal, based on passenger traffic whether they like it or not; a fact that Delta will surely reap the benefits of as it ramps up its Seattle hub for future international destinations and increased routes.  Delta’s goal is to increase its flights five-fold over summer of 2014’s traffic.

Alaska has a lot on their plate, and as oil prices (and jet fuel costs) rise, the costs of the merger, paying for the new SeaTac international terminal and competition with Delta make its burden heavy-laden, so no missteps can be afforded.

What do you think of the Alaska/Virgin merger?  Do you think this will help Alaska in their battle with their ‘frenemy’ Delta Air Lines? Have Fun ‘Up there!’ – John @ laptoptravel