Alaska Airlines’ acquisition of Hawaiian Airlines is progressing, albeit slowly. We were just advised that it is largely on schedule, which could mean it is still up to a year or more away. Meanwhile, others in high positions have mentioned it could conclude much sooner than that.
Most recently, the shareholders of Hawaii Airlines gave their approval. This is despite an ongoing shareholder lawsuit we were told would likely have no impact. In addition, earlier this month, the U.S. Justice Department’s Antitrust Division requested additional information and documentary material as part of its review process.
Hawaii’s four county mayors recently spoke out about the merger.
The mayors have concluded that the merger would enhance airline service for Hawaii’s communities, improve connectivity, and offer more options for residents. We’ll add that it will provide many of the same benefits for Hawaii visitors.
The mayors confirmed what we already know: for neighbor island residents, like BOH editors here on Kauai, air travel is much like a bus service. It is vital for accessing essential services like business meetings, medical appointments, seeing family and friends, and even dining out.
Not only that, but these airlines, on a daily basis, move workers between islands and small towns, including those in construction, medicine, and other fields. That is essential to keeping all business moving forward in Hawaii and in Alaska, including the travel business.
Both Alaska and Hawaii residents share significant similarities. Alaska has provided local and reliable service in that state for close to 100 years, and Hawaiian has done the same here in Hawaii.
What Hawaii’s mayors didn’t say seems clear.
They believe that allowing Hawaiian Airlines to merge with Alaska Airlines is the best path to ensure the continued health and longevity of our state’s largest airline, enabling it to serve local residents for generations to come.
The implication is there is no assurance that Hawaiian Airlines can continue in business without the pending merger. You’ll recall that Hawaiian Airlines has amassed about $1 billion in debt, which at last count, is increasing to the tune of $1 million per day.
Benefits for Alaska Airlines.
Alaska Airlines is #5 on the list of largest airlines in the US. That position isn’t expected to change. Hawaiian’s long-haul aircraft, flights, and experience, including widebody aircraft of two types (A330 and B787), should provide Alaska with a new means for long-distance expansion. That could provide more competition on routes across the Pacific and even help reduce costs.
Benefits for Hawaiian Airlines.
The merger reveals improved operational efficiency and expansion opportunities at the Hawaii bellwether. With a much larger fleet, new technologies, and other resources across the board, Hawaiian will have needed economies of scale that should improve performance while driving down operating costs. It offers them the potential for many new routes.
In addition, Hawaiian has nearly 7,000 employees, most of which are based in Hawaii. The merger would result in most people, especially union ones, retaining their jobs.
But flight attendants aren’t so sure yet.
Alaska and Hawaiian Airlines flight attendants are saying that they aren’t ready to give their blessing to the planned merger of the two airlines.
The flight attendants’ unions representing Alaska Airlines and Hawaiian Airlines have now halted that merger approval. Their unions want the commitment of both airlines to handle merger concerns to their liking and preserve what they deem essential elements of their respective contracts.
Public opinion on the proposed Hawaiian/Alaska merger.
We’ve already had a range of comments on this topic. Just today, Chris said, “Listen… Alaska wants to eliminate Hawaiian. As in the past they may tacitly promise things then when they can, dump all those promises. Alaska wants Hawaiian to cease to exist along with contracts, aircraft leases, employee bases, international routes, everything. It’s all going to end.
Yet, another comment responded, saying: “The Association of Flight Attendants, the union that represents both Alaska and Hawaiian flight attendants, is powerless to stop this merger. Hawaiian shareholders voted 98% in favor of the merger last week. DOJ Anti-Trust Division is not going to have cause to stop this from happening as it did with the failed Jet Blue and Spirit. Hawaiian is in a terrible financial situation and the future looks even more bleak without this acquisition. Sorry…it’s the hard truth. Get on board with Alaska or go the way of Aloha Airlines.”
Please share your thoughts!
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I think the merger will be great for state of Hawaii. After the Maui fires, tourism is looking to get back on its feet again. With all that being said, bottom line also is has long as the rank and file are not hurt. Pilots, airline attendants, mechanics etc.
It’s an Acquisition not a merger! Get it straight! Hawaiian will definitely be the loser in this Acquisition! Alaska will Not let Hawaiian continue as busines as usual, losing over $1M a day unless Alaska’s president is looking for another job because the Alaska shareholders won’t stand for their share taking losing value because of this unwise acquistion. Alaska has plans for Themselves! They’re acquiring Hawaiian to benefit Alaska not being compassion for Hawaiian’s incompetence.
As a frequent Alaska Airlines mileage to the west coast and recent Hawaiian Airlines mileage newbie I’m excited for both. Alaska should keep Hawaiian as the flagship airline for island otherwise locals will be pissed. I was upset about how Alaska ended Virgin America. Hopefully, Hawaiian will keep its partnership with other current airlines as a Korean Air frequent flyer from Dulles.
I am a frequent flyer with Alaska Airlines. I look forward to the merger because I believe that it will be a great merger for both airlines and passengers.
I feel everyone should have a say in this merger even the public too.all jobs at hawaiian should be kept even non union with every employer looking for employees. The public Flys these airlines we should have a say.alaska airlines should rethink what they are doing they not worried about hawaiian non union employees they don’t care that is totally not right in NY book
Retired flight attendant here. Having gone thru an acquisition before my retirement,I feel for the crew members. Someone is going to lose! It will become a drawn out situation that will take years to solve. The best Company doesn’t always win. My group lost retirement benefits and seniority!! All I can say is be very careful when you talk about mergers..
Well you’re to be excused for your perspective Chris as so many airline mergers turn into a real dogs dinner. They can be real messy. It appears this one could make minor aviation history If Alaska follows through with what they are saying…and why wouldn’t they?…..cherry picking the assets of HA while wasting HA’s biggest asset, it’s brand, intrinsically tied to it’s employees would be a huge waste. Kind of like buying a Ferrari and chopping up the bodywork and replacing the interior. There is no justification for going after the employees of either airline to make this deal work. Time will tell, but all indications are this could be a win win deal for both airlines.
Well folks! The bottom line is Money! Any way you cut it, Hawaiian is losing a lot of money (over a million dollars a day). What company can sustain that kind of losses? None! Alaska is not acquiring Hawaiian so Hawaiian and continue business as usual and keep losing millions. That is going to Stop! Alaska will be doing a lot of Hawaiian cost cutting. Too bad so sad! And, that’s the Facts folks! It’s all about Alaska’s Bottom Line and their shareholders! It won’t matter what our politicians hope will happen.
The comment that you reposted from Chris is way beyond funny so I would have to ask him what his airline business background is to make such a ridiculous statement.
True Don, It certainly isn’t realistic….pure negative fear mongering…disregards the fact that the 900 mil debt was run up by incidents that are mostly behind HA now. Covid, 8L, Maui fire, SWA temporary 39 fares etc….left them with a debt that the interest alone makes it difficult for HA to proceed without a Chapter 11 reorganization…. the Alaska deal is way better for the shareholders and the employees and of course bankruptcy is always a gamble. The }new” Hawaiian stands to be it’s best years yet, pretty amazing after 95 years serving Hawaii.
As a frequent Hawaiian flyer, Pualani Gold, I believe the merger will be a good thing. Though it is not common in the USA, in Europe there are several situations where one corporation owns two airlines that operate mostly as independent carriers. My guess is that it may happen in Asia too.
In the airline working world I know that seniority is everything. In my mind it is vital that flight crews and flight attendants, many of whom have relocated, not lose their domicile and seniority for a significant amount of time.
I feel that the Hawaiian brand needs to remain. There is a reason why my wife and I “standardized” on Hawaiian Airlines a few years back. While the aloha is not what it once was, it is still there.
Alaska Airlines will benefit the most. I work for a large global company that purchases companies to add to our portfolio or to keep competition from accessing the same technology. Often, we keep the acquired company name and most of the systems in place for a couple of years as required by the contract. After that, it is absorbed into the business model of maximizing profits over people, and the acquired company’s culture is lost. It is a loss for Hawaii! A better solution would be an influx of investors to help Hawaiian become profitable, acquire a younger fleet, and make deals with other airlines to work together. Hawaii politicians are not known for their great policies or strategic thinking.
This makes me so sad. The huge expansion of the airport and the purchase of all those brand new airplanes made me nervous. Now I know my nervousness was correct. Hawaiian Airlines was always so much better than they are today. So sorry
The Japan market was HA’s strongest money maker pre Covid and a big reason for their most profitable years when the stock price hit $60. Its slow return has been a big hit to HA’s finances. The prediction is now that it will be back to pre Covid strength in 2025….. Alaska is obviously well aware of that fact. Hawaiian Air/Alaska has even greater potential in that market. Japan loves the Hawaiian Air brand and it has a strong foothold there.
Clearly the deal is structured to maximize the advantages of the Hawaiian Air brand. Zero indication that Alaska has any intention of doing otherwise. Not to mention it would have been silly to spend that much money for HA and then not utilize the marketing advantage that the Hawaiian Air name provides…..the synergies the two airlines create will be substantial and very good for Hawaii and air travel there.