Alaska, Hawaiian Airlines CEOs discuss status of $1.9B merger

HONOLULU (HawaiiNewsNow) - Executives from Alaska Air and Hawaiian Airlines are sharing more details of their historic $1-point-9 billion merger deal at Chamber of Commerce events across the islands.

Fresh off talk story sessions in Hilo, Kona, and Kahului, the CEOs of Alaska and Hawaiian airlines addressed several questions from Oahu’s business community — many concerning how benefits and the workforce may change.

Alaska Airlines CEO Ben Minicucci and Hawaiian Airlines CEO Peter Ingram explained how the combined company will mean more routes, more lounges and more perks -- especially for loyal fliers.

“Now you can use those miles on a larger network. Now you’ve chosen what miles on OneWorld and really the strength of that combined loyalty program is going to be really really powerful for our guests from here in Hawaii,” Ingram said.

“All those cities that Alaska’s network, the vast, vast, vast majority of those we’ll be able go to now,” Ingram added. “All those big cities that we don’t fly to nonstop, those are going to be available with a combined network.”

“Your elite status gets recognized at that level at that highest tier level and you have access to not only Alaska lounges but all 700 OneWorld lounges around the world,” Minicucci said.

Alaska Airlines is part of the OneWorld Alliance of carriers, which includes Japan Airlines and American Airlines.

Alaska said the combined airline will be positioned as a premium carrier to better compete with American, Delta, United and Southwest.

When asked how they plan to merge different reservation systems, technology and staff, executives said they’re still figuring it out.

While union jobs are protected, Minicucci said they’re working on a process for how to handle non-union jobs.

“It’ll be a big, big operation in Honolulu, where we’ll need everything that’s required here today. Our idea just to be clear is to grow this pie, not to keep it the same,” Minicucci said. “And when you combine both networks, the synergies will allow, like Peter was saying, there will be more opportunity to do more things, so the pie is gonna grow. So we see a big presence here.”

“Now, what exactly does the org structure look like? Most of the operations personnel of course we’ll need. The question is what the back office support will be. Obviously there’s a duplication in both companies. We’re gonna work through that whole process. We’re going to be extremely communicative in terms of what our progress is.”

Minicucci said the Alaska Airlines door plug blowout and recent grounding of Boeing 737 MAX 9 planes will not impact the merger, adding that inspections are being completed and all planes should return to service this week.

The deal is subject to federal approval.

“The federal authorities have to go through a review process, and that’ll happen over the next six months give or take,” Ingram said. “They’re very focused on the integration planning, what we can’t do is actually integrate, we can’t be combining anything yet.”

Last month, a federal judge blocked JetBlue Airways’ proposed $3.8 billion purchase of budget rival Spirit Airlines after the Justice Department sued to stop the merger.

When asked if that ruling will affect their deal, Alaska and Hawaiian say their situation is different.

Executives said it’s too soon to discuss new routes -- like the Philippines or healthcare flights to and from Lanai and Molokai.

For now, they said they’re listening and learning and getting guidance from a new 16-member Advisory Board.

Some things won’t change, like serving POG juice on Hawaiian flights.

Minicucci said he doesn’t plan to get rid of it, saying “I love POG juice.”

Minicucci and Ingram travel to Kauai next to wrap up their 5-stop listening tour.

Following the Chamber event, the Alaska team met with Hawaiian Airlines employees as part of what Minicucci says are efforts to listen to communities in Hawaii.

He said Alaska will modify its business model to accommodate the needs of the Hawaii market.

Hawaiian Airlines shareholders are scheduled to vote on the Alaska Airlines acquisition on Feb. 16.

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