Alaska and Frontier getting married?

[OOramperpilot]

Okay, heard a rumour from a Horizon friend of mine that Alaska and Frontier are working on some sort of deal. Not clear if it was a merger or a code share on steriods but it sounded pretty big. Anybody else heard anything similar?

 

[Kool]

AK737FO, Mach None, or Crashpad....

Anything heard brewing from your ranks? I don't even want to think how this cold affect possible interviews...yikes!

 

[F9 Driver]

I just read about this latest rumor on the yahoo FRNT board.

They suggest that this is Horizon using CJ7's as Frontier Jet Express.

I haven't gotten any info from the company on any of this, but we are generally the last to know.

PS here is another rumor thread

http://www.airliners.net/discussions/general_aviation/read.main/1181253/

 

[crashpad]

Don't know anything about Alaska either.... However, if Horizon serves F9 in the mountains they will blow the competition away.
An article in the news was stating how much these areas need more service/competition. Having JS on Horizon often, their service level is far superior to those flying for UAL at DIA.

 

[AK737FO]

Rumor control

There has always been an unlimited supply of rumors about Alaska being bought by someone, or Alaska buying someone.

In the last year I have heard that we were going to buy America West. The next rumor was that we were going to buy Frontier. The latest rumor is that we are going to buy JetBlue.

Remember, we are pretty small. We have about 1550 pilots on the line. We fill a nitch in the state of Alaska that can not / would not be done by anybody else. Will a big fish swallow us up someday despite our unusual route structure? I hope not... but who knows. Will Alaska buy out a smaller airline to grow with? Who knows. Possible I suppose, but not likely.

Right now our Management is trying to get huge concessions from all employee groups (with ALPA bearing 63% of the total burden). Management does not have a solid plan. They want the CASM down and they want us to fund it. Their "game plan" is missing the "4th quarter" though. Even if the employees gave them everything they are asking for, they would still be 75 million short of their goal. Due to managements inablility to come up with a complete game plan, I see this as nothing other than a money grab. They want to knock our wages and work rules down to the bankrupt airline level, then reap the record profits.

If the above were to happen, they would have lots of money available to play with... buy a small airline with, fund growth with, who knows.

Rumors are never ending and entertaining. I just know that tonight as I'm flying through Southeast Alaska, I will enjoy my job and be thankful for it. What the future holds? Who knows.

 

[Blue Dude]

Re: Rumor control

There has always been an unlimited supply of rumors about Alaska being bought by someone, or Alaska buying someone.

In the last year I have heard that we were going to buy America West.

Possible. Awful MD-80's, B-737's, A-320's and B-757's fleet mix. Mucho debt to buy. Hubs have OK coverage with SEA, LAS, and PHX. At least you're both ALPA.

The next rumor was that we were going to buy Frontier.

Possible. Not as many problems with fleet, but not a slam dunk either. FRNT still has B-737's but they're on the way out. OK hubs with SEA and DEN. Ugly integration issues.

The latest rumor is that we are going to buy JetBlue.

Not remotely possible; you couldn't afford it. JBLU's market cap alone is $3.5 billion, and the BOD would want a large premium over that. Utterly imcompatible fleet mix and culture, with hubs in SEA, JFK and a tapped out small focus city at LGB. You'd pay billions for a 50 plane operation? Nope.

Nice rumors though.

 

[crashpad]

quote;

"Possible. Awful MD-80's, B-737's, A-320's and B-757's fleet mix. Mucho debt to buy. Hubs have OK coverage with SEA, LAS, and PHX. At least you're both ALPA."

The Frontier union is in-house, for the record.

 

[F9 Driver]

In today's Plane Business Banter...

"Rumor has it that Horizon Airlines, the regional feeder for Alaska Airlines, is going to pick up where Mesa Airlines left off. In other words, look for news of an agreement between Frontier and Horizon in the not-too-distant future regarding new regional service."

For what its worth

 

[mach none]

Just read this:


The substance under the rumors:
Horizon's strategies lead to press speculation
Sept. 3, 2003

By Pat Zachwieja, Vice President of Marketing and Planning

There's an old saying in public relations that any media coverage is good media coverage. That was the case of a recent story out of Denver, which speculated about Horizon's future in that market but served to highlight our strategy to diversify our revenue streams. But before dealing with that story, some background information is in order.

It's no secret that for several years now, Horizon Air has been dealing with the multiple challenges of higher operating costs, the spread of low-cost competition and the shrinkage of the traditionally higher-yield business travel segment that we've historically relied on. These shifts have led to the restructure of many of our strategies--in response to them, we've actively sought ways to employ our resources more productively while also exploring new flying opportunities that would serve to diversify our revenue streams.

We've also been "harmonizing" our fleet deployments with Alaska Airlines in ventures that ensure the right-size aircraft flying at the right frequency levels are on every route in our combined network. To date, these efforts have proven a successful start toward the goal of achieving sufficient and sustained profitability.

Articulating this strategy in the May 3 edition of Leading Edge, President and CEO Jeff Pinneo said, "We must not ease up on our efforts to further reduce our unit costs, through bright thinking and improved efficiencies in every area of our operation. We must explore new avenues for improving the quality and diversity of our revenue streams -- to minimize over-exposure to any one segment and to ensure a proper balance for weathering the ups and downs of business cycles."

One of the strategies for diversifying Horizon's revenue streams has been to study the opportunities for providing contract flying services to other carriers, similar to the flying done by Skywest for United and Delta, and by Mesa Air Group for a number of airlines. Sometimes referred to as "fixed-fee flying," these contracts generally involve being paid a fee -- which covers all costs plus a specified profit margin -- to fly routes, while the carrier who's receiving the service retains ticket revenues from the flight. This revenue model is quite different from the one we currently employ.

Over the last year, Horizon has held exploratory discussions with a number of carriers, but to date nothing has come of these talks. As is normally the case, both parties in such negotiations require confidentiality until a signed agreement is reached, refrain from comment on such talks, and neither confirm or deny negotiations with any specific party.

Nevertheless, sometimes the media try to speculate, and today an article to this effect was published in Denver, Frontier Airlines' home city. Citing unnamed sources, The Rocky Mountain News reported that Horizon is in talks with Frontier to provide fixed-fee flying. The report was not confirmed by Frontier nor Horizon. The story did quote an economic analyst who said such a deal "makes strategic sense."

While it is gratifying to read in print that others consider Horizon's diversification strategy wise, Horizon's position to withhold comment and neither confirm or deny any negotiations until the appropriate time remains in effect.

However, should Horizon be successful in reaching any kind of agreement with another carrier, every effort will be made to communicate with employees first -- and certainly before the media.