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ALASKA AIRLINES UPDATES: Bye Horizon Brand – Boeing 737-900s – Record Income – On time Performance & More

This will become the new livery of Horizon Air...er I mean Alaska Airlines operated by Horizon Air. Click for larger.

This will become the new livery of Horizon Air...er I mean Alaska Airlines operated by Horizon Air. Click for larger.

The fine media folks over at Alaska Airlines had quite the day yesterday. They were very busy announcing all sorts of exciting things. I am sure some of this stuff you have already heard, but maybe some you haven’t.  Here are some of the announcements:

HORIZON LOSES OWN BRAND, GAINS ALASKA’S:
As an Alaska Airlines/Horizon fan and one that loves liveries, this is huge news.  On January 1, 2011, Horizon Air stopped flying under its own brand and for most people, this was not an obvious change. Instead of flying their own routes and doing their own marketing of their routes, they started flying 100% via capacity purchase agreement under Alaska Airlines. At the time, questions started to surface on what Horizon’s future would be. Horizon could have been sold off, started to fly for other carriers or be absorbed completely under the Alaska brand. Yesterday, Alaska announced they will be re-branding Horizon with the Alaska brand. This means the sun on the tail will be replaced with the familiar Eskimo. Over time, all of Horizon’s fleet will be repainted in Alaska colors with some Horizon lettering.

If you love those Horizon Q400′s in university livery (go Dawgs!), do not worry, Horizon stated via their Twitter account, they are here to stay. Just because the outer brand will be changing, doesn’t mean the Horizon brand of service will be changing. You will still get the Ala Cart baggage service, flight crew uniforms and of course that free beer and wine you can get with every flight.

I have always enjoyed the Horizon Air livery on the Q400′s, but I have to say, Alaska’s livery on the aircraft looks slick. Normally a change like this will look odd and takes some time to get used to (ie United’s new livery), but this just seems natural. The “Horizon” after the Alaska name looks odd, but my guess is the “Horizon” will be removed as passengers get used to the new, combined brand.

This makes sense. A lot of sense. Horizon and Alaska have been operating under the Alaska Air Group since Horizon was purchased in 1986, but they have remained pretty separate. There has been a lot of overlap between the companies, where they did things separately. Not only will this move save money in advertising one brand, instead of two, but it also allows them to merge offices and jobs. This can secure both the futures of Alaska and Horizon Air and should make it easier for the airline to swap out aircraft between the mainline Boeing 737′s and Horion’s Q400′s when needed and possible.

RECORD PROFIT:
This is a booming time for the airline business. Many of the airlines are seeing profits they haven’t seen in years — or ever. Alaska is one of those that is very much enjoying the boom. They reported their 4th quarter 2010 net income as $47.4 million. That is not bad, especially seeing how they only made $4.4 million during the fourth quarter 2009.  The entire Alaska Air Group has $1.2 billion in unrestricted cash and marketable securities at December 31, 2010. Adjusted debt-to-total capital ratio of 67% — lowest leverage since 1999.

Anytime airlines make a profit, some people seem to want to punish them. Asking for lower fares and removal of fees. Please. They are a business and need to save up money and reinvest money for future growth. I think we should all be happy for the airlines and especially Alaska for making such impressive profits.

ADDITIONAL BOEING 737 ORDERS:
Alaska announced they have ordered an additional 13 Boeing 737-900ER’s, which will will have the new Sky Interior. Alaska hopes to start taking delivery in 2012 and to be completed by 2014. Alaska posted a photo of the proposed new Sky Interior on their new 737′s via Twitter yesterday, which is small, but at least gives you an idea of what it will look like. Boeing released a computer generated photo of what the Alaska Air Boeing 737-900ER will look like (spoiler: no big surprises, but still cool photo). Dan Webb via his blog, Things in the Sky, took a closer look at what this order means for Alaska so no point in repeating his findings.

OTHER ANNOUNCEMENTS OF INTEREST:

* Alaska Airlines holds the No. 1 spot in U.S. Department of Transportation on-time performance among the 10 largest U.S. airlines for the last twelve months.
* Alaska Airlines reaches a tentative agreement with its IAM-represented employees – including customer service agents, reservations agents, and certain clerical staff.
* Horizon Air’s mechanics and pilots ratify long-term labor contracts.
* Alaska will be retiring all the CRJ-700′s in the Horizon fleet by the end of 2011. Although I love the Q400′s, it would have been nice to see a CRJ in Alaska livery — oh well.

Although some will be sad to see the Horizon brand will vanish over the horizon (sorry, couldn’t help myself), it does mean that the Horizon you have gotten to know and love will be going anywhere. All these changes is great news for Alaska and in turn for many of those that fly in and out of Seattle and the western United States. Alaska has done an amazing job of growing in to new markets an providing a high level of service for their customers. I see that these changes will only help Alaska continue to succeed and grow.

13 comments to ALASKA AIRLINES UPDATES: Bye Horizon Brand – Boeing 737-900s – Record Income – On time Performance & More

  • Jonathan Anderson

    I can’t wait to see the first q400 in the new livery! I felt the same way about the livery, I loved it the first time I saw it. I do wish they would take Horizon off the side, it looks out of place, but like you said maybe that will go away.

    Something also of important note here is that SkyWest will be taking over the longer routes that Horizon currently operates, and they will be doing it in a CRJ700 under Alaska in their livery.

    IMHO, an otherwise great day for the Alaska Air family!

  • Jonathan, I read Alaska’s press release, and scrutinized SkyWest’s press releases page and did not see anything regarding SkyWest acting as a contract carrier for Alaska using CRJs on the longest routes currently flown by Horizon.

    Where did you see this?

  • Gordon Werner

    A few corrections.

    SkyWest will be flying the ex-Horizon CRJs in Alaska colors (either as Alaska or Alaska Express.)

    The 737 order is for 13 737-900ERs & 2 737-800s.

    Alaska has not decided whether to certify the 900ER fleet for ETOPS. Currently the plan is to use them for Transcontinental flights. &/or West Coast runs that need extra capacity.

    Alaska might also move some Q400 flying up to Alaska.

  • Gordon Werner

    Here is the announcement from Alaska

    SkyWest acquiring Horizon’s last 5 RJs;
    Q400s may start flying in state of Alaska

    January 25, 2011

    Alaska Air Group announced today that Alaska Airlines has reached an initial agreement for SkyWest Airlines to acquire the five remaining CRJ-700s in Horizon Air’s fleet and operate them under a capacity purchase agreement. Alaska also announced it is considering the deployment of Horizon Q400s on some state of Alaska routes.

    Andrew Harrison, vice president of planning and revenue management, and Joe Sprague, vice president of marketing, answer questions related to these two moves.

    Why is Alaska entering into a CPA with SkyWest?
    Harrison: Horizon’s financial success depends on its transition to an all-Q400 fleet so it can reap benefits equivalent to what Alaska gained from its own transition to the Boeing 737. That leaves a few longer routes that, for competitive and economic reasons, we need to keep serving with regional jets. SkyWest will fill that need.

    What routes will SkyWest be flying?
    Harrison: We’re still evaluating that and expect to have an answer in the next month or so. As always with major market changes, we’ll let employees, vendors and airport authorities in these cities know before we announce publicly. What I can say at this point is that SkyWest will primarily be flying the CRJ-700s on some of our longer-haul West Coast routes currently served with the aircraft, but not all of them. Those others will be served by Horizon with the Q400.

    Why not have Alaska fly its own jets on these routes?
    Harrison: We’ve found that larger jets don’t work well on these routes.

    Why is SkyWest flying these routes instead of Horizon?
    Sprague: Horizon will not be able to capture the economies of a single fleet until all of its CRJ-700s are gone. In addition, with hundreds of regional jets in its fleet contracted to fly for numerous other customers in similar CPA arrangements, SkyWest has economies of scale that Horizon cannot match.

    When will the last five CRJ-700s begin leaving Horizon’s fleet?
    Harrison: The current plan is for the last five Horizon CRJ-700s to transition out of Horizon’s fleet starting in April. All current Horizon CRJ-700 flying will either be flown for Alaska with a Horizon Q400 or with a SkyWest CRJ-700 by summer. In order to get the SkyWest CRJ-700s painted in their new livery, some of the flights may need to be temporarily operated with SkyWest 50-seat regional jets until all the CRJ-700s are repainted.

    What will be the livery on the SkyWest CRJ-700s flown for Alaska?
    Sprague: These SkyWest CRJ-700s will likely sport a version of the Alaska livery. A final decision on this is expected shortly.

    Many of our competitors offer a first class cabin on their regional airline partners. Will there be a first class on these SkyWest-operated Alaska flights?
    Sprague: Some the majors offer first class on their regional partners as a way to attract very lucrative international business and first class passenger connections. The vast majority of our customers on these SkyWest-operated routes are traveling domestic point-to-point and are very price sensitive. Our experience is that relatively few customers purchase first class seats on our short routes. We believe we’ll gain more revenue by having more seats in a single-class configuration, lowering our per-seat cost and allowing us to remain competitive with the likes of single-class competitors like Southwest and JetBlue.

    Will SkyWest offer complimentary Northwest wines and microbrews like Horizon?
    Sprague: Yes. This enhances the inflight experience for all customers, including those who would have preferred a first class cabin had it been available.

    Why would we want to operate Horizon flights in the state of Alaska?
    Harrison: In looking at the average demand for air travel on some intra-Alaska routes, we see in many cases that demand could be accommodated with a 76-seat Q400 and at a lower cost. Replacing Alaska mainline flying with the Q400 would allow us to reduce costs and lower fares on the routes and give us the opportunity to re-deploy 737s on other routes where they can be more profitable. Our commitment to air cargo in the state of Alaska remains unchanged, and that service will continue to be provided primarily by Alaska Airlines, due to the size and quantity of cargo involved.

    When could we see the first Horizon Q400s in the state of Alaska and where would they operate?
    Harrison: It’s too early to tell, because it’s not a done deal yet. Scheduling people in my group and operations folks at Horizon and Alaska are working up possible scenarios. Should we decide to proceed, it would likely involve two or three Q400s and would not take place before the end of this year. Once we arrive at any decisions, we’ll get the word out.

  • [...] This post was mentioned on Twitter by Ramon Spearman, David Parker Brown. David Parker Brown said: Lots of interesting announcements from @AlaskaAir & @horizonair. Check them all out: http://bit.ly/gFENI5 [...]

  • I’m not sure that I’d say that the Horizon “Brand” isn’t flying any longer….it is. They are still a separate airline, still have “Horizon Air” painted on their aircraft. But they are doing CPA flying for Alaska. Things will be evolving over the course of this year — in wild sorts of ways! But at this point at least, Horizon is still flying under their own brand.

  • [...] ALASKA AIRLINES UPDATES: Bye Horizon Brand – Boeing 737-900s – Record Income – On time Perform… [...]

  • [...] their combination of cheap fares, high level of service and all Boeing 737 fleet (okay, I guess Q400′s now too). Recently I flew from Tuscon (TUS) to Seattle (SEA) in First Class on Alaska which I haven’t [...]

  • [...] they would get rid of the CRJ-700s and only fly a fleet of Bombardier Q400s). Shortly thereafter, Alaska announced they would absorbthe Horizon brand. Now, Alaska Airlines has contracted out with Skywest to fly Bombardier CRJ-700 regional jets on [...]

  • [...] they would get rid of the CRJ-700s and only fly a fleet of Bombardier Q400s). Shortly thereafter, Alaska announced they would absorbthe Horizon brand. Now, Alaska Airlines has contracted out with Skywest to fly Bombardier CRJ-700 regional jets on [...]

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