HONOLULU (HawaiiNewsNow) – Less than a day after getting federal approval, Alaska Airlines has already closed its $1.9 billion deal to buy Hawaiian Airlines.
Alaska made the merger a done-deal the same day the U.S. Department of Transportation allowed it to, and was ready to name the new top management team.
The merger passed review by the Justice Department Antitrust Division on Monday, and then on Tuesday, DOT notified the two carriers it has granted an exemption necessary to the deal. The exemption lets the carriers fulfill all their obligations regardless of which airlines is performing the service.
For example, it allows the new joint operation to execute international routes that currently fly under the imprimatur of Hawaiian Airlines. Resolution of this red tape issue allowed Alaska Air to execute its acquisition of Hawaiian Holdings.
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A wild card that turned up in the regulatory process could make decisions easier: The U.S. Department of Transportation, as a condition of approving the merger, secured several promises in writing.
Alaska agreed to legally enforceable commitments, in force for six years, to maintain all current interisland routes as well as key routes to the mainland — and it promised in writing not to sunset any frequent flier miles before merging its rewards programs.
In a first for DOT, it essentially took commitments Alaska had already made, and turned them into binding pledges. Since Alaska was already planning to do these things, it was content to commit to them to get the deal approved.
No one can be sure how long it will take to integrate the two carriers’ systems, and there remains one important concern for Hawaii — how many non-union office jobs will come to be regarded as redundant or will move to Alaska headquarters in Seattle?
Hawaiian employs 7,000 people, mostly in Hawaii. Alaska has already said it will maintain Honolulu as its second biggest hub after SeaTac. Hawaiian union locals endorsed the merger.
Hawaiian has faced a confluence of financial headwinds in recent years — the COVID travel slump, the subsequent Japan travel slump, the Maui wildfires, and inter-island fare wars following Southwest Airlines entering the interisland market. Southwest and Hawaiian have sometimes sold inter-island tickets below cost to try to gain and keep market share.
“This is a historic day for Alaska Airlines as we officially join with Hawaiian Airlines. Alaska and Hawaiian share tremendous pride in connecting communities with award-winning service, and we look forward to inviting more guests on board to experience what makes both brands unique,” said Ben Minicucci, CEO of Alaska Air Group.
So what does this mean for travelers?
For travelers, this partnership means there’s a lot to look forward to in the next 18 months, including expanded benefits and choice. While nothing significant changes to the guest experience immediately, Alaska Air says guests can start experiencing meaningful benefits of the merger very soon and in stages.
With the partnership, Alaska and Hawaiian enables guests to reach 141 destinations directly, including 29 international markets and over 1,200 destinations globally.
The general plan is to improve the two websites, reservation systems and rewards programs until they can easily be merged because they are the same.
What’s going to happen to Hawaiian Airlines?
Honoring its rich history and deep legacy, Alaska Airlines said Hawaiian Airlines will continue to keep its brand.
Both airlines will maintain their distinct brands but leadership will see a noticeable change in management. Most of Hawaiian’s interim leadership team are the vice presidents of Hawaiian, doing the same job as before, but Hawaiian CEO Peter Ingram steps aside, while Alaska executive Joe Sprague steps up.
Alaska’s Hawaii manager Daniel Chun will head community and government relations.
With the acquisition, it has created a company with 33,000 employees and 350 aircraft. Until a single operating certificate is issued, the company has two — one for each airline.
In the Hawaiian management, CEO Peter Ingram will step aside in favor of Alaska executive Joe Sprague, and he will leave an interim team running Hawaiian that includes key executives from both carriers.
When the FAA grants a single operating certificate, Alaska reaffirms it plans a single operation with two public-facing brands. DOT said Alaska committed in writing to keep key Hawaiian routes to the mainland and current inter-island flights. These promises are legally enforceable for years.
Here are changes to expect within the next couple months, according to Alaska Airlines’ website:
Effective Sept. 18:
- Alaska’s Mileage Plan and Hawaiian Miles retain their full value
- Alaska Lounge members and guests can enjoy Alaska Lounge locations when flying on Hawaiian
- Hundreds of flyers have accrued more than one million miles or more flying Hawaiian Airlines. Alaska says they’re showing appreciation for their business with new benefits.
In coming weeks
- You’ll soon be able to transfer miles between Alaska and Hawaiian loyalty accounts to redeem award travel at no charge.
- Buy tickets for flights on both airlines on both websites. For example, you’ll be able to buy tickets for most Hawaiian flights on alaskaair.com and buy tickets for Alaska flights on hawaiianairlines.com. Alaska will soon offer the option to purchase flights to Japan, South Korea and Australia.
- A new travel program is in the works for Hawaii residents and it’s called Huaka’i (voyage). It will include unique discounts and benefits exclusively for Hawaii residents, including a 10% off one booking per quarter for inter-island travel. Learn more here.
In coming weeks
- You’ll be able to accrue Mileage Plan miles or HawaiianMiles when flying either airline.
- In early 2025, you’ll be able to redeem your Mileage Plan miles directly on all Hawaiian flights including international destinations. And you’ll be able to combine Hawaiian flights with Alaska or partner flights when redeeming your miles.
- If you’re an elite flyer with Alaska or Hawaiian, you’ll be able to link your accounts to automatically enjoy equivalent status on the other airline. If you have elite-qualifying miles (EQMs) in both programs, your status will be based on the highest tier you qualify for based on your combined EQM total.
Longer term benefits:
- Elite Reciprocity: Mileage Plan and HawaiianMiles elites will enjoy select elite benefits when flying on either airline.
- A single, industry-leading loyalty program across both brands. More details to come mid-2025.
For more information on the merger impacts, click here.
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