Alaska and Hawaiian Airlines are the latest American carriers seeking to merge. The merger avoided any objection from the U.S. Department of Justice and is one step closer to becoming reality.
If these two airlines, ironically representing the last two states to join the United States, finally merge, what does that mean for customers?
Hawaiian Airlines' Future
Alaska first announced its acquisition of Hawaiian Airlines in 2023. The deal was worth $1.9 billion and, if successful, would mark the largest consolidation of any U.S. carrier since 2016.
The biggest concern of the merger was what would become of the beloved Hawaiian Airlines brand. Alaska clarified that they would keep the Hawaiian brand distinct along with local Hawaiian jobs and frequent inter-island service.
In a statement disclosed earlier this week, Alaska mentioned that it was working closely with the State of Hawai'i's Attorney General to reinforce its commitment to Hawaiian Airlines' future.
The carrier noted that it will, "...complete work to close the transaction, and proceed with integrating the two companies, welcoming Hawaiian Airlines guests and employees into Alaska Air Group, and expanding benefits and choice for consumers throughout Hawai'i, the Asia-Pacific region, continental United States, and globally."
Hawaiian Governor Josh Green also released a statement saying that he and his staff have been working with Alaska Airlines to carefully review the potential impacts of consolidation.
Green noted that Alaska has reinforced commitments to the Hawaiian market. The carrier will work to preserve and grow union jobs in the state along with continuing to provide crucial passenger and cargo service between the mainland and the islands.
Furthermore, Green expressed his confidence that the Alaska-Hawaiian merger would enhance competition and offer more travel options for Hawaiian Airlines customers.
What About Customers?
Alaska Airlines joined the OneWorld alliance in 2021. Earlier this year, there was talk about Hawaiians potentially joining OneWorld following the Alaska acquisition. Further news regarding this move will likely follow after the official takeover as Hawaiian has not made any further announcements regarding joining OneWorld.
However, Hawaiian noted in its official statement regarding the merger that customers will benefit from increased loyalty program benefits. While not officially part of OneWorld yet, customers can earn and redeem miles on 29 global airline partners and receive elite benefits on all OneWorld member airlines. Hawaiian Airlines passengers will also receive expanded global lounge access for these airlines if those passengers meet the mileage or status requirements.
Other benefits from the merger include increased connectivity across the Asia-Pacific, U.S. mainland, and Caribbean regions. Furthermore, the merger will triple the number of mainland destinations that can be reached from the islands along with making Honolulu a more strategic hub for Alaska Airlines.
However, when it comes to competition, there are varying views.
Brandon Ingram, Hawaiian's CEO, stated that his airline "felt very good" about the competition because they felt it was pro-consumer and pro-competition. This is a similar view held by Governor Green.
On the contrary, travel experts say that the merger would decrease competition.
Katy Nastro, a spokesperson for Going.com, told ABC News that the merger would decrease the number of cheap flights for consumers.
If more airlines compete against each other in a market, there is a higher likelihood that ticket prices will be lower thanks to a greater number of players. However, the fewer the number of airlines, the more influence a specific airline could have in that market, meaning they can price tickets as they wish. This seems to be the reasoning that travel experts are using to assert that the Alaska-Hawaiian merger could lead to rising ticket prices.
Another issue is that the Justice Department did not require concessions from Alaska Airlines to let the merger go through. This means that certain markets that underperform in Alaska's view could be cut or reduced significantly. While not specified which markets, this could include certain inter-island routes.
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