Alaska's Big Move in Seattle
Why'd you think it wanted those widebodies? Today is Alaska Air Group's investor day, and CEO Ben Minicucci plans to tell all of you how his company is playing to win. I got a preview.
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Alaska is making a lot of news today — and let me just say up front that you can hear Alaska Air Group CEO Ben Minicucci talk about it on this morning’s episode of The Air Show. It’s available on podcast apps now. You can also follow Alaska’s webcast today at 1 pm. Eastern.
Dear readers,
Few insiders expected that Alaska Air Group would spend $2 billion merely so that it could acquire and run a failing regional airline in the South Pacific. But as Alaska’s executives meet today in New York with investors to share how they’ll redeploy Hawaiian’s fleet and revamp its network, we now know that Alaska will use many of Hawaiian’s assets to try to win the Pacific Northwest.
But it’s potentially more than that. Alaska also wants to morph into a bonafide global premium airline, on par with American, Delta, and United — albeit on a smaller scale (at least at first). It will start in Seattle, where Delta has been on a decade-plus quest to poach Alaska’s customers by offering them premium services not only within the United States, but across the world. With its new global flying, Alaska plans to give its fans every reason to stay loyal.
We’ll see the first tranche of this strategy in May, with new service from Seattle to Tokyo Narita, followed by flights to Seoul Incheon in October. And while that’s all the destinations the airline is sharing today, Minicucci made clear to me and my co-hosts (Jon Ostrower and Brett Snyder) on The Air Show that this is not just some JetBlue-style peak-season cash grab, but rather the start of a real and sustained strategy to meet what it believes the market wants.
"Seattle is our hometown," Minicucci said. "It's our hub. This is the nexus of Seattle, and we will never give up Seattle to anybody, which is why we've grown Seattle market share as much as we did in the last 10 years and never gave an inch. And so we're here to stay, and now with international flying, we believe that we can be extremely successful here, because we have the domestic strength, we have the loyalty, [and] we have people who love the hometown airline."
Minicucci, who became CEO in 2021, is an interesting character. He’s a gregarious and funny airline-lifer who started his career in 1997 at Air Canada and has spent 20 years at Alaska. But he’s not like Marty St. George or Scott Kirby, who seem to know everyone and have a story to share about all of them. Ostrower, Snyder and I remarked that none of us had ever met Minicucci, despite all of our years of experience.1
Minicucci came at us with a lot of swagger, and we felt he honestly answered all of our questions, including Ostrower’s very geeky airplane and engine questions and my query about the future of the Hawaii network (Don’t worry: it’s still very important.) For all of that, listen to the episode, which is available wherever you get your podcasts, including Apple and Spotify. And there’s no paywall.
That interview is a good complement to today's newsletter: a summary of the announcements Alaska is making, along with some of my thoughts about whether Minicucci can deliver on what he promises. Keep reading to learn what Alaska plans with its Seattle long-haul operation, how it plans to achieve far more financial synergy than it had told Wall Street a year ago, and how it expects to add more premium products and services that today's customers demand.
Let’s get into it.