Alaska Air Virgin America
Last week Alaska Air announced that it will acquire Virgin America for $2.6B.
This was surprising news to many as Alaska operates all Boeing 737 aircraft while Virgin America operates Airbus equipment. In addition, Alaska Air is more traditional and Virgin America is hip and trendy.
Alaska explained that it is purchasing Virgin America for the following reasons:
- Expanded presence for Alaska Airlines in California and a network total of 1,200 daily departures.
- Expected to increase annual revenue 27% to over $7 billion and offer $225 million in net synergies.
- Combines two airlines known for “outstanding customer service and low fares.”
Alaska Airlines hub is in Seattle and they have a limited route schedule on their own aircraft; however, they have codeshare flights with both American Airlines and Delta which opens up a lot of options.
In addition, Alaska has traditionally been an excellent award travel program as they have partnerships with multiple airlines and allow for some amazing redemptions. Unfortunately, recently some of those redemptions have been de-valued; however, the program is still an excellent one.
Virgin America is quirky as it combines the UK based Virgin Brand and it targets the trendy traveler market.
Virgin America has a large West Coast presence which can further enhance Alaska’s footprint.
I’ve traveled on Alaska Airlines once or twice, and I have enjoyed the experience.
I haven’t been on Virgin America; however. I experienced their lounge at LAX and thought it was pretty cool with the specialty drinks and great views of the tarmac and runways at LAX. The lounge had a modern feel. It will be interesting to see how that gets incorporated into the Alaska Board Rooms as they are classic “board room” type decorations rather then hip and trendy.
The differences between the aircraft cabins is substantial as Alaska Air has a more simple old fashioned style cabin while Virgin America is trendy and modern and makes use of color changing lighting.
Where I live in Minneapolis, Virgin America has not had a presence, so the only option for traveling on Alaska was the couple flights a day to Seattle or a codeshare on Delta or American.
Alaska Air published the following illustration regarding the merger:
The new route network opens up more flights from the East Coast and South which will certainly be a plus for the airline.
It will be interesting to see if some of the modern aircraft interiors and trendiness of Virgin America will be incorporated into the more classic Alaska Air.
What do you think about the merger?
Photos: Alaska Air, TravelCodex, OPB.org