Alaska Airlines announced plans on Sunday to acquire Hawaiian Airlines in a $1.9 billion deal.
The combined airline will maintain the Alaska Airlines and Hawaiian Airlines brands but with a single operating platform, Alaska Airlines said in a news release. The company would serve 138 destinations, including non-stop flights to airports in the Americas, Asia, Australia and the South Pacific.
For Hawaii residents, the company would offer three times the current number of destinations from the state to destinations throughout North America, either nonstop or with a connection.
“At Alaska Airlines, we join an airline that has long served Hawaii and has a complementary network and shared service culture,” Peter Ingram, president and CEO of Hawaiian Airlines, said in the news release.
The deal is likely to face close scrutiny from federal regulators. The Justice Department has aggressively enforced antitrust laws during Biden’s presidency, filing lawsuits to prevent mergers, acquisitions and other deals that could lessen competition in various industries, including aviation.
Last year, the department successfully sued to block a partnership between American Airlines and JetBlue Airways in New York and Boston. He is also currently suing to stop JetBlue from buying Spirit Airlines. A federal trial on that lawsuit is expected to conclude this week, with closing arguments scheduled for Tuesday.
The Spirit acquisition is expected to deliver the rapid growth that JetBlue has eluded in recent years. In 2016, JetBlue lost a bidding war with Alaska for Virgin America.
The airline industry in the United States is dominated by four airlines (Delta Air Lines, American Airlines, Southwest Airlines and United Airlines), all of which reached their size with the help of mergers. United, the fourth-largest airline, controls about 16 percent of the market, according to federal data. Alaska is the fifth-largest airline, with 6.4 percent, followed by JetBlue, with 5.5 percent.
If the Spirit sale is allowed to continue, JetBlue will grow to control more than 10 percent of the market. If Alaska is allowed to buy Hawaiian, the combined company will control just over 8 percent of the market.
The Association of Flight Attendants union, which represents about 9,000 flight attendants in Alaska and Hawaii, said its support for the deal would depend on benefits for workers.
“Our first priority is to determine whether this merger will improve conditions for flight attendants, as well as the benefits the companies have described for shareholders and consumers,” the union, which also has members at other airlines, said in a statement. “Our support for the merger will depend on this.”
This is a developing story. Please check back for updates.
