At Seattle-Tacoma International Airport in Seattle, Alaska Airlines planes are parked in front of the gates at sunrise, with Mount Rainier in the background.
AP/March 1, 2021
According to Alaska Airlines, Alaska Airlines and Hawaiian Airlines have cleared a major regulatory hurdle in their plan to combine operations.
The nearly $2 billion deal, the first airline merger in nearly a decade, is expected to significantly expand travel options from Hawaii to the U.S. mainland and expand Alaska Airlines’ international presence.
A deadline for the Justice Department to file a lawsuit challenging the merger passed without any action being announced. Statements from Alaska Airlines and the governor of Hawaii said the deal had reached a major milestone. The Justice Department did not immediately respond to requests for comment.
“The deadline for the U.S. Department of Justice to complete its regulatory investigation into the proposed merger of Alaska Airlines and Hawaiian Airlines has passed,” Alaska Airlines said in a press release late Monday.
According to Alaska Airlines, the merger still needs to be approved by the Department of Transportation.
The announcement came as a surprise to some in the industry, as the Biden administration had promised to closely scrutinize mergers in already highly concentrated industries.
Alaska Airlines said the airline has worked closely with the Hawaii Attorney General to “reaffirm and expand” its commitments to Hawaiian Airlines and Hawaii customers, and that the company has agreed to retain the Hawaiian Airlines brand to protect local jobs.
In a statement, Hawaii Gov. Josh Green (D) said his administration has worked closely with the airline’s leadership to assess the potential impact of the merger and ensure the preservation of local union jobs. Green said the deal will expand access to the mainland for Hawaii residents.
“The merger will greatly increase the number of destinations across North America that Hawaiian residents can reach nonstop or with a stopover from the islands,” Green said.
In December, the two airlines announced their plans to merge, arguing that they had no choice but to join forces in an industry where four major airlines – American, Delta, Southwest and United – account for 80 percent of the market.
In February, the Justice Department launched an investigation into the deal. The airlines had originally sought a decision by August 5, but agreed to an extension to August 15, according to a government statement.
Alaska Airlines CEO Ben Minicucci told the Washington Post at the time of the announcement that the deal would bring together two companies that share similar values: connecting communities and people. Hawaiian CEO Peter Ingram stressed that there are no two states – Alaska and Hawaii – that rely more heavily on air service to connect them to the rest of the world.
Despite the merger, the two airlines will continue to operate under their own brands, Minicucci said, adding that there will be no loss of unionized jobs as the airlines are not making any changes to their networks. The two carriers only overlap on 12 routes, he noted.
As part of the agreement, Alaska also committed to opening a “significant” regional headquarters in Hawaii, similar to its offices in Alaska and California.
Alaska was also involved in the last major US merger in 2017, when it outbid JetBlue in its takeover of Virgin America.
This is a developing story and will be updated.
