There has been much discourse online since Alaska Airlines and Hawaiian Airlines announced their intention to combine. It looks like a very good decision on paper, with networks that have little overlap and culturally both airlines share a service ethos.
Quite a bit of talk has been from people thinking that the Hawaiian Airlines brand will eventually be consigned to history. This is in spite of the fact the press release clearly says they will “preserve both beloved brands”.
It Can’t Be Done Here
The prevailing sentiment seems to be that people feel it’s impossible in the good old United States of America to have one operation with two brands. Many people point to the history, such as United’s short-lived Ted offshoot, or Delta’s equivalent, Song.
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- Song’s Boeing 757s.
Others point to Virgin America, which was purchased by Alaska Airlines and absorbed completely, with that brand disappearing. I understand why people think the way they do, as historically this hasn’t worked. However, this merger is a very different beast.
Hawaiian Airlines Will Stay
One success story in this area is Qantas and Jetstar. The Australian’s created the low-cost offshot and let it run with its own staff, its own CEO, aircraft and so on. It has been very successful for the group, and has not impacted the main airline negatively at all, as there is definite segmentation between the two.
With neither Alaska Airlines or Hawaiian Airlines being a low-cost carrier, it is somewhat different. However, I would point to the Europeans for the example in this area.
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- Jetstar makes plenty of money for Qantas.
British Airways and Iberia agreed to merge in 2010, with both brands remaining to this day. Other airlines were then purchased, such as Aer Lingus, which also has kept its identity. They all have their own strategies, CEOs and so on, however some functions are shared group wide for economies of scale and purchasing power.
It’s the same with the Lufthansa group of airlines, and Air France/KLM. This model has been very successful in Europe and I imagine this is what Alaska Airlines will emulate. In the BA/Iberia example, Iberia went from being a loss making carrier, to a very profitable one. I’d see the same happening with Hawaiian under Alaska’s stewardship.
Overall Thoughts
I have a lot of respect for the people at Alaska Airlines. They run a tight ship, have recent merger experience and from a customer standpoint are one of the best airlines in the USA.
I fully believe that if they say they will keep both brands, that is exactly what will happen. It’s good news for both airlines and should strengthen them considerably.
What do you think of the Alaska/Hawaiian merger? Are you looking forward to it or not? Thank you for reading and if you have any comments or questions, please leave them below.
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Featured image via Alaska Airlines.
Song 757s by Anthony92931 via Wikimedia Commons.
Qantas and Jetstar by Bidgee via Wikimedia Commons.
The “BEAN COUNTERS” of Alaska will make that final decision on who stays and who goes. I personally think Hawaiian will disappear after 2 years into this merger.
I don’t know about that though. If the other airlines around the world can make it work, Alaska can do the same with Hawaiian. Time will tell, of course!
As a “Kama’aina” of these islands, I’ve seen it twice in the past, when a larger mainland company comes to Hawaii and purchase/takes over a smaller island company with terrible results for the islanders. Years ago, Bank of America took over Honolulu Savings and Loan. Financially it was a terrible investment, Bank of America closed up, and left town with no Bank of America to be found in Hawaii. Employees was left unemployed. MACY’s took over “Liberty House” and once again, Macy’s is not doing well financially. It started closing a few department within the store. As you said, time… Read more »
Interesting to hear some of that history. I hope it doesn’t repeat itself like those two other companies.
I think you have a point. But, then look at CVS. They bought Long’s, a cherished chain in the Islands. It would have been a very bad decision to mold them like the CVS’s on the mainland. Instead, the Long’s brand remained and allowed to “do business as usual”. So, it is possible.
I don’t believe Alaska will keep the culture in the company or the brand. Hawaii has seen this way too many times to count. Hawaii is a very unique place with a very unique and delicate culture. We are one of the most isolated places on Earth. Our islands and people have seen some of the fastest growth in the world and the highest rate of extinctions. Past the romance of the fantasy Hawaii congers, when people actually get to do business in Hawaii and experience the difficulties and expenses, they cut and run quicker than quick. It will be… Read more »
Thanks for that. It’s interesting learning the realities of doing business in Hawaii and the previous experience there. I guess we just have to hope the brand will stay. It would be rather odd to have Alaska on planes operating in the Hawaiian islands, that’s for sure. Appreciate that!
British Airways and Iberia did not merge. They are owned by the same capital firm, but are distinctive brands in their respective countries. They are part of the OneWorld alliance (just like AA and many others) and do both participate in the Avios program (which is also a separate entity). But they did not merge and remain completely separate companies. As for eliminating the Hawaiian brand name – if it saves a few pennies it will happen. Corporations are not there to care about history, legacy, and recognition. It’s about profit to the shareholder. If it’s a dollar higher in… Read more »
Well, actually, British Airways and Iberia did merge, and the merged organisation’s umbrella became IAG. That’s literally how it started – it wasn’t that IAG existed and then bought the two carriers. The ownership structure was based on the proportion of BA and IB that they merged into. Sure, I hear your point regarding the Hawaiian brand name. However, one doesn’t decide to fly within Hawaii and look for the Alaska Airlines website. There are a lot of reasons to keep the brand and that would be top of mind for most consumers. I don’t believe it will happen that… Read more »
The Hawaiian brand will live at least in the 717 and interisland routes. If they choose the A220 or E175 to replace it, it will, too. If they rotate 737-800 for a short time to spread out engine wear, that will be harder to keep the Hawaiian brand.
The 787s are a different matter. They could have a different livery on each side or just accept that some Seattle flights will use a Hawaiian plane and some Honolulu flights will use an Alaska plane.
I’d say they’ll also stay on the 787s. Alaska Airlines has no proper long-haul services and as long as the current Hawaiian flights make money, all the aircraft will continue to be deployed on those routes. It’s not as though they’d suddenly pull the aircraft to open new long-haul routes out of SEA, when AS just doesn’t do that at the moment. Be curious to see what happens though!