Alaska Airlines has been a proud single-aircraft family operator of the Boeing 737 since retiring its last Boeing MD-80 in 2008.
That will change if shareholders and US regulators approve the Seattle-based carrier’s planned acquisition of Virgin America, which was announced today.
“We are acquiring a great fleet of young, fuel efficient airplanes,” says Brandon Pedersen, chief financial officer of Alaska, during an investor and media call on the deal. “We are big believers in single fleets, in fact so much so that we bought another single fleet [airline].”
Virgin America operates a fleet of 60 Airbus A320 family aircraft, including 10 Airbus A319s and 50 A320s, Flightglobal’s Fleets Analyzer shows. CFM International CFM56 engines power the entire fleet.
The Burlingame, California-based carrier also has orders for three A320s and 30 A320neos, as well as 10 Airbus A321neos leased from GECAS, Fleets Analyzer shows.
Alaska is not sold on keeping the A320 family aircraft but will weigh its options.
“Virgin America leases the vast majority of its fleet, so we can transition to a single fleet – if we should chose to do that – starting in 2020,” says Pedersen.
Virgin America leases 85% of its fleet, Fleets Analyzer shows. GECAS has the largest exposure with nine aircraft placed at the carrier and the 10 A321neos on order, followed by Aviation Capital Group with six A320s and AWAS and Goshawk with five aircraft each.
In addition, Alaska could cancel Virgin America’s order for A320neos, which are due to arrive from 2020 through 2022, says Pedersen.
“That order has a pretty favourable cancellation provision, not suggesting at all that we’re going to do that but it’s something we could do if in fact we move in a different direction,” he says.
Alaska has a different approach to fleet from Virgin America. It operates a fleet of 737s and owns, rather than leases, the vast majority of those aircraft.
Alaska operates 151 737s, including 26 737-400s (including Combis and freighters), 13 737-700s, 61 737-800s and 51 737-900/900ERs, Fleets Analyzer shows. Only 20 aircraft, or 13%, are leased.
GECAS is also Alaska’s largest leasing partner, owning eight of the 737-400s in the airline’s fleet, Fleets Analyzer shows. BOC Aviation is its second largest partner with five 737-800s.
“We like a single fleet, yes,” says Ben Minicucci, chief operating officer of Alaska, during the call. However, he is quick to say – as other executives do – that the carrier is keen to learn about the Airbus and will evaluate whether it wants to keep the fleet or transition back to a single type.
Alaska’s wholly-owned subsidiary Horizon Air operates 52 Bombardier Q400s, Fleets Analzyer shows.
The airline had also contracted SkyWest Airlines to operate nine Bombardier CRJ700s and five Embraer 175s at the end of 2015, a SkyWest fleet plan shows. However, the CRJ700s will be replaced by 10 E175s this year.
Virgin America does not have a regional partner.
Alaska continues to evaluate the Bombardier CRJ900 and E175 for a planned order of 30 aircraft for Horizon Air that it announced in January. The aircraft will replace at least 20 Q400s.
“We are going to go forward with our regional jet order,” says Mark Eliasen, treasurer of Alaska, during the call today. An announcement is expected in the next few weeks, he adds.
Source: Cirium Dashboard