Originally Posted by
Fishfreighter
Why would LUV want a Q400/RJ operation?
What does make sense is this:
1. In the Alaska Air Group annual report the board voted on a payout for Senior Management IF Alaska Airlines is sold out of the Air Group. $6M for the CEO, $4.5M for the CFO and the COO, $3.5M for the ex-VP of Flight Ops who is currently on a consulting contract.
2. They are accelerating the MD retirements.
3. Alaska has enough cash/cash equivalents in the bank to buy EVERY share of Alaska stock and leave about $300M.
4. The Air Group has had the EMB-190/195 on site in PDX showing them to Horizon folks.
So, here's the scenario. Alaska Air Group sells Alaska Airlines to whoever (LUV, DAL, etc.). The Senior Managers make a killing not only on the specified cash payout, but on their stock/stock options as well.
They sell off all their Union problems. The only labor groups unionized at Horizon are the pilots and F/As.
They then take the money from the sale of Alaska and acquire a bunch of Ejets. The Horizon guys are enamoured with a bigger plane and agree to fly it for CRJ wages.
If history is any predictor, whoever buys Alaska will soldier along on the West Coast for a couple years and eventually strip the assets and put them into their East/West operation. AA did it to AirCal and Reno. USAir did it to PSA. Delta did it to Western.
The Air Group then fills the void using Horizon's Q400s and Ejets, having discarded the CRJs as the Ejets came on board. The Senior Managers laugh all the way to the bank.
What about the Alaska pilots? If the Morris deal was an indicator, they'll probably be stapled to the bottom of the LUV list, but pay protected in their current seat positions. There are plenty of Alaska Captains who would pull gear for $196 an hour.
First, I don't think WN would have much interest in the CRJs, but the Q400 would allow them to access a lot of smaller markets at a cheaper cost than the legacies who have large RJ operations.
The second point I'd like to make is that I find it very unlikely that Horizon's pilots would agree to fly a 90 seater for the same rates as the CRJ-700. Actually, I'm pretty sure the Union's first reaction to any such proposal would be laughter, soon followed by disgust when they realized that management was serious.
Another thought I had was about anti-trust concerns. Much as UA and US was determined by the DOJ to control too much of the east coast, AS and WN might have the same problem just on the other side of the continent. I believe they are the two largest carriers up and down the west coast.