Buying VX...
 

Hindsight is always 20/20. No one could have predicted the coronavirus shutdown, and I’m not an Alaska insider. But while I don’t even hold stock directly, I own a little of Alaska through a couple of different mutual fund purchases, so I am asking those more knowledgeable than me; Did any good come out of the VX acquisition?

I’m not trying to play the blame game, just curious. It appears to me that VX was bought pretty much as a defensive move to keep them out of what Alaska considered to be ‘their’ turf in California. Shortly after, that Alaska sold off the east coast assets and doesn’t really appear to want the A320 aircraft.

Judging by the APC threads the VX pilots were less than enthused about the acquisition. The senior guys felt compelled to stick because seniority is seniority, but some were really upset with losing East Coast basing. The junior VX FOs - well, some stuck and some jumped to other majors back when they were hiring.

So in they end all that Alaska seems to have gotten was less competition in California and a number of pilots too senior to go anywhere else, and pre-COVID and apparently facing a pilot shortage that might have been reason enough to buy VX. But that wasn’t the scenario that fate chose to play out.

While no airline is unscathed in this mess, the Big Three have been hurt particularly badly by the loss of international flying and Alaska by the loss of Hawaii flying.

The way it looks right now, Alaska, UAL, and DAL are downsizing and retrenching, which will open up gates in the very areas Alaska bought VX to defend. AA looks like they are betting on an early comeback, perhaps because with their debt load if they don’t get one they are heading for bankruptcy anyway. SWA and the ULCCs seem to be planning to compete aggressively as well, in hopes of gaining domestic market share in some of the very areas that Alaska bought VX to defend.

And it looks like we have - temporarily at least - an actual glut of well qualified but soon to be furloughed airline pilots.

So I’m not casting stones, no one could have anticipated the black swan event, but merely asking the question. Did Alaska actually gain anything by the VX acquisition?

It got rid of a competitor, it kept B6 from entrenching themselves on the west coast, and allowed Alaska to rapidly expand to help fend off competition in key markets (Seattle).

Good answer. Now the let's see if how long it takes for this to turn into a ****ing match.

How did it affect B6? Genuine question.

People much smarter than you made the decision. How about this, instead of posting a bunch of pointless words under an even more pointless thread, go get yourself a juice box and let the adults make the big boy decisions.

So you have no actual answer? Just vitriol?

You came to the wrong place if you want honest answers and no snark.

Welp. That didn’t take long.

OP. Excellent troll post. 10/10. Kudos


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B6 was the other realistic buyer (A foreign carrier and Delta were supposedly the others) in the bidding war that ultimately drove the price up. They then had to either grow organically on the west coast or find another partner to merge with.

I haven't followed their expansion so i'm not going to comment on how that's gone.

The rational to buy VX at that time made sense...

Like you said, hindsight is 2020. If Corona had hit in 2016, the year the deal was consummated, maybe it would have been unnecessary to do so, as there's a great chance VX would've folded.