New Hawaiian Airlines CEO Joe Sprague told Neighbor Island reporters in a virtual press conference Wednesday that Alaska Airlines’ $1.9 billion acquisition of Hawaiian will provide “a tremendous boost to the utility that our airline will be able to deliver.”
“There will actually be three times the number of destinations that folks in Hawaii can access throughout North America on a single airline with either a one-stop or a nonstop flight,” said Sprague, who was Alaska’s regional president of Hawaii and the Pacific, and succeeds former Hawaiian CEO Peter Ingram, who stepped down after the merger became complete on Wednesday.
Sprague added the merger will make Hawaiian a member of the “oneworld Alliance” of airline partners that will give Hawaiian “a global reach.”
“It’s a powerful element of this combination, perhaps the most powerful,” he added.
The combined reach of Hawaiian and Alaska now brings nonstop or one-stop service from Honolulu to destinations including Chicago, Denver, Washington, D.C., Toronto, New Orleans, Nashville and Miami — with HawaiianMiles members able to use their miles on Alaska Airlines flights, as well.
“The reality is, by the bringing together of these two networks, the number of destinations, the number of places that HawaiianMiles members will be able to redeem their miles to travel to will now go up exponentially,” Sprague said. “And so the value of the miles that someone is holding today in the HawaiianMiles program just got much, much better.
“Within the next few days, we will be turning on the functionality so that you can very easily transfer your HawaiianMiles into an Alaska Mileage Plan account you can use to fly anywhere on Alaska Airlines — and globally, on our oneworld Alliance members. Longer term, because it will take a little longer from a systems integration standpoint, by mid-next year, we hope to combine the Alaska Mileage Plan with the HawaiianMiles program so there will just be a single loyalty program after that, which will make it much easier an efficient for all of our members to use their miles to fly anywhere on Alaska or Hawaiian or our partner airlines.”
The combined fleet of the two airlines is now 350 aircraft, according to Sprague, with the Seattle-based Alaska operating 286 planes, mostly Boeing 737s, and Hawaiian Air adding 64 aircraft, including the wide-body, 300-seat Boeing 787s and 278-seat Airbus A330s, and the smaller Airbus A321neos and Boeing B717-200s.
“Part of the reason for bringing Hawaiian Airlines and Alaska together is so that we can more effectively compete, ourselves, against the much larger airlines in the U.S.,” he said. “… The ‘Big Four” airlines — Delta, United, Southwest and American — those airlines control more than 80% of the domestic U.S. airline market. And Alaska Airlines is a distant fifth, in terms of the ranking — and even with this combination with Hawaiian, we’ll still be a distant fifth.
“… But importantly, by coming together, we will have greater resources, we will have a stronger network. And that’ll allow us to compete more effectively against those larger carriers.”
Sprague said Hawaiian also will keep its commitment to “maintain robust air service to the Neighbor Islands, at levels essentially what you see today.”
“Earlier this year … Alaska Airlines formed a community advisory board here in the state of Hawaii,” he said. “And it’s made up of 16 members, a fantastic, diverse group of individuals — community leaders, business leaders who are super regular flyers and understand the air service needs here in Hawaii. And we have a member, at least one person, from every single island, including Lanai and Molokai. We’ve already had three meetings with them, and they’re providing tremendous input to us.
“The purpose of this advisory board is for them to hold us accountable for how we’re providing service to the residents of Hawaii.”
The airline also is rolling out the Huaka‘i by Hawaiian program, exclusively for kama‘aina.
“HawaiianMiles members will be able to sign up at no charge for this new program. And the focus behind it will be to deliver exclusive benefits for residents of Hawaii — and each of those benefits will be steps that will bring down the cost of air travel for residents of Hawaii,” Sprague said.
When traveling interisland, Huaka‘i members will receive 10% off one booking per quarter and a free checked bag. Huaka‘i members who are Hawaiian Airlines World Elite Mastercard holders will receive 20% off one interisland booking per quarter and their existing credit card benefit of two free checked bags. Plus, members will receive access to exclusive, network-wide deals each month. Soon, Hawaii residents will receive an email with a link to sign up for a free membership.
Sprague said that 80% of Hawaiian’s workforce of some 7,400 employees in Hawaii are union members, and those employees “will all be retained.” He added “the vast majority” of the 1,400 or so management employees not covered under the collective bargaining agreements “will be offered a position of some sort in the combined airline.”
“There are roles that, in some cases, are duplicative of existing roles at Alaska Airlines,” Sprague said. “… Over the next couple of weeks, we will be sharing with those employees what their status will be in the go-forward airline.”
According to Sprague, employees whose positions are eliminated will be kept on for the next 90 days and will receive a monetary retention award and “a generous severance package on top of the retention award.”
“We are going to provide tailored career planning and placement services provided by a local firm here in Honolulu to each of those individuals,” he said. “We want to take very good care of all the Hawaiian Airlines employees, including those whose positions will not be retained.”
Email John Burnett at jburnett@hawaiitribune-herald.com.
