Once a proudly independent airline, we’re now on a countdown until Alaska Airlines officially joins the oneworld family. But what changed at Alaska to make it want to buddy up on a global scale, and why was oneworld the alliance of choice?
Critical mass reached
Alaska Airlines’ CEO Brad Tilden spoke at Routes Reconnected this week about his reasons for joining oneworld. As much as he took pride in Alaska’s longstanding independence, he realized that his airline had gone about as far as it could go without moving forward in this way. He explained,
“The right answer for us, 10 years ago was to not be in a global alliance and to have all of these bilateral relationships with individual airlines. As the US industry consolidated, and as these global alliances became more important, it became really clear to us that the best answer for us was to get into a global alliance.”
Pivotal to the decision was the acquisition of Virgin America four years ago. The injection of its network, people, and planes meant Alaska reached what Tilden called ‘critical mass’ on the West Coast, with incredibly strong networks out of SEA, LAX, and SFO. Still, he believed there was an opportunity to do more, and connecting into a global network was key to the airline’s growth.
“With oneworld, the company has long-standing fantastic relationship with British and with JAL and with Qantas, and of course with American. So, it was the alliance that was the most natural for us to enter.”
Support from American Airlines
When Alaska Airlines made the decision to apply to join oneworld, it needed support from the incumbent alliance member and founder airline American. Tilden explained that, for the big US airline, the partnership was an excellent fit, with benefits to be had in both directions. He said,
“Entering that alliance required us to have American support. As their domestic airline in the United States, they would have to support us. As they started looking at their route network, they saw Alaska could play a unique role for American Airlines customers with our strength up and down the West Coast.”
Alaska secured the support of American Airlines, and in February this year, announced a West Coast alliance with American, which saw the existing codeshare expanded. As well as the enhanced codeshare in lieu of full alliance membership being granted, American began flying out of Seattle to new destinations at London Heathrow and Bangalore.
For American, Alaska joining oneworld not only expands its domestic network immensely, but it also strengthens its position on the West Coast, giving it a leg up on ever-expanding Delta Air Lines.
What will the alliance do for Alaska?
Tilden noted that, out of Seattle, Alaska Airlines is incredibly strong. The airline operates to around 100 cities domestically out of Seattle, but has been lacking the ability to offer an international connection. With airlines like British Airways, Cathay, JAL, and American flying all over the world out of Seattle, Tilden sees a multitude of opportunities for the airline to take a slice of the action.
In particular, he has his eye on the business segment of travelers. In particular, he noted the regular services by oneworld partners to destinations like London, Bangalore, and Shanghai, and how powerful that would be in combination with Alaska’s comprehensive West Coast network. He said,
“It’s going to be an incredible offering. We can go into the biggest corporate accounts in Seattle… Microsoft, or Amazon, or Starbucks, or Costco, and it’s an extremely competitive, very powerful offer.”
But of course, Alaska is not confined to Seattle and has its sights set on expansion and opportunity elsewhere too. Tilden can envisage the deeper cooperation with American working in its favor to secure more action out of big markets like Los Angeles too. He commented,
“In an alliance like this, we are competitors and partners. I think there will be an evolution of what it is American wants, what markets out of Los Angeles do they want to be strong in and where do they want to use their partners. Based on the way I see things happening in LA, that there’ll be opportunities for Alaska Air Group in a market like that as well.”
It seems Brad can’t wait to see how Alaska Airlines grows and thrives as part of the oneworld alliance, but sadly he won’t be around to see it evolve. Tilden is set to retire as Alaska Airline’s CEO at the end of March next year, the very same date that the airline will officially become part of the oneworld family. Nevertheless, he plans to stay on as Chairman, so will get to watch his airline thrive under the leadership of Ben Minicucci.