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Alaska Airlines Acquisition of Hawaiian Airlines Reshapes the Air Travel Landscape

Alaska Airlines' Acquisition of Hawaiian Airlines Reshapes the Air Travel Landscape

Alaska Air Group, Inc. (NYSE: ALK) and Hawaiian Holdings, Inc. (NASDAQ: HA) jointly announced today the execution of a definitive agreement, signifying Alaska Airlines’ acquisition of Hawaiian Airlines at a cash price of $18.00 per share. The total transaction value stands at approximately $1.9 billion, encompassing Hawaiian Airlines’ net debt of $0.9 billion.

The combination of complementary domestic, international, and cargo networks

This strategic union is poised to open up an array of additional destinations, providing consumers with increased choices in crucial air service options across the Pacific region, Continental United States, and globally.

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The transaction is anticipated to establish a robust platform for growth and competition in the U.S., offering enduring employment opportunities, ongoing community investments, and a commitment to environmental stewardship.

Key Points:

  1. Acquisition Overview:
    • Alaska Air Group to acquire Hawaiian Holdings for $18.00 per share in an all-cash transaction, totaling approximately $1.9 billion.
    • Combined company aims to maintain the strong, high-quality brands of Alaska Airlines and Hawaiian Airlines.
  2. Fleet Expansion and Network Reach:
    • Creates the fifth-largest U.S. airline with a fleet of 365 narrow and wide-body airplanes.
    • Enables access to 138 destinations through combined networks and over 1,200 destinations via the oneworld Alliance.
  3. Hub Development and Connectivity:
    • Honolulu to become a key hub for the combined airline, offering expanded services to the Continental U.S., Asia, and the Pacific.
    • Tripling the number of destinations from Hawai‘i to North America, while maintaining robust Neighbor Island service.
  4. Commitment to Hawai‘i:
    • Strong commitment to Hawai‘i, ensuring robust Neighbor Island air service.
    • Aiming for a more competitive platform supporting growth, job opportunities, community investment, and environmental stewardship.
  5. Employee and Union Commitment:
    • Commitment to maintaining and growing the union-represented workforce in Hawai‘i.
    • Immediate value creation with at least $235 million of expected run-rate synergies.
  6. Investor Call and Timeline:
    • Investor conference call scheduled for today at 5:00 p.m. ET / 2:00 p.m. PT / 12:00 p.m. HT.
    • Anticipated closing of the transaction within 12-18 months.
  7. Strategic and Financial Rationale:
    • Complementary networks to enhance competition and provide greater choice for consumers.
    • Preservation of both Alaska and Hawaiian Airlines’ brands on a single operating platform.
    • Expected to deliver high single-digit earnings accretion for Alaska Airlines within the first two years.
  8. Community and Sustainability Commitment:
    • Focus on growth in union-represented jobs and strong operational presence in Hawai‘i.
    • Commitment to environmental stewardship, aligning with Alaska Airlines’ five-part path to net zero by 2040.
  9. Synergies and Accretion:
    • Expected run-rate synergies of at least $235 million.
    • Transaction multiple of 0.7 times revenue, approximately one third the average of recent airline transactions.
  10. Conditions to Close:
  • Approval by regulatory authorities and Hawaiian Holdings, Inc. shareholders.
  • Expected to close in 12-18 months, with the combined organization based in Seattle under the leadership of Alaska Airlines CEO Ben Minicucci.

He is an aviation journalist and the founder of Jetline Marvel. Dawal gained a comprehensive understanding of the commercial aviation industry.  He has worked in a range of roles for more than 9 years in the aviation and aerospace industry. He has written more than 1700 articles in the aerospace industry. When he was 19 years old, he received a national award for his general innovations and holds the patent. He completed two postgraduate degrees simultaneously, one in Aerospace and the other in Management. Additionally, he authored nearly six textbooks on aviation and aerospace tailored for students in various educational institutions. jetlinem4(at)gmail.com

Airlines

IndiGo, India’s Leading Airline, Orders 30 Airbus A350-900 Aircraft

IndiGo, India's Leading Airline, Orders 30 Airbus A350-900 Aircraft

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Today, IndiGo, India’s leading low-cost carrier, made headlines by placing its largest-ever order for A350 aircraft. This substantial move follows Air India’s order last year, signaling IndiGo’s strategic expansion into the wide-body aircraft market.

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The Airbus A350, renowned for its advanced technology and spacious design, has become a prime choice among airlines worldwide. IndiGo’s decision to invest in the A350 stems from its growing international route network, where larger capacity and extended range are essential.

Following the announcement, IndiGo’s stock prices surged, reflecting investor confidence in the airline’s ambitious growth plans. The initial order encompasses 30 jets, with options for an additional 70 aircraft in the future. While specific configurations are pending, IndiGo is inclined towards the A350-900 variant, favored by many airlines for its versatility.

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Indian aviation enthusiasts have eagerly welcomed IndiGo’s bold move, anticipating the arrival of the A350-900 aircraft starting in 2027. Furthermore, the airline retains purchase rights for an impressive 70 more A350 family aircraft, signaling its long-term commitment to enhancing its fleet and expanding its global footprint.

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US DOT says Airlines must now pay automatic refunds for cancelled flights

US DOT says Airlines must now pay automatic refunds for cancelled flights

The U.S. Department of Transportation (DOT) has released a final regulation requiring airlines to quickly reimburse passengers with automatic cash refunds when owed, according to a statement made by the Biden-Harris Administration.

Under the new regulation, passengers will find it easier to get refunds when airlines dramatically alter or cancel flights, cause severe delays for checked baggage, or don’t supply the additional services they paid for.

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According to a statement from the Biden-Harris Administration, the U.S. Department of Transportation (DOT) has published a final rule mandating airlines to promptly compensate customers with automatic cash refunds when they are eligible. The new rule would make it simpler for customers to receive refunds from airlines in cases when they drastically change or cancel flights, cause significant delays for checked luggage, or fail to provide the extra services they charged for.

Under the latest rule from the USDOT, passengers are guaranteed refunds in several scenarios:

  1. Canceled or Significantly Changed Flights: Passengers are entitled to refunds if their flight is canceled or significantly altered, including changes in departure or arrival times exceeding 3 hours domestically or 6 hours internationally, departures or arrivals from different airports, increased connections, downgrades in service class, or changes less accommodating to passengers with disabilities.
  2. Delayed Baggage Return: Passengers filing mishandled baggage reports can claim a refund for checked bag fees if their luggage is not returned within specific timeframes after flight arrival.
  3. Unprovided Extra Services: If airlines fail to deliver paid extra services like Wi-Fi, seat selection, or inflight entertainment, passengers can request refunds for those fees.

The final rule streamlines the refund process, ensuring it is:

  • Automatic: Refunds are issued automatically without requiring passengers to request them.
  • Prompt: Airlines must refund credit card purchases within seven business days and other payment methods within 20 calendar days.
  • In Original Form of Payment: Refunds are provided in the original payment method used for purchase.
  • Full Amount: Passengers receive full refunds minus the value of any portion of transportation already used, including government and airline fees.

Suggest banning family seating junk fees and ensuring that parents can travel with their kids at no additional cost. No airline promised to ensure fee-free family seating prior to efforts from President Biden and Secretary Buttigieg last year. Family seating is now guaranteed free of charge on four airlines, and the Department is working on a plan to eliminate family seating junk fees.

Propose to make passenger compensation and amenities mandatory so that travelers are taken care of when airlines cause flight delays or cancellations. 

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Airlines

The Nine Freedoms of the Air – Jetline Marvel

The Nine Freedoms of the Air - Jetline Marvel

Most of us travel from one city to another city via road we need to get permission to that specific city if it is in another country like a visa or Road access permission to use its property for revenue purposes to carry passengers and Cargo. Similarly, In the airline Industry, it is also important that the Company have permission to fly and access that country whether it’s for stoppage flying above them, or Operating the passengers within that country This is called Freedom of the Air.

Some countries together they agree with certain conditions to access their Aerospace for to access for the airline to travel above their nation. If the bilateral is done for Their own countries’ airlines or other countries’ airlines. In this chapter, we understand how this thing is carried out. What all the condition has to look into that.  

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The Freedoms of the Air are international commercial aviation agreements (traffic rights) that grant a country’s airline(s) the privilege to enter and land in another country’s airspace. They were formulated in 1944 at an international gathering held in Chicago (known as the Chicago Convention) to establish uniformity in world air commerce. There are generally considered to be nine freedoms of the air.

Most nations of the world exchange first and second freedoms through the International Air Services Transit Agreement. The other freedoms,chase freedom airline miles when available, are usually established between countries in bilateral or multilateral air services agreements. The third and fourth freedoms are always granted together. The eighth and ninth freedoms (cabotage) have been exchanged only in limited instances

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First Freedom:

The basic permission granted to an airline from one country (A) to fly through the airspace of another country (B)

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The Nine Freedoms of the Air - Jetline Marvel

Second Freedom:

The permission for a commercial airplane from country (A) to land and refuel (often called a technical stop) in another country (B).

The Nine Freedoms of the Air - Jetline Marvel

Third Freedom :

The privilege for an airline to transport paying (Revenue) passengers from its home country (A) to another country (B).

The Nine Freedoms of the Air - Jetline Marvel

Fourth Freedom

The rights for an airline to transport paying (Revenue )passengers from another country (B) to the airline’s home country (A).

The Nine Freedoms of the Air - Jetline Marvel

Fifth Freedom

Fifth Freedom (also known as beyond rights): The rights for an airline to transport passengers from its home country (A) to a destination (B), then pick up and carry passengers to other international destinations (C).

The Nine Freedoms of the Air - Jetline Marvel

Sixth Freedom:

Sixth Freedom (Combination of Third & Fourth Freedoms) The right for an airline to carry passengers or cargo between two foreign countries (B and C), provided the aircraft touches down in the airline’s home country (A).

The Nine Freedoms of the Air - Jetline Marvel

Seventh Freedom:

The authorization for an airline to operate flights that start in a foreign country (B), skip its home country (A), and transport passengers to another international destination (C).

The Nine Freedoms of the Air - Jetline Marvel

Eighth Freedom Air

The rights for an airline to transport passengers from one location within a country’s territory (B) to another point within the same country on a flight originating in the airline’s home country (A). This right is commonly referred to as cabotage and is notably scarce outside of Europe.

The Nine Freedoms of the Air - Jetline Marvel

Ninth Freedom Air

The entitlement for an airline from a specific country (A) to begin a flight in a foreign country (B) and transport passengers from one location to another within that foreign country. This concept, also referred to as stand-alone cabotage, distinguishes itself from the traditional aviation definition of cabotage by not directly involving the airline’s home country.

The Nine Freedoms of the Air - Jetline Marvel
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