Tag Archives: Virgin America

Alaska Airlines, Virgin America and its flight attendants reach tentative merger agreement

Alaska Airlines Airbus A320-214 N625VA (msn 2800) FLL (Bruce Drum). Image: 104579.

Alaska Airlines, Virgin America and the Association of Flight Attendants announced on February 14, 2018 announced they have reached a tentative merger agreement for the airline’s 5,400 flight attendants.

The merger agreement includes competitive pay raises, increase in retirement contributions and quality of life benefits and preserves all productivity of Alaska Airlines existing contract.

Alaska Airlines’ flight attendants will conduct a ratification vote that is expected to be completed in April. The tentative merger agreement marks a major milestone in integrating Virgin America and Alaska Airlines flight attendants.

Virgin America flight attendants joined AFA in April 2017, shortly after the merger. Next steps for this work group include combining seniority lists, cross training on Boeing and Airbus, as well as integration of crew scheduling systems, which will be completed in 2019.

The existing five-year contract, which was approved by members in 2014, becomes amendable in December 2019. Alaska Airlines and AFA will begin negotiations for its first joint labor agreement later this year.

Under the Railway Labor Act, which governs collective bargaining agreements in the airline industry, contracts do not expire. Instead they become amendable.

Copyright Photo: Alaska Airlines Airbus A320-214 N625VA (msn 2800) FLL (Bruce Drum). Image: 104579.

Alaska Airlines aircraft slide show (Airbus, current livery):

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Alaska Air Group reports fourth quarter and 2017 results

Alaska Airlines Airbus A320-214 N625VA (msn 2800) VCV (Derin Allard). Image: 940790.

Alaska Airlines Group issued this financial report for the 4Q and 2017:

Dividend Increase:

  • Announced today a 7% increase in the quarterly dividend from $0.30 per share to $0.32 per share. The dividend will be paid on March 8, to all shareholders of record as of Feb. 20, 2018. This is the fifth time the company has raised the dividend since initiating the quarterly dividend in July 2013, with a cumulative increase of 220% since that time.

Financial Highlights:

  • Reported net income for the fourth quarter and full-year under Generally Accepted Accounting Principles (“GAAP”) of $367 million, or $2.97 per diluted share, and $1.0 billion, or $8.30 per diluted share. These results compare to fourth quarter 2016 net income of $114 million, or $0.92per diluted share, and full-year 2016 net income of $814 million, or $6.54 per diluted share. As the acquisition of Virgin America Inc. (Virgin America) closed on Dec. 14, 2016, 2017 information reflects the results of Virgin America. 2016 information reflects the results of Virgin America from Dec. 14-31, 2016.
  • Reported fourth quarter 2017 adjusted diluted earnings per share of $0.83 compared to $1.56reported in the fourth quarter of 2016. Fourth quarter adjusted net income, excluding merger-related costs, special income tax benefits related to tax law changes, and mark-to-market fuel hedging adjustments, was $103 million compared to $193 million in the fourth quarter of 2016. This quarter’s adjusted results compare to the First Call analyst consensus estimate of $0.82 per share.
  • Reported full year 2017 adjusted net income, excluding merger-related costs, the special income tax benefit, and mark-to-market fuel hedging adjustments, of $823 million, compared to $911 million in 2016. Reported 2017 adjusted diluted earnings per share of $6.64, compared to $7.32in 2016.
  • Paid a $0.30 per-share quarterly cash dividend in the fourth quarter, bringing total dividend payments in 2017 to $148 million.
  • Repurchased a total of 981,277 shares of common stock for approximately $75 million in 2017.
  • Generated approximately $1.6 billion of operating cash flow and used approximately $1.0 billionfor capital expenditures, resulting in approximately $547 million of free cash flow in 2017.
  • Grew passenger revenues by 32% compared to the fourth quarter of 2016, and by 36% compared to full-year 2016, largely enabled by our acquisition of Virgin America in December of 2016.
  • Generated full-year adjusted pretax margin of 17% in 2017.
  • Held $1.6 billion in unrestricted cash and marketable securities as of Dec. 31, 2017.
  • Reduced debt-to-capitalization ratio to 51% as of Dec. 31, 2017, compared to 59% as of Dec. 31, 2016.

2017 Accomplishments and Highlights:

Recognition and Awards – Alaska

  • Ranked “Highest in Customer Satisfaction Among Traditional Carriers” in 2017 by J.D. Power for the tenth year in a row.
  • Ranked first in the U.S. News & World Report’s list of Best Travel Rewards Programs for the third consecutive year.
  • Won the “Best Rewards Program” for Alaska Mileage Plan for carriers in the “Americas” region in the sixth annual FlyerTalk Award.
  • Mileage Plan ranked Best Airline Elite Status Program in the U.S. by The Points Guy.
  • Ranked among Forbes’ 2017 “America’s Best Employers” for the third year in a row.
  • Received 16th Diamond Award of Excellence from the Federal Aviation Administration, recognizing both Alaska and Horizon’s aircraft technicians for their commitment to training.
  • Ranked by AirlineRatings.com as one of only two U.S. airlines in the Top 20 safest airlines in the world.
  • Rated “Best Airline Staff in North America” and “Best Regional Airline in North America” by Skytrax World Airline Awards.
  • Awarded TripAdvisor’s 2017 Travelers’ Choice Award for second-best midsize and low-cost airlines in North America and one of the top 10 best airlines in the world.
  • Recognized by the Puget Sound Business Journal as the 2017 Board Diversity Champion, as well as by the Women Corporate Directors Global Institute for diversity among our Directors.
  • Ranked as the top U.S. airline in the Dow Jones Sustainability Index (DJSI), receiving perfect scores for “efficiency” and “reliability.”
  • Recognized as No. 1 in fuel efficiency for U.S. airlines by the International Council on Clean Transportation for the 7th consecutive year.
  • Named one of the overall five-star major regional airlines at the Passenger Choice Awards during the APEX EXPO.
  • Ranked fifth of most engaged companies in the U.S. by Forbes Insights, which measured social media engagement, net promoter scores, and year-over-year sales growth.

Recognition and Awards – Virgin America

  • Rated Best U.S. Airline by Conde Nast Traveler in their “Annual Readers’ Choice Awards” for the tenth year in a row.
  • Rated Best Domestic Airline in Travel + Leisure “World’s Best Awards” for the tenth year in a row.
  • Received a five-star rating for low-cost carrier, and received a top honor with a Passenger Choice Award for “Best Seat Comfort” during the APEX EXPO.

Our People

  • Awarded $135 million in incentive pay to employees for 2017.
  • Awarded employees a $1,000 bonus in January 2018 in connection with the passing of the Tax Cuts and Jobs Act, amounting to approximately $25 million to be paid on Jan. 29, 2018.
  • Granted “Single Carrier Determination” by the National Mediation Board (“NMB”) for Alaska Airlines and Virgin America, paving the way for labor integration and union representation. The NMB officially certified the Association of Flight Attendants as the union representative for Virgin America inflight teammates and the International Association of Machinists and Aerospace Workers as the union representative for Virgin America clerical, office and passenger service employees.
  • Entered into an agreement with the International Brotherhood of Teamsters to amend the eight-year contract with Horizon’s pilots, providing Horizon the ability to attract and retain the best pilots in the regional industry.
  • Alaska received a perfect score of 100% for workplace equality on the 2018 Corporate Equality Index (“CEI”). Virgin America received a score of 95%.

Our Guests and Product

  • Launched various new in-flight amenities, including Free Chat, upgraded food and beverage options and Premium Class service.
  • Selected Gogo to provide next-generation satellite-based Wi-Fi across the entire Boeing and Airbus fleets, providing guests a faster and more-reliable internet connection.
  • Dropped fees for bikes, golf clubs, skis, surfboards, and other sporting equipment that exceed Alaska’s normal checked baggage weight and dimensions to $25.
  • Added Condor Airlines, Finnair, and Singapore Airlines as global Mileage Plan partners.
  • Announced plans to fly 13 daily departures from Paine Field-Snohomish County Airport in Everett, Washington to eight West Coast markets starting in fall 2018.
  • Announced a seven-year partnership to be the official airline of the San Francisco Giants which includes, among other things, exclusive naming rights to the AT&T Park Club Level which will now be called the “Alaska Airlines Club Level.”

  • Signed an exclusive multi-year partnership with Golden State Warriors star Kevin Durant naming him “Advisor to the CEO,” and extended our partnership with Russell Wilson and Ciara.
  • Converted the world’s first Boeing 737-700 from a passenger plane to a freighter and placed it into revenue service.
  • Added 14 Boeing 737-900ER aircraft and 4 Airbus A321neo aircraft to the operating fleet in 2017, bringing the total Mainline fleet to 221 aircraft.
  • Added 10 Embraer 175 (E175) regional jets to Horizon Air’s fleet in 2017.
  • Added 44 new markets in 2017 across the Alaska Air Group and Virgin America networks.

Our Communities

  • Donated over $14 million and contributed more than 32,000 volunteer hours to support nonprofits in our local communities, focusing on youth and education, medical (research/transportation) and community outreach.

Alaska Air Group Inc. reported fourth quarter 2017 GAAP net income of $367 million, or $2.97 per diluted share, compared to $114 million, or $0.92 per diluted share in 2016. Excluding the impact of merger-related costs, the special income tax benefit, and mark-to-market fuel hedge adjustments, the company reported fourth quarter adjusted net income of $103 million, or $0.83 per diluted share, compared to adjusted net income of $193 million, or $1.56 per diluted share in the fourth quarter of 2016.

The company reported full-year 2017 GAAP net income of $1,028 million, compared to $814 million in the prior year. Excluding the impact of merger-related costs, the special income tax benefit, and mark-to-market fuel hedge adjustments, the company reported adjusted net income of $823 million, or $6.64 per diluted share for 2017, compared to adjusted net income of $911 million, or $7.32 per diluted share in 2016.

“2017 was a great year – we invested in our route network, our fleet, our product, and laid the foundation for our future,” said Brad Tilden, Alaska’s CEO. “We added 44 new routes to our network (in addition to the 38 added through Virgin America), grew membership in our loyalty program, and made great progress on our integration of Virgin America. By early spring, we’ll have the bulk of the integration behind us, and working with our people to do more of what Alaska does best – running a highly reliable operation and offering our guests outstanding customer service.”

Copyright Photo: The first ex-Virgin America Airbus A320 has been repainted at Victorville. After this photo was taken, it was flown to San Francisco to enter revenue service from SFO. Alaska Airlines Airbus A320-214 N625VA (msn 2800) VCV (Derin Allard). Image: 940790.

 

Alaska Airlines aircraft slide show (current livery):

With the single AOC, Virgin America is no longer an airline and now just a disappearing brand

 

Alaska Airlines (Seattle/Tacoma) yesterday (January 11, 2018) announced the Federal Aviation Administration (FAA) had now awarded to both Alaska Airlines and Virgin America a single Air Operators Certificate – AOC as Alaska Airlines. It is a significant milestone in the merger process.

Technically, this means Virgin America, yesterday went from an airline to just a brand. Today all operations of Alaska and Virgin America are under the Alaska AOC in the eyes of the FAA.

Virgin America was the creation of Sir Richard Branson (above) and his U.S. partners who wanted to reinvent airline service in the United States.

Alaska will now begin to repaint the Virgin America fleet and the Virgin America brand will disappear. Gates will now be consolidated and resigned. Personnel will be consolidated. Operations will consolidated.

We will soon have a “Proudly All Boeing” Alaska Airlines painted Airbus aircraft.

For now, there are still two reservations systems but this is expected to change by April.

 

We are now witnessing the slow death of an airline brand that was very innovative. There is a sizeable amount of loyal customers shedding a tear or two today, especially on the U.S. West Coast.

Does this leave the door open for another innovative airline to come along? It is still unclear how many Virgin America ammenties and practices Alaska will keep. Alaska Airlines has stated it wants to keep the best parts of both airlines and to create an even better airline. It will be tough to duplicate the spirit of Virgin America.

For now, lets look back on this innovative and highly-regarded airline that is now fading away.

All photos by Virgin America.

Virgin America aircraft slide show:

Videos:

Alaska and Virgin America reach a merger milestone; a single AOC

Alaska Airlines made this announcement on its blog:

January 11, 2018 is a big day for Alaska Airlines. The company received a single operating certificate from the Federal Aviation Administration, which means the FAA now recognizes Alaska and Virgin America as one airline. It marks a major milestone in the integration of the two airlines.

Through that work, Alaska kept growing by adding 44 routes across its network, in addition to the 38 routes that were added with the acquisition of Virgin America.

Alaska now has the most West Coast nonstop destinations of any airline, and now offers nonstop service to 42 destinations from the Bay Area alone. And with 15 airline partners, Alaska can take its guests to more than 900 destinations around the world.

Combined Route Map:

What does it mean for me?

app After todays big merger milestone, Alaska and Virgin America prepare for more exciting changes in 2018Obtaining a single operating certificate will not result in any immediate differences for guests when flying with Alaska or Virgin America. For now, customers will still use respective Alaska and Virgin America mobile apps, websites and airport terminals when traveling. But when Alaska and Virgin America move to a single reservations system in late April 2018, guests can expect a more streamlined travel experience, with the Alaska mobile app and website serving their travel needs.

When it comes to combining two companies, it’s a huge lift and takes a lot of effort. In working to obtain a single operating certificate, a dedicated team of employees from both carriers invested more than 70,000 hours to streamline and merge operating procedures, manuals and training programs.

Changes that benefit our guests

18954682 10155382289837486 1774959059388009421 o After todays big merger milestone, Alaska and Virgin America prepare for more exciting changes in 2018

Alaska Airlines offers West Coast-inspired beer and wine choices. Over the summer, Alaska poured a rosé made with grapes from Washington’s Columbia Valley.

During integration, there have been a lot of accomplishments – large and small – to benefit guests:

  • More than 200 free movies and TV shows can be streamed directly to personal devices plus free texting on Alaska and now Virgin America flights.
  • At some airports, both airlines have co-located operations, with more to come.
  • Flyers at both airlines now enjoy a single loyalty program (Mileage Plan) and credit card.

The new year means continuing integration progress. Here’s a look at some of what’s ahead:

  • High-speed, satellite Wi-Fi is on the horizon for Alaska’s entire fleet of Boeing and Airbus aircraft beginning this spring.
  • Upgrades to on-board menus, with more options in First Class; West Coast-inspired beer and wine choices; and new, fresh meal selections in the Main Cabin to join the popular fruit and cheese plate.
  • Blue mood lighting will appear on more and more aircraft.
  • Flight and ground crews begin wear-testing new uniforms designed by Seattle’s own Luly Yang, with a roll-out across the company in 2019.
  • In January, the first Airbus plane gets painted with Alaska’s colors.
  • Updated and expanded airport lounges are in the works, with New York’s JFK lounge opening in April, and the new 15,000 square-foot flagship lounge at Seattle opening next year.

Every day, Alaska Airlines is focused on creating an airline people love, with great service and value, low airfares and a generous loyalty program. With caring employees and a constant commitment to safety, Alaska is eager to be the airline of choice on the West Coast, and ready for a 2018 filled with new accomplishments.

Alaska closed its purchase of Virgin America in December 2016. Since then, a tremendous amount of work and planning has been done to align the operating policies and procedures of the two carriers, which is part of the thorough regulatory requirements established by the FAA to achieve a single operating certificate.

More than 110 employees from both airlines worked to obtain the single operating certificate. They logged approximately 70,000 hours; reviewed 346 different operational topics across 136 manuals; analyzed more than 39,000 pages of material; and instituted roughly 1,500 changes to policies and procedures throughout 68 various manuals. More than 10,500 frontline employees have been trained on the updated policies and procedures. As part of the single operating certificate approval process, Virgin America flight attendants were issued iPhones for their work duties, matching their Alaska counterparts; Virgin America pilots are now going through a validation period to receive iPads, similar to Alaska’s pilots.

There has been a steady flow of accomplishments on integration. Among them, as of Jan. 1, the Virgin America loyalty program integrated with Alaska Mileage Plan, and the company transitioned to a single payroll and benefits program. The single operating certificate allows Alaska to continue integration work that can only be achieved with the certification. An additional milestone will be reached in March when an Airbus operations control center will be co-located with one for Boeing aircraft at Alaska’s Flight Operations Center in Seattle.

All photos by Alaska Airlines.

Alaska and Virgin America unveil their Airbus A321 “Most West Coast” logo jet

Virgin America's 2017 "Most West Coast" special livery

Alaska Airlines and Virgin America have unveiled their new Airbus A321neo recently delivered to Virgin America. The new airliner wears this special “Most West Coast” livery to celebrate the fact that both carriers cover the U.S. West Coast more than any other carrier.

N925VA was delivered on December 2, 2017 and has just adopted this special livery. N925VA has very small “Operated by Virgin America” titles near the nose, pending future painting with Alaska Airlines titles.

Alaska Air Group serves 118 destinations with nearly 1,200 daily flights in the United States, Mexico, Canada, Costa Rica and Cuba. This includes markets flown by Virgin America as well as Horizon Air, SkyWest Airlines and PenAir, which provide feed traffic to Alaska Airlines under capacity purchase agreements.

With West Coast hubs in Seattle/Tacoma; Portland, Oregon; Anchorage, Alaska; San Francisco and Los Angeles; Alaska calls Seattle home. Alaska Air Group offers more flights to more destinations from the Pacific Northwest than any other airline.

The Virgin America brand will be retired in 2019. The current Virgin America Airbus A319 and A320 fleet is expected to be repainted starting in early 2018.

Copyright Photo: Virgin America Airbus A321-253N WL N925VA (msn 7999) (Most West Coast) SFO (Mark Durbin). Image: 940365.

Virgin America:

Route Map:

Alaska Airlines launches new service from San Francisco to Kona

"Chace Plane"

Alaska Airlines on December 14, 2017 begins nonstop service between San Francisco International Airport and Kailua-Kona International Airport, the 31st new route launched by the carrier from Californiathis year. The new service is part of the largest network expansion in Alaska Airlines’ 85-year history and solidifies Alaska Air Group as the leading airline of nonstop flights from the West Coast to Hawaii.

Virgin America’s A320 family of aircraft will operate the new route, with three classes of service, power outlets throughout the cabin, custom leather seats with adjustable headrests and a selection of food and beverage inspired by local chefs.

Summary of new service:

Start date City pair Departs Arrives Aircraft Frequency
Dec 14 San Francisco-Kona 11:30 a.m. 3:15 p.m. A320 family Daily
Dec 14 Kona-San Francisco 4:15 p.m. 11:17 p.m. A320 family Daily
*Flight times based on local time zones.

Alaska Airlines, together with Virgin America and its regional partners, flies 40 million guests a year to more than 115 destinations with an average of 1,200 daily flights across the United States and to Mexico, Canada and Costa Rica.

Copyright Photo: Virgin America Airbus A320-214 WL N283VA (msn 6787) JFK (Fred Freketic). Image: 935544.

Alaska Air Group reports Third Quarter 2017 results

"Chace Plane"

Alaska Air Group, Inc., on October 25, 2017 reported third quarter 2017 GAAP net income of $266 million, or $2.14 per diluted share, compared to $256 million, or $2.07 per diluted share in the third quarter of 2016. Excluding the impact of merger-related costs and mark-to-market fuel hedge adjustments, the company reported adjusted net income of $278 million, or $2.24 per diluted share, compared to $272 million, or $2.20 per diluted share, in 2016.

“Our people delivered very strong results again this quarter,” said CEO Brad Tilden. “At roughly the halfway point in our integration with Virgin America, and despite some unrelated challenges in our regional operation, our business is performing well, and we are very happy with the response we’ve seen in California and throughout the West to our expanding network, our focus on hospitality, and to our industry-leading mileage plan. I want to thank our talented people for their commitment and dedication.”

Copyright Photo: Virgin America aircraft will shortly be taking on the Alaska brand. Virgin America Airbus A320-214 WL N283VA (msn 6787) JFK (Fred Freketic). Image: 935544.

Virgin America: