Transportation Industry

Company Watch - Alaska Airlines

AirGuide Business, Oct 13, 2008

Oct 13, 2008

Alaska Airlines today voiced concerns that the Boeing strike could greatly affect its fleet and capacity plans. The all-Boeing 737 operator's capacity agenda is dependent "on what happens in the Boeing strike", said Alaska VP finance and controller Brandon Pederson during the Boyd aviation forecast conference in Aspen. According to Flight's ACAS database, Alaska holds firm orders for a further 21 737-800s. A total 10 of these are slated to be delivered by April, says Pederson, warning that "not having those airplanes would have a significant impact on our business". The Seattle-based carrier shed the last of its Boeing MD-80s on 25 August. The decision to rid the fleet of MD-80s made sense to Alaska in 2006 at $40/barrel oil but it "certainly makes sense at $100/barrel oil", says Pederson. Oct 6, 2008

Alaska Airlines on Tuesday joined United Airlines in warning that fuel hedges could lead to quarterly losses. "As a result of the significant decline in crude oil prices since the end of the second quarter, we expect to record approximately $220 million in mark-to-market loss on the value of our fuel hedge portfolio," the company said in an SEC filing. Industry watchers say other airlines could report similar losses from hedging activities, though Southwest Airlines already has said it expects any impact to be minimal. Oct 7, 2008

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