Hawaiian Airlines to merge with Alaska Airlines

Hawaiian Airlines will become part of Alaska Airlines in a US$1.9bn deal which could also see Hawaiian become part of the Oneworld alliance.

Under the acquisition plan, which is expected to be fully in place by mid-2025, Alaska Airlines and Hawaiian Airlines will continue operating as seperate brands with their respective hubs at Seattle and Honolulu, albeit “on a single operating platform” from a business perspective

“Honolulu will become a key Alaska Airlines hub, enabling greater international connectivity for West Coast travellers throughout the Asia-Pacific region with one-stop service through Hawai’i,” the airlines said in a joint statement.

“The combination preserves and expands high-quality, best-in-class product offerings with price points to make air travel accessible to a wide range of consumers across a range of cabin classes, including greater choice between Alaska Airlines' high-value, low-fare options and Hawaiian Airlines' international and long-haul product on par with network carriers.”

Hawaiian Airlines has been struggling since the Covid-19 pandemic and expects to post another annual loss for 2023; Alaska Airlines says its purchase includes covering US$900m of Hawaiian Airlines debt.

The boards of both airlines have approved the deal, and Hawaiian Airlines shareholders are expected to wave it through thanks to a hefty premium being offered on shares, although the merger must also be permitted by US regulators.

Alaska Airlines maintains a mostly domestic or North American network with a fleet of single-aisle jets, while Hawaiian Airlines connects the US mainland to Asia and the South Pacific, and has twelve Boeing 787 Dreamliners due for delivery from early 2024.

The ‘complementary networks’ of both airlines carry almost 55 million passengers each year, with less than 3% of their routes overlapping.

Alaska Airlines sees the Hawaiian Airlines network as complementary to its own.

Will Hawaiian Airlines join Oneworld?

Both carriers “will be supported by a single, compelling loyalty offering” – in other words, Alaska’s own Mileage Plan frequent flyer scheme will replace the HawaiianMiles platform and swell Alaska’s books to an estimated 11.2 million members.

Hawaiian Airlines says the status and miles held by HawaiianMiles members will be transferred to Mileage Plan, including matching its Pualani Elite Gold and Platinum members to Alaska’s equivalent MVP Gold tiers.

This will deliver “the ability to earn and redeem miles on 29 global partners and receive elite benefits on the full complement of Oneworld Alliance airlines, expanded global lounge access and benefits of the combined program’s co-brand credit card.”

It could also provide a pathway for Hawaiian Airlines to become a member of Oneworld, either in a de facto arrangement as an arm of Alaska Airlines or a fully-fledged member.

This could play out in three ways:

• Under Alaska's aegis and sponsorship, Hawaiian Airlines could apply to become a full member of Oneworld, or
• Hawaiian Airlines could become a Oneworld Connect member, along the same lines as Fiji Airways – this model delivers a core set of benefits on a handful of supporting airlines, but not across all Oneworld members, or
• Hawaiian Airlines would remain outside Oneworld but its passengers would enjoy some status perks on Alaska Airlines, while also using their Alaska Mileage Plan membership to earn and burn when flying on Oneworld airlines – essentially mirroring the relationship of Qantas and its low-cost sibling Jetstar.

Alaska Airlines is Oneworld’s newest member, having joined in March 2021, with Oman Air set to follow next year.

The buyout could also see Virgin Australia lose Hawaiian Airlines as one of its Velocity Frequent Flyer partners, although Oneworld exclusivity doesn’t always apply, with Qatar Airways notably being a partner to both Qantas and Virgin Australia.