Alaska Air Group Cuts 200 Back-Office Jobs as Fuel Costs Bite
Alaska Air Group is laying off 200 employees. The company announced the cuts on Friday and tied them to high fuel prices and other geopolitical pressures.
All of the affected positions are non-union back-office roles. Pilots, flight attendants, airport guest services and maintenance and engineering staff are not touched. A company spokesperson said 125 of the people let go are based in Washington. Another 48 are in Honolulu, where Hawaiian Airlines is headquartered.
The group has 32,500 employees, so the cuts affect less than 1% of the workforce. Those laid off will work their last day on Nov. 13. They will keep receiving pay through Dec. 31.
A projected loss of about $700 million
CEO Ben Minicucci explained the move in a note to staff. "To remain competitive and emerge from this challenging period stronger, we must continue investing in our fleet, guest experience, capacity and network," he wrote. "At the same time, we must return to the financial discipline that has long been a key competitive advantage. That means taking a hard look at overhead …"
Minicucci added that a $700 million shortfall this year, as projected, would mark the first time since 2003 that the group posts an adjusted pretax loss, pandemic years aside.
The group includes Alaska Airlines, Hawaiian Airlines, regional carrier Horizon Air and ground support company McGee Air Services. It lost $416 million in the first nine months of the year. A year earlier it reported $79 million in profit over the same period.
When it released its October results, Alaska said elevated fuel costs would keep weighing on the business. It counted $1.8 billion in fuel expenses above its initial guidance for the year. It projected a full-year loss of $5 to $5.50 per share.
At an investor day in September, executives pointed to the benefits of the Alaska Accelerate expansion plan. It began in 2024, shortly after the Hawaiian Airlines acquisition.
The plan covers a loyalty program, a premium credit card and lie-flat suites on planes, plus lounges and more than a dozen nonstop long-haul international routes from Seattle. Even so, executives cautioned that the company could miss its 2027 targets of $1 billion in incremental profit and $10 earnings per share, blaming mostly jet fuel prices.
Alaska Air Group shares were down 1.2% on Friday.
Source: Anchorage Daily News