Today the U.S. Department of Justice gave Alaska Airlines permission for the Virgin America take-over. For those of you unfamiliar with this news, look back to last April where Alaska successfully outbid (at a huge price) Jet Blue for the flailing Virgin America. This take-over has been met with a lot of backlash among the Virgin loyalists who are really worried about the potential changes that Alaska is going to make. To Alaska’s credit, they are overall a well-liked and favored airline among most of their passengers due to their on-time performance and a friendly attitude. They also have a great miles program called MileagePlan that offers some great deals (I’ve found a lot of value with their partner American Airlines, where you can redeem 20,000 miles per leg to fly economy to American’s European connections, or 25,000 for Americans routes to Asia).
Accolades on both sides of the merger
Despite mostly positive feelings toward Alaska Airlines, a current lawsuit based around the merger sits in Virgin’s hub of San Francisco. This is pretty much the only thing standing in their way. The private plaintiffs who filed the suit are still holding on, claiming that the merger will only create less competition from their West Coast Airport powerhouse and airfares will only rise. Of course Alaska claims the exact opposite, believing that a merger will only be good for competition as it will allow them to compete with the big three (I would assume United to be most threatened as it’s a major, major hub for them, and they are not partners with Alaska). According to the Alaska press release and Brad Tilden, the CEO of Alaska, “The expanded West Coast presence and larger customer base create an enhanced platform for growth, which is good for investors, employees and especially customers – who benefit from more choices, increased competition and low fares.”
UPDATE: 12/07/16 — The Lawsuit was settled by Alaska Airlines. They are clear for merger, although we are still waiting on the news for the official closure…
The new route map featuring the routes Alaska will gain upon completion
With the DOJ approval of the merger, Alaska is that much closer to finishing the transaction. It could even be completed in days! Some things to keep in mind from this approval are the concessions that Alaska had to make, mainly with removing some codeshare flights with American. Probably worth it if you ask me. We’ll see exactly how that plays out and how much Alaska changes the brand and following that Virgin America has established, but I think it’s going to work out better for those of us in the game. A combined MileagePlan could be incredible as Alaska’s award availability on routes will become easier to find on trips to the east coast. This will also certainly increase Alaska’s presence to and from Hawaii as it will open up more direct routes to the islands. Also for those with Virgin America’s Elevate program, we’re not exactly sure how the points will transfer over post-merge of programs, but if Alaska decides to bring them over 1:1 it’s going to be a great deal going forward. Personally, as I’m a fan of Alaska Airlines and their MileagePlan, I think this merger is a win/win for customer and consumer. They are also an airline that is pushing the envelope on becoming more environmentally friendly, which is always a good thing.