How an Alaska Air-Hawaiian Airlines merger could destroy cheap flights
If the agreement takes place, travelers will probably see fewer affordable prices, the experts warn.
Plane ticket booking always requires a strategy. Depending on the flexible of your dates, you can play to find the lowest rates, or even consult another airport if there is another option nearby. When you get this unbeatable price, you cannot deny the feeling of accomplishment, especially if it means that you can put more money to other parts of your vacation. But these cheap flights could soon be something in the past thanks to a new fusion between Alaska Airlines and Hawaiian Airlines. Read more to find out why experts think that the planned union of carriers could end up costing travelers more.
In relation: Delta on -board agent reveals that Sneaky Way Airlines encourages you to miss your flight .
Alaska Airlines buys Hawaiian for almost $ 2 billion.
In a press release on December 3, Alaska Airlines announced plans to buy Rival Hawaiian Airlines for $ 1.9 billion.
"This combination is an exciting step in our collective trip to provide a better travel experience to our customers and expand options for travelers from the west coast and Hawai'i", " Ben Minicci Said Alaska Airlines CEO in the press release. "We have long -standing and deep respect for Hawaiian airlines, for their role as high -level employer in Hawai'i, and for the way their brand and their people carry the warm culture of aloha in the world entire."
The agreement implies that Alaska takes $ 900 million in the debt of Hawaiian airlines, as reported by the airline continuous losses Since the beginning of 2020, CNBC has reported. The carrier had trouble following MAUI forest fires this year, as well as the increase in competition from Southwest Airlines in Hawaii.
In relation: 5 changes to major airlines you should expect this holiday season: United, Southwest, and more .
The agreement must be approved before it can take effect.
The two carriers will keep their own mark under a single platform, according to the press release, but before they can unite their forces, they will need the approval of federal regulators. AE0FCC31AE342FD3A1346EBB1F342FCB
In the past, these mergers have been Problem -free , Reported CNN, reducing the number of large American airlines from 11 to only four. (United, Delta, American and Southwest control around 80% of the American market. Alaska is the fifth largest airline in the country.)
President Joe Biden However, the Ministry of Justice was strictest in terms of merger. In 2022, the Ministry of Justice won a trial to break a regional partnership between JetBlue and American, and it currently challenges a merger between JetBlue and Spirit Airlines, CNBC reported.
While small carriers argue that they have to merge with larger ones to compete, Biden administration maintains that mergers reduce the number of choices for customers and increase prices. If Alaska and Hawaïian have the green light to team up, industry experts say that is exactly what will happen.
Expect cheaper flights, the experts say.
Speak with Fox Business, Katy Nastro , Goin.com Expert Travel Expert, explained that the merger of Alaska-Hawaiian, like other mergers, get rid of competition And has an impact on prices.
"Competition between airlines means that they have to come to the table with something to provide consumers to influence their purchasing decision," said Nastro. "Regarding this, for a leisure consumer, the price will always be the decisive factor."
Consumers "want competition" whatever happens, she explains, noting that people generally want more than one airline to choose in certain airports or for certain routes. With the merger of Alaska and Hawaiian, these options decrease, which ends up harming the consumer.
Founder of Goming.com Scott Keyes echoed this word with The Washington Post , noting that competition is " The biggest cause cheap flights. "He added that the merger between Alaska and Hawaii, which have overlapping flight routes," would also train cheapful flights for consumers, but less. ""
Fortunately, Nastro told Fox Business that even if the merger should produce less cheap flights, this does not mean that you can never find a cheap price or that global prices go up to the sky.
In relation: Southwest passengers ask that the airline ended the early embarkation "scam".
A property could also come from the agreement.
We may not be impatient to further overflow the plane ticket, but Nastro also told Fox Business that the agreement could be beneficial for certain American citizens.
"Especially if I live in Hawaii or on the west coast, I can now get more connectivity in Asia potentially," she said. "They definitively consider Honolulu as this kind of bridge for Alaska [airlines]."
For a December 3 call with investors , Minicucci has also resolved it, noting that the merger would give these customers "a huge choice, an extended national platform, an enlarged international platform".
In addition, unlike Keyes' argument on Hawaiian airlines and Alaska eliminating cheap flights because they serve so much routes, airline leaders have declared that shared routes could be a pro for regulators .
"When you combine these complementary networks, we will have around 1,400 flights per day," said Minicucci when investing. "On these 1,400 flights, we only have 12 overlapping markets. So, from a competitive point of view, I think it really lands, really good."
In relation: For more information, register for our daily newsletter .
