What the Alaska-Hawaiian Airlines Merger Could Mean for Travelers

11.12.2023 - 12:07 / cntraveler.com / Henry Harteveldt / Airlines

Seattle-based Alaska Airlines recently announced it plans to buy Hawaiian Airlines for the sum of about $1.9 billion—a historic deal that, if finalized, could create both benefits and setbacks for the flying public.

The deal would see America’s fifth largest airline combining with the tenth largest domestic carrier. Both Alaska and Hawaii are US states that “are uniquely reliant upon air travel,” Alaska Airlines said in a release. “This combination is an exciting next step in our collective journey to provide a better travel experience for our guests and expand options for West Coast and Hawai‘i travelers,” Ben Minicucci, Alaska Airlines CEO, said.

So what are the details of the deal—and what does it all mean for travelers? At this point, there are still many unknowns, as most of the particulars will have to be negotiated and finalized with federal regulators. “What’s important to remember is that just because they announced the intention to merge, doesn’t mean that the merger happens overnight,” says airline industry analyst Henry Harteveldt.

Typically, airline mergers tend to decrease competition, raising flight prices as a result. In this particular case, fares could rise in three distinct markets, according to William McGee, a senior fellow for aviation and travel at the American Economic Liberties Project, a group that is urging the DOT and the DOJ to oppose the deal.

“Fares will rise within Hawaii; between Hawaii and the mainland; and throughout the Pacific Rim, from Australia to Japan,” McGee says. That's because Hawaiian's route map reaches into Asia and Oceania, which would give Alaska a foothold in the region post-merger.

The merger wouldn't just decrease Alaska's competition in the region. Since the airline is a member of the global airline alliance Oneworld, its partners like American Airlines, Japan Airlines, and Qantas would also benefit from shrinking competition in the Pacific Rim, according to the American Economic Liberties Project. That would give them more leeway to charge higher fares.

The merger could raise flight prices in three markets: within Hawaii; between Hawaii and the mainland; and throughout the Pacific Rim, and from Australia to Japan.

According to McGee, the merger could also increase the cost of intra-island flights, which local residents frequently use to commute to work, visit family, and travel to school, medical appointments, or military assignments.

For its part, Alaska Airlines said in its release that it’s “fully committed to investing in the communities of Hawai‘i and maintaining the Neighbor Island service that Hawaiian Airlines travelers have come to expect.”

The fact that Alaska is part of a major airline alliance could have positive implications, too.