Articles tagged “virgin america”

Now that the regulatory and legal hurdles are out of the way, Alaska is free to gobble up Virgin America. But what will be left behind?

It's not likely Alaska Airlines would have lost in court, but this case was still a nuisance, so it makes sense that the company resolved it. Now, Alaska can finally focus on absorbing Virgin America.

The Department of Justice has an odd relationship with airlines. It seems to enjoy grabbing headlines about how it's doing its job to protect industry competition. But when it comes time to actually getting airlines to make real concessions, it falls short.

If Virgin America was not expected to merge with Alaska Airlines, analysts likely would fret about Virgin America's falling unit revenue. But since Virgin America is now in limbo, waiting to see if it can close its merger, it's not clear how much the unit revenue decrease matters.

The important stuff is happening in Washington, D.C. where the Department of Justice is considering whether it will seek to block the Alaska Airlines/Virgin America merger. This is more of a minor hiccup, but it's undoubtedly annoying for the two airlines.

There's been some drama related to Alaska's proposed acquisition of Virgin America, but many industry insiders still expect the deal to get done. And Alaska executives remain publicly confident that they will get their prize. The big question is when.

There's almost no chance that Alaska Airlines will keep Virgin America around as an airline for any longer than necessary. But some smaller elements of the Virgin America brand could remain over time.

Yes, Alaska paid a fortune for Virgin America. But that doesn't mean it is a bad deal. Alaska believes it needs Virgin America's assets to compete and grow.

Alaska Airlines continues to play it coy when asked about its plans for the Virgin America brand. But it seems likely Alaska will retire most, if not all, aspects of the upstart's brand.

Sometimes generosity and taking care of your most loyal customers gives a halo that is not immediately visible, but can have long-term benefits and end up saving your skin.