Corporate business will be a bigger part of Alaska Airlines'
portfolio once it completes its acquisition of Virgin America, Alaska executives
said during an earnings call.
Alaska Airlines has a "relatively small" base of
corporate business in Seattle but expects that to change after incorporating
Virgin America's network, particularly clients in Southern California and
the Bay Area, executives said. Alaska already has a corporate-sales presence in
San Francisco but also plans to leverage the Virgin team's relationships with
tech companies in the area, many of which also have operations in Seattle. "We
don't have exact numbers, but that will evolve, and corporate will become a
more important part of our network," senior vice president of
communications Joseph Sprague said.
Virgin America shareholders will vote on the acquisition in
the second quarter, and Alaska executives hope for quick clearance of the deal from
the U.S. Department of Justice. Even if the DOJ takes a deeper look, Alaska expects
it to clear by the end of the year, CEO Brad Tilden said. "The combination
strengthens our two airlines and enhances competition," Tilden said.
"We both run strong operations, both are recognized for customer service
and have two of the youngest and most fuel-efficient fleets."
During the first quarter, Alaska's operating
revenue increased 6 percent year over year to $1.3 billion. Traffic increased
10.3 percent, and capacity increased 12.1 percent. Load factor dropped 1.3
percentage points to 82.5 percent. Alaska reported a net income of $184 million
for the quarter, up from $149 million in the first quarter of 2015.