Alaska Airlines has successfully completed the regulatory investigation by the U.S. Justice Department regarding its acquisition of Hawaiian Airlines. This milestone marks a significant step towards the completion of the $1.9 billion deal between the two carriers. The Justice Department’s review period ended without any legal action to block the merger, clearing the way for the airlines to seek approval from the U.S. Transportation Department.
Leading up to the merger announcement, Hawaiian Airlines encountered multiple challenges that impacted its operations. These challenges included the Maui wildfires, increased competition from Southwest Airlines, and the slower recovery of travel to and from Asia due to the Covid-19 pandemic. Despite facing net losses in most quarters since 2020, Hawaiian Airlines has seen an uptick in booking trends, with shares up nearly 12% this quarter.
The acquisition of Hawaiian Airlines by Alaska Airlines is set to become the largest merger of U.S. carriers since Alaska’s merger with Virgin America eight years ago. Both airlines intend to maintain their individual brands while operating under a unified platform. The combined fleet of more than 360 airplanes will serve over 130 destinations, offering passengers a wider range of travel options.
DOJ’s Precedent with Airline Mergers
The U.S. Justice Department’s recent actions regarding airline mergers add context to the approval of the Alaska Airlines and Hawaiian Airlines deal. In January, the DOJ successfully blocked JetBlue Airways’ acquisition of Spirit Airlines, highlighting the scrutiny faced by carriers seeking to consolidate. Last year, the DOJ also intervened to dissolve a partnership between JetBlue and American Airlines in the Northeast, demonstrating a commitment to maintaining competition in the airline industry.
The clearance of the acquisition of Hawaiian Airlines by Alaska Airlines by the U.S. Justice Department signifies a significant advancement in the merger process. Despite the challenges faced by Hawaiian Airlines, both carriers are optimistic about the future benefits of the combined entity. As the airlines await approval from the U.S. Transportation Department, the industry is poised to witness a major transformation in the U.S. airline landscape.