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Two Can Play at This Game: Alaska Air Takes on Delta’s Salt Lake City Hub

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Two Can Play at This Game: Alaska Air Takes on Delta’s Salt Lake City Hub

Two Can Play at This Game: Alaska Air Takes on Delta’s Salt Lake City Hub
December 06
10:39 2013

MIAMI — Alaska Air announced that they are adding four new nonstop routes on Friday. And all of them are going to Salt Lake City. Typically such news wouldn’t be worthy of its own article, except that Salt Lake (SLC) is Delta Air Lines’ largest western hub. The news continues to fuel fires that a turf war between the two is in progress.

The Seattle-based carrier will add service to SLC via Los Angeles (LAX), Portland (PDX), San Diego, (SAN), and San Jose (SJC) beginning on June 4th. It is also adding an additional daily frequency to SLC out of Seattle. The extra flights are a major boost to a city that only began receiving service from Alaska earlier this year, in April. Following the announcement stocks for Alaska were down nearly 4% on Wall St.

To “celebrate the new service” (as the press release put) Alaska is offering members of its frequent flier program, dubbed Mileage Plan, double miles on all routes. The release noted that members of their plan can earn MVP level status faster than at competing airlines (20,000 vs 25,000).

And it isn’t hard to figure out who that dig is aimed at: Delta Air Lines. The two have been involved in an increasingly interesting battle over the Western US.  Both carriers have been careful to avoid characterizing this as a fight, with an Alaska spokesperson stating yesterday in an email to Airchive that “While it’s likely there will be markets where we’ll continue to work together with Delta on their international growth, there are also domestic routes where we’ll compete.” Alaska later went on to state that “It’s in the best interests of Alaska Air Group to defend our core markets.”

Yet it is hard not to view this latest move as a classic “two can play at this game”. Delta (DL) recently announced a significant expansion from Seattle into Alaska’s secondary hub of Portland. DL has also announced expansion into a number of Alaska’s biggest markets, ranging from LAX to Vancouver, BC, Anchorage to San Diego. Until now Alaska has largely stayed on the sidelines and watched as Delta’s plans unfolded, but this latest move into a Delta hub (that Alaska previously didn’t appear to care much about) would indicate they are ready and able to go on the offensive.

Upon closer scrutiny of Alaska’s press release, a few interesting things pop out. The obvious one, as we noted above, is the dig at Delta’s frequent flier program. It has become increasingly obvious that most of Delta’s domestic expansion has been geared toward the high yield (big money) international business and frequent flier demographic. Alaska’s double reward offerings, plus their dig, reminds folks there’s a reason to stick with AS in the US and gives them an incentive to do so (that plus DL has made similar offers to their frequent fliers when starting new routes out of Seattle).

Also interesting was the focus on network. Delta has been hammering Seattle with ads touting that they are Seattle’s global airline (note that they carefully avoid saying ‘hometown’ airline; perhaps they know they aren’t going to beat AS on that front quite yet). Alaska took the opportunity to remind folks that their network isn’t something to forgotten about either.

In an interesting periphery engagement, DL unveiled a “Spirit of Seattle” 737-900 yesterday (one of two cities in DL’s network to receive the honor). The unveiling of the airplane prompted Alaska to remind Delta on twitter that they were the original spirit of Seattle. Alaska, responding to an email inquiry, added late yesterday that they had “no response” to the airplane, but that they did “enjoy recognizing our special home town of Seattle as we’ve done with our Spirit of Seattle airplane for several years.”

Related, Alaska’s move mirrors that of United Airlines (UA) back in October. Responding to Delta adding flights into United’s San Francisco (SFO) hub, UA added flights to DL hubs Atlanta, LAX, and Minneapolis (MSP). It also announced up-gauging aircraft on Seattle-SFO as well as adding an additional flight.

In any case, the two carriers–Alaska and Delta–still maintain a relationship with one another that is rather cozy in some respects, which continues to make this battle all the more interesting. The two cooperate on awards programs and feeder traffic among other things. Though for two companies that like supposedly like one another, the actions of late are a funny way to show it.

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A Global Review of Commercial Flight since 1994: the leading Commercial Aviation publication in North America and 35 nations worldwide. Based in Miami, Florida.

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