Alaska’s 787s Face An Uphill Fight

Alaska Airlines is new to twin-aisle operations. It began operating the Hawaiian-ordered fleet of 787-9s, and US DOT data show this is an uphill battle. Alaska now has to feed its own service out of its Seattle hub. Even as this is a 'long game', the hurdle is significant, and competitors are happy to push it even higher. US DOT data shows how big a hurdle Alaska has to overcome. The Data These charts are based on DOT's T-100 International Segment. US DOT; AirInsight Overall, the curves point in the right direction. Except for load factors and passengers/flight. There was an initial bounce, and the trends softened. June improved, but it's still below the highs. The airline's 787-9 fleet is tiny, with only five on hand. That means every flight has a bigger impact than its competitors'. Competitive Context When we compare Alaska with other US 787-9 operators, the picture is more stark. We have red arrows pointing to key items. US DOT; AirInsight The unsold seats are item #1. When operated by Hawaiian, these aircraft performed much like other airlines. At Alaska, they are facing an uphill battle. The unsold seats speak to the feed and routes from Seattle. For example, in the Italian market, Alaska averages 89 empty seats compared to American's 38 and United's 23. In the Japan market, Alaska averages 64 empty seats; American averages 37, and United averages 28. Look at payload/flight where you see Alaska performing worse than Hawaiian and its competition. As the next chart shows, freight plays a big role here. Bottom Line Alaska is new to these markets with a new aircraft. It has the right model, but it appears feeding these routes is more challenging. The challenge isn't just 787 operations. Out of Seattle, Alaska has to compete with Delta, which is now using Seattle as a hub. Delta's feed is larger and more established. This is especially true for freight. The question is how long Alaska can/will keep this up. The airline seems committed to international service with the 787. Which makes sense, but it might have done better leaving them in Honolulu. After all, consider HNL-LHR. The 787-9 has a published range of 7,565 nautical miles (about 14,010 km) under typical conditions. The great-circle distance from HNL to LHR is about 6,289 nautical miles (about 11,647 km). That leaves a solid margin of roughly 1,200+ nautical miles for headwinds, reserves, payload, routing, and other operational factors. Recent FAA approvals for higher maximum takeoff weights on the 787-9 can further increase range (by a few hundred nautical miles in some cases) when needed. No airline currently schedules nonstop HNL–LHR service, and this might be as good a market as Hawaiian originally thought. Hawaiian’s then-CEO Peter Ingram publicly noted that the 787-9’s range opened up “interesting possibilities such as London and Perth.”

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