UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to section 13 or 15(d) of the Securities Exchange Act of
1934
June 5, 2000
(Date of Report)
Commission file number 1-8957
ALASKA AIR GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 91-1292054
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
19300 Pacific Highway South, Seattle, Washington 98188
(Address of principal executive offices)
(206) 431-7040
(Registrant's telephone number)
ITEM 5. Other Information
FAA Audit
On June 2, 2000, the Federal Aviation Administration (FAA)
submitted to Alaska Airlines a letter detailing some of its
findings from the review of Alaska's maintenance program that the
FAA conducted following Alaska's January 31, 2000 aircraft
accident. The FAA indicated in this letter that it observed
certain maintenance practices and procedures of Alaska that were
not contained in Alaska's General Maintenance Manual. In
addition, the FAA stated that it requires a continuing analysis
and surveillance system capable of detecting and correcting the
kind of deficiencies found in Alaska's heavy maintenance program.
Alaska has been working on a number of issues raised by the FAA
in the course of its audit, which ended on April 19, 2000. The
FAA acknowledged Alaska's satisfactory response to these issues
to date, but indicated also that it was concerned about Alaska's
ability to continue to meet its responsibilities and identify and
correct deficiencies in the program. In order to validate the
integrity of the changes Alaska has made and continues to
develop, the FAA is implementing a special emphasis surveillance
plan. This program will include close monitoring of Alaska's
maintenance activities and review of the records pertaining to
any Alaska aircraft being released from heavy maintenance.
To ensure that Alaska properly implements these measures, the FAA
has proposed to amend Alaska's operations specifications to
withdraw its authority to perform "C" and "D" checks on B-737-200
aircraft, "C" checks and structural inspections on B-737-400 and
700 aircraft, and "C", 15K and 30K checks on MD-80 aircraft.
This proposed restriction would remain in place until the FAA has
fully validated the measures Alaska has implemented.
Alaska has until June 9, 2000 to submit a response to the FAA's
proposal. If the FAA proceeds to implement the amendment despite
Alaska's response, it will so notify Alaska, and the action would
be effective 30 days from the date of notice. Alaska could
further postpone the effectiveness of the amendment by
petitioning the FAA for reconsideration. The FAA also indicated
that the proposed amendment may be unnecessary if FAA is assured
that Alaska's revised procedures are functioning properly.
The FAA in its letter also stated that it will monitor Alaska's
plan for fleet growth to ensure that any expansion will be
consistent with the improvements Alaska is making to its
maintenance procedures.
Alaska has endeavored to work openly and constructively with the
FAA throughout this process. As indicated in the FAA's letter,
Alaska has already responded to the FAA's satisfaction on
numerous issues. Some of the actions Alaska has taken include:
* Electing a new Vice President of Safety and an Interim
Director of Safety
* Electing a new Vice President of Flight Operations
* Appointing a new Staff Vice President of Maintenance
* Establishing a direct employee Safety Hotline to the Chairman
and CEO
* Appointing a new Manager, Base Maintenance, Seattle
* Hiring 70 Maintenance and Engineering employees, more than
half of whom are mechanics
* Changing the General Maintenance Manual to assure clarity and
consistency of procedures and policies
* Implementing a schedule recovery plan to ensure that all
equipment unrelated to safety of flight is in optimum condition
for the busy summer schedule
* Completing a review of every "C" check aircraft in the fleet
to ensure that all paperwork was properly accounted for and that
all work was properly done. Results of that review - overseen by
the FAA - demonstrated that 99.94 percent of the 257,000
documents reviewed were in conformity.
* Instituting a policy to require the approval of the Vice
President/Maintenance and Engineering or the Director of Quality
Control and Training before the release of any aircraft from
heavy check
* Establishing weekly meetings attended by FAA officials and
senior Alaska maintenance and engineering personnel to review
progress on all programs in progress and to ensure that all
activities remain on schedule
Alaska has devoted substantial resources to this effort, is
committed to the goal of making unnecessary any restriction on
its ability to do heavy maintenance, and is confident that it
will achieve this goal.
FORWARD-LOOKING INFORMATION
This report may contain forward-looking statements that are based
on the best in formation currently available to management. These
forward-looking statements are intended to be subject to the safe
harbor protection provided by Section27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are indicated by phrases such as
"will", "should", "the Company believes", "we expect" or any
other language indicating a prediction of future events. There
can be no assurance that actual developments will be those
anticipated by the Company. Actual results could differ
materially from those projected as a result of a number of
factors, some of which the Company cannot predict or control. For
a discussion of some of these factors, please see Item 1 of the
Company's Annual Report on Form 10-K for the year ended December
31, 1999.
Signature
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
ALASKA AIR GROUP, INC.
Registrant
Date: June 5, 2000
/s/ Bradley D. Tilden
Bradley D. Tilden
Vice President/Finance and Chief Financial Officer
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