EXHIBIT 99.2
Contact: Lou Cancelmi -or- Sam Sperry
206-392-5170 206-392-5038
FOR IMMEDIATE RELEASE September 9, 2004
ALASKA AIRLINES CLOSING OAKLAND MAINTENANCE BASE
SEATTLE -- As part of an ongoing effort to improve its competitive
standing in the post-9/11 airline industry, Alaska Airlines announced today that
it will contract out all heavy maintenance work.
Up to now Alaska has contracted with vendors for about 60 percent of its
heavy maintenance, while the other 40 percent has been done by its staff at its
Oakland hangar . Effective today, the Oakland facility will be closed and the
work transferred to two vendors.
Alaska employs 340 people at the base -- some 80 percent of them licensed
aircraft technicians. The remainder serve in various administrative and support
functions. Depending on seniority, bargaining unit employees will be laid off or
given the opportunity to bid into other maintenance locations in the Alaska
system.
The move is part of a wide-ranging series of streamlining initiatives the
airline is announcing today, and comes on the heels of a management
reorganization that started last month. All told, Alaska is trimming nearly 900
of its more than 11,000 employees and either contracting out work or, with
regard to management, reorganizing to achieve the same results with fewer
people. The collective savings is projected at between $30 million and $35
million per year.
"Our commitment to secure the future of Alaska Airlines -- to first ensure
our survival and then return us to a position of strength in this permanently
changed industry -- has forced us to make some very tough decisions that impact
good people," said Alaska CEO Bill Ayer.
"Our Oakland technicians are highly talented and have made great strides
over the past years by implementing new systems and processes," added Ayer.
"They did their work well, but the reality is that large-scale maintenance
providers can give us the same excellent quality at a lower cost."
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Alaska's heavy maintenance work now will be done entirely by two
contractors: Goodrich Aviation Technical Services in Everett, Wash. and AAR
Aircraft Services in Oklahoma City, Okla. Goodrich has performed heavy
maintenance for Alaska for nearly three decades and AAR has been the exclusive
heavy maintenance provider for the carrier's MD-80 fleet for more than a year.
For employees impacted, Alaska has talked with union leadership about the
possibility of offering one of the most generous severance packages since 9/11
triggered 100,000 layoffs at other carriers. That package would include two
weeks of pay for every year of service, a lump sum bonus based on years of
service, company-paid health insurance coverage for one year and extended travel
benefits.
To help minimize the number of involuntary departures, the airline has
proposed to offer the same voluntary severance package to other maintenance and
engineering employees at other locations, based on seniority and on a
one-for-one basis, in the hopes of creating openings for those displaced in
Oakland or via seniority bumping.
Closing the maintenance base will have no impact on Alaska's staffing or
flight schedules at Oakland International Airport.
The employees of the Oakland maintenance base, which Alaska acquired in
1988, worked almost exclusively on the airline's fleet of 74 Boeing 737
aircraft.
Alaska Airlines has provided air service at Oakland International Airport
since 1983. Alaska, and its sister carrier, Horizon Air, serve more than 80
cities in Alaska, the Lower 48, Canada and Mexico. For more news and
information, visit the Alaska Airlines Newsroom on the Internet at
http://newsroom.alaskaair.com.
This release may contain forward-looking statements that are intended to
be subject to the safe harbor protection provided by Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These statements relate to future events or future financial performance and
involve known and unknown risks and uncertainties that may cause actual results
or performance to be materially different from those indicated by any
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "forecast," "may," "will," "could," "should,"
"expect," "plan," "believe," "potential" or other similar words indicating
future events or contingencies. Some of the things that could
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cause actual results to differ from expectations are: economic conditions; the
continued impact of terrorist attacks, global instability and potential U.S.
military involvement; the company's significant indebtedness; downgrades of the
company's credit ratings; the competitive environment and other trends in the
company's industry; changes in laws and regulations; changes in the company's
operating costs including fuel; changes in the company's business plans;
interest rates and the availability of financing; liability and other claims
asserted against the company; labor disputes; the company's ability to attract
and retain qualified personnel; and inflation. For a discussion of these and
other risk factors, see Item 1 of the company's Annual Report on Form 10-K/A for
the year ended December 31, 2003. All of the forward-looking statements are
qualified in their entirety by reference to the risk factors discussed therein.
These risk factors may not be exhaustive. The company operates in a continually
changing business environment, and new risk factors emerge from time to time.
Management cannot predict such new risk factors, nor can it assess the impact,
if any, of such new risk factors on the company's business or events described
in any forward-looking statements. The company disclaims any obligation to
publicly update or revise any forward-looking statements after the date of this
release to conform them to actual results.
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