Alaska Air becomes first to cut flights due to fuel spike

By Oregon Small Business Association Foundation,

Rising fuel costs prompted Alaska Airlines to trim capacity, and it may speed up replacement of old aircraft with newer more fuel-efficient planes, according to the Puget Sound Business Journal. Long-term contracts for fuel and a “fortress” of a balance sheet provide a cushion of 18 to 24 months, Chief Financial Officer Shane Tackett said. Alaska plans to return to pre-pandemic levels by summer and anticipates growth in the second half of the year, according to its regulatory filing. However, the airline will adjust capacity as needed if fuel prices continue to soar. Alaska, which is Portland International Airport’s largest service provider, is the first major airline to announce a reduction in capacity, or available seat miles. Alaska inherited older Airbus airplanes when it acquired Virgin America and planned to replace 60 of those with Boeing 737 Max 9’s but may opt instead for the newer Max 10s, which seat 189.

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