Horizon Air CEO Weighs In On Whether Wholly-Owned Regionals are Safer

I wasn’t planning on revisiting regional airline safety again this quickly, but then I received an email in my inbox this weekend from Horizon Air CEO Jeff Pinneo. Horizon is a wholly-owned regional for Alaska Airlines. Jeff is a regular reader of the blog, and he felt compelled to weigh in on the topic of whether wholly-owned regionals are safer. I’m glad he did. Here’s what he had to say . . .


Hi Brett,

My name is Jeff Pinneo–I’m the CEO at Horizon Air and a pretty frequent reader of your blog. My compliments to you on the good work you do ‘drilling down’ on many aspects of our business that your readers are interested in and want to know more about.

The subject of regional airline safety has certainly been one of those topics in the year following the tragic accident at Colgan, and I think you’ve done a really good job of helping folks take an objective look at Jeff Pinneo Horizon Airthe matter. Your post last week was a good example–in it you bring much needed perspective to the picture without minimizing the overriding importance of safety or of the need for the industry to do everything it can to further improve it’s already strong record. Regarding the question posed in the headline, I’m in general agreement with your conclusion–that being wholly owned by a major airline is not in itself a predictor of a higher level of safety. There are many independent regionals with excellent safety records and solid underlying programs. Having said that, I’ve observed our own evolution since the acquisition of Horizon by Alaska Air Group [AAG] in 1986 (I was at Alaska from 1981-1990 and have been at Horizon ever since), and I can attest to many positive influences and outcomes that have stemmed from our being wholly owned by AAG and a sister company to Alaska Airlines. It all starts with having one board of directors and one chairman (Bill Ayer) who are responsible for the whole enterprise and their obligations for ensuring a consistently safe and dependable experience across the brands. This structure, coupled with their strong personal conviction about the importance of safety, led both board and management to a ‘single standard of safety’ mindset and practices at Alaska and Horizon long before such things were legislated. As a result, both companies have moved virtually in parallel on safety programs from technology (e.g. introduction of heads-up-guidance system (HGS) low-vis technology in early ’90′s, Required Navigational Performance (RNP) and WAAS [Wide Area Augmentation System] program development, etc.) to audit and self-reporting programs such as ASAP [Aviation Safety Action Program), LOSA [Line Operations Safety Audit], FOQA [Flight Operational Quality Assurance] and IOSA [IATA Operational Safety Audit] certification. Our board formed a dedicated board safety committee a decade ago to focus on and reinforce the importance of all these safety improvements. It was the first committee of it’s kind and to this day one of the only, if not THE only, such committee of an airline board of directors.

As a further enhancement to safety oversight, the board in 2008 directed that an Alaska Air Group Vice President-Safety position–one that would be responsible for safety programs at both airlines and report directly to the AAG Chairman and the board safety committee–be established. Tom Nunn, most recently the CEO at Frontier’s Lynx subsidiary, was selected to fill that role late in 2008. Prior to that time, each company had individual safety programs and processes.

So while I agree that the ownership structure of a regional airline is not directly correlated to safety, I can say from our experience that we’ve been distinctly advantaged by our structure and relationship with Alaska Airlines over many years with respect to safety and many other matters. The fact is that many of the structural changes and investments in safety noted above emanated from having a common board and a single chairman who’ve been consistently committed to ensuring nothing less than the highest levels of safety at both operating companies, and to supporting their management teams efforts to that end.

I thought you’d be interested in this background as it relates to what is likely to be a matter of continued public interest in the months ahead. I’ve also attached a fact sheet on Horizon’s flight operations and safety programs that illustrates how our story differs substantially from the many broad-brush characterizations that have been applied–often inaccurately–to the regional airline sector. I’d be happy to discuss all of this in further detail if you wish–I can be reached at xxx-xxx-xxxx. Thanks for your time and interest in these matters.

Sincerely,

Jeff

Jeff Pinneo
President and CEO
Horizon Air


Now, I agree with what Jeff says here, but of course, it could go both ways. Sure, if Alaska has a strong safety culture, that will certainly benefit the wholly-owned regional. But that doesn’t mean that an independent regional can’t have a strong safety culture, as Jeff notes. It also means, however, that a regional that is wholly owned by an airline with a poor safety culture would be negatively impacted.

As I wrote back to Jeff, 10 years ago, Alaska Airlines was found to have serious maintenance issues after the accident of Alaska 261 shined a light on the airline’s practices. That likely negatively impacted Horizon back then, just as they are benefiting from their enhanced attention to safety now.

In short, I think Jeff offers a great perspective from inside a regional, and I thank him for sharing it with me and all of you.

9 Responses to Horizon Air CEO Weighs In On Whether Wholly-Owned Regionals are Safer

  1. David SFeastbay says:

    It was nice to hear from Mr. Pinneo and to get a response from someone that high up in a company. Any company is only good if it’s leaders use common sense and it’s workers care about what they are doing.

    Airline workers of today are not like the airline workers of the ‘golden years’, so alot of what is good or bad with a company hingers on the workers. But it all starts at the top with management making the right decisions and making sure everyone down the line does the best they can.

    Two shows from TV called Air Emergency and Seconds from Disaster have profiled many air crashes including Alaska 261 and so many times it was either pressure from the top that had workers taking short cuts or supervisors and workers just making a wrong decision. Sometimes keeping an airplane in the air at all costs can lead to people rushing and not paying attention to what they are doing.

    So while an airline can make safety its number one priority, just one little slip up some where by one person can cause an accident and give the whole industry a bad rap.

  2. BF says:

    >>>to further improve it’s already strong record.

    To further improve it is already strong record?

    The possessive form of the pronoun “it” does not contain an apostrophe.

  3. A says:

    Cranky, glad to hear you have the big guys in the airline business readying your blog. And per Mr. Pinneo’s letter I’ll probably feel just a little bit safer on my next trip to YYJ. (Not that I haven’t felt safe in the past.)

    Now, I wonder if Richard Anderson is reading your blog? I’ve got me some Delta gripes.

  4. Wonko Beeblebrox says:

    Mr. Pinneo might need to update his photo… it still shows a Horizon CRJ on the monitor in the background. ;)

    Nice to hear from him. I always like flying on Alaska and Horizon.

  5. Greg says:

    Horizon still has 15 CRJs flying. They also have 2 parked.

    Most regional airlines follow the same safety practices, which is unfortunate. Horizon is not an exception. One thing they do have going though is the seniority and thus experience of their pilots. They also used to have experienced mechanics, but they were lured away by Boeing during the manufacturer’s last hiring spree.

  6. Scott says:

    The show is actually a Canadian show called “Mayday” produced for the Canadian Discovery Channel, it’s merely re-branded “Air Emergecy” in the USA. However it’s putting it in the same category as “Seconds from Disaster” is the sad part.

    Also, having flown many many many times YYJ-SEA (and YYJ-CLM-SEA) on QX (and pretty much every other airline that’s done it in the last 30 years), I’m pretty sure you’ve got nothing to worry about

  7. JamesK says:

    While I think it’s great that Jeff has had a positive experience with Horizon after the Alaska acquisition, it’s unfortunately not the rule for “wholly-owned” regionals. All too often, the wholly-owneds can’t get approval for investment in technology from the finance department of the parent company.

    Take a closer look at the improvements made at regionals before and after spinoffs (or acquisition by another regional). Regionals that have gotten things like FOQA, ACARS, IOSA, Cat III, etc., first are often those that aren’t owned by a major. Horizon is the only regional I’m aware of that has RNP or HGS capability on their fleet (though Bombardier and Embraer are more than willing to install them for the right price).

    I think the FAA and NTSB are rightly focused on rapidly expanding carriers, not just regionals and not just regionals not owned by a major. Well-established regionals tend to have captains with a lot of experience, good training programs and safety records to match. Small carriers that add a ton of bigger aircraft all at once are going to struggle to fill those cockpits, whether it’s a Q400 or a 767.

  8. Cranky,
    Thanks so much for the many views and issues you get out in the open. This airline safety issue is most important to me as an airline mechanic of 21 years. I find the views of Mr. Pinneo very interesting, and appreciate his candor. If I may however, offer some thought that causes me to question the sincerity of his words regarding “…a common board and a single chairman who’ve been consistently committed to ensuring nothing less than the highest levels of safety at both operating companies.” The simple fact is that Alaska Airlines in more recent years has escalated the outsourcing of much of their aircraft maintenance to outside vendors turning away from their own trusted and experienced mechanics. The move and direction by this same board of directors, if I am not mistaken, is to continue outsourcing even more regular “check” maintenance including parts of the regular line maintenance at Alaska. I understand this move to outside vendors is also expected to spread to the Horizon maintenance check schedule as well, and there is talk of “C” checks being outsourced and sent to vendor maintenance. My issue, and mistrust in the phrase continually used by these two companies -”the highest levels of safety”- is that the move to outside aircraft Maintenance Repair and Overhaul facilities (MRO) is a move based purely on cost savings and cutting corners. The corners cut are in the differences in the requirements governed by the FAA for the Air Carrier’s and the lessor standards for the MRO’s. All airline repair is regulated by a series of Federal Aviation Regulations (FAR). MRO’s are governed by FAR 145, and the Air Carriers fall under the higher standards of FAR 121. Both FARs however represent only the minimum level of safety and not the high level that all airlines operated under for years before the deregulation act of 1978. The emergence of low cost carriers, created a market of MRO’s that operates largely using more affordable minimums. But the FAA ultimately holds the air carriers responsible for all maintenance that is done, and is why commercial air carriers, including Alaska and Horizon, had employed much higher standards for in house maintenance. Simply put, by outsourcing maintenance, airlines are selling off safety and reliability to the lowest bidders, marginalizing standards, and risking lives based on the statistics of the “safety of air travel”. I do not work for either of these airlines, and while there is allot I do know about aircraft repair, I realize at the same time there is still so much to learn. Still, I would hardly call the practices of outsourcing maintenance “the highest levels of safety”. Mr, Pinneo, please do not follow the other airlines in stepping over dollars to pick up pennies. Put trust instead to your own Mechanics, and continue to earn the rewards they have delivered to you so far. You can do this by keeping all of your maintenance in house.

    • Greg says:

      David- You have hit the nail on the head. There are some safety practices where they do well. But there are many where they follow the absolute lowest cost route. I have spoken with Mr. Pinneo a few times. He is a very nice man. But, he is also extremely good at twisting anything to what he thinks you (or in this case) what the public wants to hear.

      In a few instances I have seen them do the right thing for safety. But, their recent practices of short staffing the airline to an extreme is hurting our safety. And from my pilot perspective, they have always followed the FAA minimum rest requirements to the letter of the law. As we have seen by the testimonies resulting from the Colgan crash, the letter of the law is incredibly inappropriate.

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