Alaska’s Shifting California Presence

Alaska Airlines

Last week, Alaska announced three new routes from San Diego. It may not be a large add, but it does highlight just how much Alaska has changed in California since the pandemic has begun. San Diego has become one of the airline’s most important airports while other cities in the Golden State have fallen off.

Prior to the Virgin America merger, Los Angeles was far and away the most important city in California for Alaska. The airline had around 150,000 monthly seats in the market, all going from Anchorage in the north to México in the south, the only exception being the lone daily flight to Washington/National it had won in the beyond-perimeter sweepstakes. It barely served intra-California markets.

Alaska Departing Seats From Top Four California Airports

As the chart above shows, however, San Diego started to really separate itself into a clear second place from about 2013. Between Jun 2012 and the end of 2013, Alaska launched flights from San Diego to Boise, Boston, Fresno, Līhuʻe, Mammoth Lakes, Monterey, Orlando, and Santa Rosa. This was everything Los Angeles was not, allowing Alaska to expand its footprint into markets not anchored by its Pacific Northwest stronghold.

These new routes brought Alaska firmly into the intra-California market from San Diego, while also going all the way to the East Coast. More transcons would follow.

The Virgin America merger changed Alaska’s situation in California, as the airline had planned it would. That airline had major operations in both San Francisco and Los Angeles. When we look at the combined airline up until the pandemic, the story was a different one.

Alaska + Virgin America Departing Seats From Key California Airports

With Virgin America, San Francisco vaulted toward the top of the heap, and Alaska focused there more after the merger. Los Angeles remained as important, but you could see both San Diego and San Jose creeping up.

Then came the pandemic, and that turned everything on its head. I’ll keep that chart above, but then add on the post-pandemic world.

Alaska + Virgin America Departing Seats From Key California Airports

This looks like a very different airline. San Francisco was the slowest to recover after the pandemic, but it has been making up for lost time in the last year. It overtook Los Angeles as largest airport in California for Alaska in Jan 2022 and it has not looked back. In the May schedule, SFO is 23 percent larger than LAX.

Meanwhile, LAX has flattened at a level far lower than where it was pre-pandemic. There are definitely some gate constraint issues there as the Terminal 6 renovation proceeds and multiple gates remain off limits, but it’s more than that. I spoke with Brett Catlin, VP of Network and Alliances for Alaska, and he explained that with the costs to operate at LAX predicted to climb much higher in the coming years, Alaska has to think twice about what kinds of flying it can support at the airport.

I can only assume that would explain why Alaska just left the LAX – Fresno market. Spreading out those costs on a 76-seater on such a short hop is tough. That being said, Brett noted that they will be looking to grow more with mainline in particular once they get their gates and the customs facility back in operation. But Alaska is currently 25 percent smaller at LAX in May 2023 than it was in May 2019, and I have trouble seeing how it would get back to where it was anytime soon.

So it’s a recovery story in San Francisco and a story of shrinkage in LA and elsewhere. All of the California markets are an order of magntitude smaller than they were before the pandemic… except one.

Alaska + Virgin America % Change Departing Seats May 2023 vs May 2019 From Key California Airports

While one of the rising stars — San Jose — has fallen off dramatically since the pandemic, San Diego has only grown. For it to be above pre-pandemic levels as it is shows a stark contrast to the other California markets.

And Alaska continues to look for opportunity to grow there, as hard as that is in an airport with constraints.

Last week it announced it would add 1x daily to Eugene, an obvious opportunity in the airline’s heartland in the Pacific Northwest. But it also jumped into Washington/Dulles with 1x daily, something United did not appreciate. United will add a 4th daily in the market this summer with a monstrous 364-seat 777-200. Alaska has also filed a winter flight to Tampa.

It would seem that San Diego has proven to be the winner in California for Alaska, if you had to pick one. The airport is constrained, but Brett explained to me that they have the ability to add there more than you might expect. Of course, when the new Terminal 1 opens fully in 2027, there will be plenty of room, but Alaska isn’t waiting until then, and it doesn’t have to. Keep an eye on that corner of the country. The Eskimo likes what it sees.

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43 comments on “Alaska’s Shifting California Presence

  1. Stupid question – why is it called Alaska if it is based in Seattle, has a huge presence in California & extends it’s route network cross country as well as overseas?

    1. It was founded in Alaska and until early in deregulation it flew exclusively in Alaska, except for flights to Seattle. I assume it moved its operational and corporate headquarters to Seattle because it was a lot easier and cheaper to have maintenance and corporate offices there. Deregulation coincided with the wind down of construction of the oil infrastructure in Alaska, so the airline saw that the future as an essentially-intra Alaska airline was not good.

      United, the dominant airline up and down the West Coast, decided to retreat from that part of the country and use the assets to fortify its hubs, so Alaska saw an opportunity and took it, just about the time Seattle’s tech industry took off. It bought the regional airline Horizon Air and built a true hub-and-spoke operation in Seattle and the rest is history.

      1. The US has always had strange geographical airline names. Southwest started as an intrastate carrier in Texas, which is not in the “southwest”. “Eastern” and “Northwest” outgrew their reginal names like Alaska has. And now “PSA’ flies in the east. (That one makes me sad, I loved me some Grinningbirds back in the day.)

        1. The Showband of the Southwest would be surprised to hear your geographic descriptions. As would many and most Texans.

          1. Californians and Arizonans do not consider Texas “southwest”. Texas is more “south central”.

            Or just “Texas”, it’s big enough to be its own region – that’s fair.

            1. A guy with a love for Tampa can speak on behalf of all Californians, Arizonans, and overall geographic terms? Fascinating.

              Texas spans a few regions, sure… but it’s always been considered part of the southwest as evidenced by its flagship university naming its band after the state’s association with the Southwest. Do people think of Texarkana, Houston, and Beaumont in the Southwest? Probably not… but then again, no one really thinks of San Francisco or Redding as the Southwest either.

            2. This native Californian has always known that California, Arizona, New Mexico, and Texas are referred to as the “Southwest.” The first short-lived Southwest Airways (1930’s) was based in Texas. The second Southwest Airways (1940’s-50’s) was based in California. The college athletic conference based in Texas was known as the Southwest Conference. Most airline scheduling software I have used group CA, AZ, NM, & TX together as the Southwest.

              This nation started on the East Coast, so many of our geographic references are from an East Coast perspective, thus Ohio is in the Midwest, Minnesota is in the Northwest, and Texas is in the Southwest.

              I can even remember when the Atlanta Braves and the Atlanta Falcons were grouped in the “West” division of their respective leagues.

        2. Not to mention Delta, which isn’t exactly confined to the Mississippi River Delta (its namesake) anymore. And going beyond the US, Queensland and Northern Territory Air Service (QANTAS) hasn’t changed its regional name either.

    2. Also FWIW, the Seattle area has a fair bit of support services for Alaska here. Want to put something on a barge to Alaska? It goes to Seattle. Alaska fishing ship companies? Based in Seattle. Part of what helped Seattle grow was the Alaska gold rush, as people would come here and buy supplies before heading to Alaska. (There was a perhaps apocryphal story of a guy in Alaska who sold sled dogs to prospectors, as the dogs sailed on the ship out of the harbor, he’d blow a whistle, those dogs would jump the ship and swim back to shore…. to be “sold” again!)

  2. WN new schedule come out in a few days. I can definitely see them defending SAN.
    They already added EUG-SAN on Saturday only.
    With AS coming in 7 days a week WN will probably make it daily as well. I wouldn’t be surprised to see SAN-TPA either.

  3. Alaska’s strategy in SFO is dumbfounding. They have essentially flushed away all their investment in Virgin America, having gotten rid of all their planes, and now seem to have given up any intention of making SFO a true hub. Most of AS’s non-Pacific Northwest routes are long-haul turnarounds where the aircraft flies one roundtrip a day. There is little connecting feed in SFO from the rest of AS’s system.

    That’s not to say there isn’t some value in such a route structure for a thoughtfully devised system. SFO is a big enough originating market that well chosen long, thin routes can work. But it seems they could have done that without wasting all that money on Virgin America.

    Perhaps they didn’t get the memo: “You don’t want to be #2 in your hub city.”

    1. I’d be curious to see some comparisons between what Alaska kept from the Virgin acquisition and what Southwest kept from the AirTran acquisition. AirTran used to have a solid hub in ATL, not sure when Southwest really started picking that part.

    2. At some point in the process, Alaska’s strategy with Virgin America went from “hey, pick up a cheap way to expand at SFO” to “keep JetBlue from winning it.” They definitely paid too much.

      1. I’m not qualified to judge if they overpaid (as you say, the real question is would AS be better off now with B6 added to the mix of strongish west coast airlines? I kind of doubt it), but as Cranky shows, they actually have more or less maintained VX’s volume at SFO (modulo pandemic). The network does look different with less focus on vanity routes, and AS will flow most connections over SEA whereas VX had no choice but to flow whatever connections it had over SFO.

        1. And AS is flowing connections over SEA to defend their hub there from attacks by DL. (And if they don’t keep their flight counts up in SEA, they’ll lose gates due to how gates are assigned there.) This has been especially acute as they’ve pulled down the A320 and Q400 fleets, which has required them to circle the wagons at SEA, to the detriment of other major service points like PDX.

    3. They did overpay for Virgin, but at this point it’s a sunk cost. SFO is still big, but there’s no point in keeping it as big as before if the excess flights from SFO aren’t making money.

      Being #1 just for the sake of being #1 is pointless. United has so many long-haul international flights to Asia, Europe, and Australia that both allow for and need those domestic connections and there’s no way or need for Alaska to ‘beat’ that.

    4. Did Virgin make much of an attempt to make SFO a connecting hub? I don’t think they did. Neither VX nor VX+AS really have the volume to operate a true connecting hub at SFO; with as few flights as they do, it’s very hard to schedule banks of connections that work. Also, they don’t have the excess capacity that would really need connections to fill planes. (AS is roughly five times larger at SEA than SFO.) That’s why gunning mostly for the local market at SFO seems like their best option. Really, SFO is a large (for AS) focus city, focused on O/D traffic much more than connections.

      VX was #2 in their hub. AS is very much not #2 in their hub (SEA). I hadn’t checked recently, but I see that AS is more than double DL in SEA. In fact, DL has 75% of AS’s capacity out of SFO: even though I at least think of SEA as the place where AS and DL have head-to-head hubs, AS and DL are actually much closer to each other in SFO.

      1. I literally don’t know a connection i’d make out of SFO on AS. They’re worthless at SFO unless you get yourself to your destination.

  4. It’s worth noting that ALK is returning to its pre merger levels of profitability. While some might not like their network moves, they are doing what is necessary to be sustainable and attractive to their owners ie the shareholders

    1. Oliver – Presumably. But it clearly hasn’t done as well as Alaska has hoped, so it has not put much into it.

  5. From a corporation stand point, Alaska airlines is still an Alaskan corporation. Horizon air is a Washington corporation. Alaska Air Group, the holding company that owner AS and QX,is a Delaware corporation headquarters in Seattle. As to why AS is still called that it fits who they are, just like Southwest and Delta have become much more than they originally were but keep the name.

    1. I doubt it. Other at SFO were always vying for crumbs that United left behind. There’s a reason why Virgin sold itself—it couldn’t make any money with the hub strategy. LAX is just too large with all the major airlines vying for a share. At least Alaska had some intra-westcoast feed to add to what part of the Virgin network it could use. Jetblue had none of that.

      1. The best thing to happen to Virgin America was getting into a bidding war between Alaska and JetBlue.

        One of my favorite Cranky images is the one of a Virgin America plane shredding money.

  6. What do the California hubs look like when the AA codeshares are included? American has a substantial presence in LAX and SFO, if the code share is extensive then Alaska’s position could be stronger than it appears.

    1. Eric C – There is no codeshare out of SF, but it doesn’t really add much from LA anyway. The codeshare is meant more for connecting travelers and not for locals, so it’s just a different dynamic. But if you’re curious, these cities have 1x daily on codeshare: ASE/ATL/BNA/EGE/HND/IAH/IND/JAC/OMA/RDU/SLC/STL/SYD/TUL/XNA/YVR. These have 2x daily on codeshare: ABQ/DEN/ELP/OKC/SAT/SMF/TUS. And AUS has 3x daily.

  7. With the EMB175 on more routes and longer routes, I’m always surprised there are no outlets or an occasional up-gage (probably pilot/staffing issue/frequency trade-off).

    With intra California flights, you pay a premium on Alaska but the experience is pretty much the same/worse than Southwest, United. Makes you miss the Virgin intra-California flights.

    1. I wasn’t sure what the limitation on the E175 for getting power, if its was weight or if its the aircraft’s electrical system capacity, but I went and looked at DL and UA, and they both have in seat power, so it is definitely possible, and a big miss on AS’s part.

  8. What’s even more puzzling is there a retreat from the Sacramento market where they used to have flights to Maui which were always full. They abandoned this market one Southwest started flying to Maui but now Southwest abandoned that route as well. If there’s any airport that needs more flights by Alaska it would be Sacramento the connections are very poor however it looks like their positioning San Diego as another hub like Seattle. Alaska Airlines has no flights from Sacramento to San Francisco or Los Angeles.

    Now that Southwest has stop flying to Maui from Sacramento I’m hoping Alaska reinstates their route that they had operated for many years.

  9. It might be useful to remember that airline managements have a whole lot of data on consumer trends. None of us has access to that kind of quantity or quality of data. Airlines. like other businesses, have a fiduciary responsibility to their employees and shareholders to meet their financial obligations and maximize profitability. The exceptions are places such as Italy and Argentina – the homes of “The Worst Airline in the World” and probably a close runner up.

  10. A SAN focus makes total sense with joining OneWorld. A loyalty-focused traveler there that doesn’t like Southwest can pick Alaska for the nonstops and AA for the connections elsewhere thru PHX or DFW.

    1. I agree with your sentiment completely. wonder if AS would start a SAN-LAX feeder flight to further harmonize the oneworld network. AA stopped that route when compass filed for chapter 7 during the pandemic. AA or AS could always start that route again via skywest but I suspect the regional pilot shortage makes this hard to justify. UA and DL still fly it albeit at a very low frequency compared to pre pandemic.

      1. Fun Fact… I was wondering what would SAN-LAX offer from a OW one stop perspective that LHR & NRT don’t… Those two cover most everything for OW one stop except Australia (for a reasonable traveler), but i went to and there actually isn’t incremental value for SAN-LAX for most of Oz. Qantas is happy to connect you on AS via HNL. They’ll also do it on United on LAX-SAN, but the HNL one was fun for me. I’d take an HNL connection any day over LAX.

        1. Yea it breaks the flight up roughly 1/2 way through. You also have Cathay Pacific at LAX for what its worth. They will probably bring SAN-LAX back once the pilot shortage alleviates and China fully opens up travel. 2024 will probably be for Asia what 2021 was for Europe. I wonder if AA would consider setting up transpacific ops at PHX. Also once T9 gets built at LAX what happens to all the American Eagle gates they had out there? United and star alliance have full rights to the new terminal so maybe American can scoot closer to AS in T5/T6?

          1. But you can get SAN-HKG one-stop via NRT anyway, so you don’t gain any one-stop destinations by adding the SAN-LAX flight.

      2. I don’t think AS is in the business of operating flights entirely to feed AA on a route with essentially zero local market (I imagine). They are certainly in the business of complementing AA, where feed to/from AA can push a route over the top, but if AA doesn’t see fit to operate SAN-LAX for their own brand to feed their hub at LAX, why would it make sense for AS?

        Feeding long haul flights with otherwise money-losing short flights can be bumped into profitability if it gets you a few extra long haul passengers (especially long haul business class passengers), but AS wouldn’t see the high revenue from the long haul segment.

  11. Curious to see how the WN vs AS battle goes at SAN. I suspect things will get interesting when those two are vying for space in the upcoming T1 expansion. I wonder if AS will upguage any of their existing E175 routes (particularly SAN-SFO, SAN-SMF or SAN-SJC) to mainline to better compete when business travel improves. I also feel like the scheduling meltdown at WN this holiday has definitely changed some perceptions about the carriers reliability there are a lot of California based business travelers up for the taking. AS could completely dominate at SAN if they play their cards right. Also noteworthy that they have oneworld connecting flights in both SAN-NRT and SAN-LHR.

  12. Does AS joining oneworld give them a bit less reason to focus on LAX? To the extent they’re feeding oneworld connections, they can do a ton more in SEA, and their customers have plenty of other options while staying in the family at LAX. Given that, SAN seems more complementary to the oneworld network.

  13. Really enjoy flying on the E175s out of SAN, as there are no middle seats. I wish AS success but not too much success to where 737s replace them. The A220 would be a nice add to match Delta but I doubt they would add another aircraft type.

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