Alaska Airlines plans job cuts, closes facility

By Allison Linn
Associated Press

SEATTLE — Alaska Airlines is cutting nearly 900 jobs and will close its Oakland, Calif., maintenance facility as part of efforts to become more competitive against low-cost carriers and save up to $35 million annually.

The nation's ninth-largest carrier, which employs more than 11,000 employees, said last month that it was cutting up to 150 management positions. Yesterday it announced plans to shed another 750 jobs.

The cuts mark the airline's first major layoffs since the Sept. 11 terrorist attacks.

In an interview with The Associated Press, Alaska Airlines chief executive Bill Ayer said the moves were prompted by a number of factors in addition to increasing competitive threats from low-cost airlines, including high fuel prices and customer demand for cheap tickets.

"The environment itself is very, very harsh," he said.

Seattle-based Alaska has the fourth-highest costs of any U.S. airline, and Ayer said those costs must come down if the company is to survive in the long term.

The cuts include 340 jobs at the Oakland maintenance base that closed yesterday. From now on, the company said all heavy maintenance work on aircraft will be done by Goodrich Aviation Technical Services in Everett, Wash., and AAR Aircraft Services in Oklahoma City.

The company also will close some facilities maintenance and ground support operations, resulting in another 60 job cuts. And it is cutting 273 jobs in Seattle and various cities in Alaska because it will begin using contractors to clean airplanes between flights in those cities.

Alaska said it plans to find ways for employees at Alaska Airlines and its sister airline, Horizon Air, to share more work, resulting in some of the Alaska Airlines cuts.

Horizon also will cut about 30 of its 3,400 jobs as part of that move.

Alaska Airlines will farm out some customer service work in the state of Alaska and close ticket offices in Juneau, Anchorage and Bellevue, Wash., among other changes.

Ayer said the company does not yet know how much the layoffs will cost, or when it may take a charge for the changes. He also couldn't say whether more layoffs might be ahead.

But in a memo to employees, Ayer wrote that the changes were necessary to prevent harsher woes in the future.

"The airline industry is full of examples of inaction, with an eventual devastating toll on huge numbers of employees," he wrote. "We must make changes now to avoid those types of drastic actions later."

Alaska Airlines and Horizon Air are subsidiaries of Alaska Air Group Inc.