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Alaska Airlines to receive $100 million in aid

Posted: Monday, September 24, 2001

ANCHORAGE Alaska Airlines and its sister carrier, Horizon, are in line to get about $100 million under a federal aid package for airlines.

The $15 billion measure approved by Congress on Friday calls for $5 billion in cash aid and $10 billion in loan guarantees for the industry.

The aid formula is based on the number of passenger miles airlines flew in August, according to Jack Walsh, a spokesman for Alaska Airlines. Alaska and Horizon, both owned by Alaska Air Group, represent about 2 percent of the industry's total.

Alaska Airlines is losing in excess of a million dollars a day currently, Walsh said, after suffering about $8 million in losses in the two days the airline was shut down following the Sept. 11 terrorist attacks.

The Seattle-based carrier is running about 75 percent of its flights and they're only about half-full, Walsh said. Normally, about 70 percent of the seats are filled.

The airline has had a number of cancellations, and bookings at the Alaska Air reservation center are running at about half the normal rate, he said.

With the huge cost of a jet plane, it's expensive for them to sit on the ground. Most of an airline's costs are fixed and keep piling up even when planes aren't flying, Walsh noted.

But while other carriers are letting thousands of workers go, "right now layoffs would only be a last resort" for Alaska Airlines, Walsh said.

The carrier ran virtually all of its flights in Alaska last week, but only about 75 percent of its normal operations across the system.

The airline planned to ramp up to about 85 percent this week. Horizon, which flies smaller planes on shorter routes in the Pacific Northwest, is planning a fall schedule that's about 75 percent of normal.

Alaska Airlines has a strong cash position, unlike most of its competitors, and has only a single flight to the East Coast. That flight, however, is supposed to go to Reagan National Airport, which has been closed indefinitely.

"Right now," Walsh said, "a lot depends on passenger confidence in the safety of the airways. That will depend on what the government does in the coming days."



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