Lineage goes back to 1932 as McGee Airways, Alaska Airlines Name used after 1944
Early years (1932–1945)
See also: McGee Airways and Star Air Service
Black-and-white photo showing the left side of a seaplane being carried sideways on a truck.
A Stinson "S" Junior aircraft of McGee Airways. McGee Airways was the precursor to present-day Alaska Airlines.
The airline traces its roots to McGee Airways, which was started by Linious "Mac" McGee in 1932. The airline flew its inaugural service between Anchorage and Bristol Bay with a Stinson single-engined, three-passenger aircraft. At the time, there were no scheduled flights; a flight took place when there were passengers or a load of cargo or mail.
It was the middle of the Great Depression and the airline was struggling financially. There were also too many airlines in Anchorage and not enough demand to support them. In the next few years the airline performed many mergers and acquisitions that produced changes in the name and saw business expand throughout Alaska. The first of these mergers was in 1934, when McGee sold his namesake airline for US$50,000 to Star Air Service, an airline also located in Anchorage. This allowed McGee to enter the mining industry. With a fleet of fifteen aircraft, Star Air Service was a dominant airline in Alaska. But Star continued to struggle financially because of high maintenance costs for its wooden planes.
In 1937, McGee came back to the airline and opened a liquor store, and the airline began flying liquor to remote Alaskan communities. That year, Star Air Service purchased Alaska Interior Airlines and was incorporated as Star Air Lines. Star was again sold later that year to a group of miners.
In 1938, federal regulation began when Congress created the Civil Aeronautics Board (CAB). The CAB awarded the airline most of the routes that it wanted in Alaska, but the coveted route between Seattle and Anchorage was awarded to Pan American Airways.
In 1941, Star Air Service was purchased by Raymond Marshall, a businessman from New York. In 1942, the airline purchased three other airlines in Alaska, Lavery Air Service, Mirow Air Service, and Pollack Flying Service as well as a hangar at the Anchorage airport. That year, the airline's name was changed to Alaska Star Airlines. The name Alaska Airlines was adopted on May 2, 1944 having narrowly beaten a competitor who was also applying for the name. In the 1940s Alaska's headquarters were in Anchorage.
When the US entered World War II in December 1941, Alaska Airlines faced a shortage of pilots. During the war the airline also lacked funds and equipment, and pilots were often forced to buy fuel for their planes out of their own pockets. The company, which was frequently subjected to lawsuits, also went through many different presidents during this time. In 1943, Alaska Airlines purchased the Lockheed Model 18 Lodestar, its first multi-engine aircraft. That same year the company's stock was traded for the very first time on the American Stock Exchange.
Expansion after World War II (1945–1949)
In 1945, Alaska Airlines hired its first stewardesses. In 1947, James Wooten became president of the airline and he began to expand the airline greatly. Under his leadership, the company purchased many surplus military aircraft from the government that were used during World War II. The airline purchased Douglas DC-3s, Douglas DC-4s, and Curtiss-Wright C-46 Commandos. Alaska Airlines was the first carrier certified to operate DC-3s on skis.
The airline used its new aircraft to expand its charter business, and by 1948, it was the world's largest charter carrier. The airline had charter flights from Anchorage to Honolulu, Hawaii as well as a flight to Chicago with a stop in Seattle. Flights on this route were technically not scheduled, but they were flown regularly. However, these flights would later result in a lawsuit in 1948 by competitor Pacific Northern Airlines because of the fact that they were operated on a regularly scheduled basis yet technically non-scheduled charter flights.
Alaska Airlines also flew in other parts of the world, and participated in airlifts such as the Berlin Airlift in Germany and Operation Magic Carpet in the Middle East. In the 1948 Berlin Airlift, the airline flew supplies to Allied West Berlin after the Soviets imposed a blockade on the city. It also contributed to several other airlifts, including evacuating Chinese Nationalist forces during the 1949 Communist Revolution in China.
The carrier played an important role in organizing an airlift of Jews from Yemen to Israel, in Operation Magic Carpet from 1949 to 1950. Alaska Airlines, along with many other airlines, helped fly Jews to Tel Aviv in the newly created country of Israel. This was not an easy task, however. Airplanes could not land in Arab territory, so they had to be fitted with extra fuel tanks in order to fly nonstop between Yemen and Israel. The airplanes also had to fly over hostile territory and were often shot at by Arabs. The airport in Tel Aviv was frequently bombed, so they could not keep aircraft there overnight. Despite this, there were no aircraft destroyed or lives lost.
Alaska Airlines' large charter business made it profitable, and the airline moved its base of operations to Paine Field, an airport north of Seattle. It kept a branch office in Anchorage, however. Despite its success, Alaska Airlines' worldwide charter business was short-lived. In 1949, the CAB tightened its regulations and placed heavy fines on the airline and shut it down completely for safety violations. The airline was prohibited from operating worldwide charter flights, and president James Wooten left the company.
New leadership (1950s)
Alaska Airlines started the 1950s without its worldwide charter business and operations restricted to the state of Alaska. In 1950, it purchased two smaller Alaskan airlines, Collins Air Service and Al Jones Airways.
Though the airline had grown much under the ownership of Raymond Marshall, the CAB forced him out in 1951 due to continuing financial troubles. Also, Marshall had owned Alaska Airlines with the intent of getting money for himself, and he was not concerned about the long-term stability of the company. In 1951, the CAB awarded Alaska Airlines with a temporary certificate allowing them to operate on routes from the Alaskan cities of Anchorage and Fairbanks to Seattle and Portland in the contiguous United States; this award would become permanent in 1957.
In 1952, the CAB appointed Nelson David as president, and he began to improve the financial stability of the airline. By 1957, with the carrier in a better financial situation, David left and Charles Willis, Jr. became the company's new president and CEO. A pilot during WWII, Willis introduced several marketing gimmicks that set the airline apart from other ones of the day. Under his leadership, Alaska Airlines became the first to show inflight movies. The company began service of the Douglas DC-6, the airline's first pressurized plane, enabling flights above clouds and weather disturbances. On these DC-6's, the airline introduced "Golden Nugget" service, which included an on-board saloon and piano.
The jet age (1960s)
In 1961, competitors began introducing jets on routes Alaska Airlines flew. To counter this competition, Willis negotiated with aircraft manufacturer Convair to purchase a jet Convair 880 with no money down for use on routes between Alaska and the contiguous United States. The company introduced the new jet aircraft the same year, and later leased several more of the same type. The carrier later introduced the Boeing 727, and that airplane became Alaska Airlines' signature aircraft for the next 25 years. It also became the first carrier to fly the Lockheed L-100 Hercules, the civil version of the C-130, which hauled oil drilling rigs to Alaska's North Slope and later to Ecuador. Alaska also owned two Lockheed L-1649A Starliners from 1962 to 1968, which were used for Military Air Transport Service operations.
During this time, Alaska Air faced some tough competition with other airlines such as Pan Am, Northwest Airlines and a regional carrier called Pacific Northern Airlines (later merged with Western Airlines). To set itself apart from the competition, it turned to some cheap but imaginative gimmicks such as having safety instructions read as rhymes, fashion shows in the aisles, as well as bingo games.
In December 1962 Air Guinée signed a contract with Alaska Airlines which saw the latter company providing management expertise, in addition to two Douglas DC-6s. The deal would have seen Alaska Airlines contracting with the airline over a seven-year period but the contract ended after only six months, leading to the United States Agency for International Development paying a US$700,000 debt owed by the Guinean airline to Alaska Airlines.
In 1965, Alaska Airlines turned over some routes between small Alaskan communities, as well as some smaller aircraft, to Wien Air Alaska. This allowed Alaska to focus on more heavily traveled routes and allowed them to sell off smaller aircraft.
Throughout the 1960s, Alaska Airlines worked to promote tourism to Alaska by offering charter flights to the continental United States. In an attempt to increase the state's appeal, Alaska Airlines conducted a promotional tour of Japan in 1963. In 1967, as the state of Alaska celebrated its centennial, Alaska Airlines introduced a promotional "Gay Nineties" theme with stewardesses dressed in Edwardian outfits. That year, Alaska Airlines expanded to southeast Alaska with the introduction of service to Sitka. This led to the purchase of two smaller airlines, Alaska Coastal Airlines and Cordova Airlines, in 1968.
Economic hardship (1970s)
Left side view of an aircraft approaching an airport, with its nose pitched down slightly. In the background is blue sky.
A Boeing 727-200Adv on approach to Los Angeles International Airport, showing the new livery and logo introduced in the early-1970s.
In the beginning of the 1970s, Alaska Airlines began charter service to Siberia in the Soviet Union. This was the result of three years of secret negotiations between Alaska Airlines and Soviet authorities, in which the US Department of State reluctantly chose not to block the plan for fear of a potentially negative response from the Soviets. The airline gained permission to fly more than two-dozen flights in 1970, 1971, and 1972.
However, the airline was not in good financial shape at that time. Like much of the airline industry, Alaska Airlines was hit with rising fuel and operating costs and was on the verge of bankruptcy. Revenues were significantly reduced when work on the Trans-Alaska Pipeline System was delayed. The airline's cargo aircraft had played a key role in building the pipeline, but now sat idle. The airline took another blow on September 4, 1971, when a plane crashed on landing in Juneau, killing 111 people and resulting in the worst single-plane crash at the time. Because the airline was struggling financially, the airline's board ousted the president and CEO Charles Willis. Former board member Ronald Cosgrave succeeded him. The airline was US$22 million in debt when Cosgrave took over, so Cosgrave began to make major cuts. The airline's cargo business was dropped completely, as well as many flights and employees. Cosgrave also sought to improve the airline's tarnished image of "Elastic Airlines." The logo was changed to an image of a smiling Eskimo, which remains today. As a result of these efforts, the airline made a profit in 1973 and continued to be profitable thereafter.
Post-deregulation expansion (1978–1990)
Alaska Airlines was one of only three US carriers that supported the 1978 Airline Deregulation Act, knowing that they would reap significant growth and other benefits from deregulation. After deregulation, the company's real-estate division was spun off into its own company, with Cosgrave becoming its chairman. Leadership of the airline was passed to Bruce Kennedy, a close associate of Cosgrave. Cosgrave made an alliance with Alaska Airlines to purchase competitor Wien Air Alaska, but this ultimately failed and resulted in fines for Alaska Air and its leaders for improprieties during the attempted acquisition.
At the time of deregulation, Alaska Airlines served ten cities in Alaska and one in the continental US —the city of Seattle—, and it had only ten planes in its fleet. Immediately after deregulation, the airline began to expand, adding the cities of Portland and San Francisco to its network. Soon later, the airline resumed services to the Alaskan cities Nome and Kotzebue, and it also introduced service to Palm Springs, California. Burbank and Ontario were added in 1981. Other cities in the continental US that were added to the airline's route map by 1985 were Oakland and San Jose in California, Spokane in Washington, Boise in Idaho, and Phoenix and Tucson in Arizona.
Deregulation also brought challenges to the airline, however. The airline was faced with increased competition and inflation that put tremendous pressure on costs, profits, and salaries. There were also tensions with unions, particularly mechanics and flight attendants. In 1985, the company had a three-month-long strike with its machinists. By June the same year, it was able to end the strike by promising to reduce labor costs and maintain peace with unions. In November 1985, the airline introduced a daily air-freight service called Gold Streak with service to and from Alaska.
Right side view of an airplane taxiing on the ground towards left side of image. Another plane is behind it, and in the background are mountains and blue sky with a few clouds.
Alaska Airlines was the launch customer for the MD-83 and operated many of these jets throughout the 1980s and 1990s.
In the 1980s, Alaska Airlines began acquiring McDonnell Douglas MD-80s to replace their aging 727s. Alaska was the launch customer for the MD-83, taking delivery of their first MD-80s in 1985.
Also in 1985, the Alaska Air Group was formed as a holding company for Alaska Airlines. In 1986 Alaska Air Group acquired regional airline Horizon Air, which remained a separate brand from Alaska Airlines; since then, both airlines have been subsidiaries of Alaska Air Group. In 1987, Alaska Airlines purchased Jet America Airlines. Alaska initially operated Jet America as a separate airline, but this proved economically unviable, and Jet America's operations were merged into Alaska's. Alaska also discontinued all flights to the Midwest and the East coast formerly operated by Jet America. Additional MD-80s entered the fleet via the acquisition of Jet America Airlines in 1987.
There was also a big seasonal imbalance in travel to Alaska, which mainly took place in the summer. In an effort to compensate for this, the airline introduced service to Mexican resorts, where most travel takes place in the winter. In 1988, the airline began servicing the Mexican resort cities of Mazatlan and Puerto Vallarta. By the end of the 1980s, 70 percent of Alaska Airlines' passengers flew south of Seattle and the airline served 30 cities in six states outside Alaska. The airline had successfully used the state of Alaska as a springboard to expand into larger, more profitable markets.
New competition, new technologies (1990s)
The airline began the 1990s with plans to lease 24 Boeing 737–400s from International Lease Finance Corporation (ILFC), all of which remain in Alaska's fleet to this day. The first aircraft was delivered in April 1992.
In 1991, Alaska Airlines added several routes. In the Russian Far East, it added the cities of Magadan and Khabarovsk, as well as service to Toronto, its first Canadian city and the first city east of the Rocky Mountains. However, Toronto was later dropped, in 1992.
As the airline marked its 19th consecutive year of profits in a turbulent industry and racked up many awards for customer service, Bruce Kennedy retired in May 1991 and was succeeded by Raymond J. Vecci.
Alaska Airlines also faced increased competition from low-cost carriers. One carrier that competed with Alaska was MarkAir. Since it began operating in 1984, competition had been reduced because it had worked out feeder agreements with Alaska Airlines. However, after Alaska Air declined to buy the airline in the fall of 1991, it intensified competition with Alaska. The airline offered low-cost service on the Anchorage-Seattle route and other routes in Alaska, where Alaska Airlines earned almost one-third of its revenues. This hurt Alaska Airlines; for the first time in 20 years, it posted a loss of US$121 million. To save money, the airline canceled two proposed maintenance facilities and deferred a large aircraft purchase worth US$2 billion. It was able to increase utilization on its existing planes, though. The airline also cut labor costs, but this ended up making relations with unions tense.
The cost reductions produced quick results. In 1993, their losses decreased to US$45 million, and they made a US$40 million profit the next year. Eight percent of these revenues were generated by record-setting cargo operations.
Alaska had more competition in 1993 when low-cost airline Southwest Airlines entered the Pacific Northwest by purchasing Morris Air. Nevertheless, Alaska Airlines was able to keep its costs down, but it maintained its high level of customer service. The airline also promoted itself as "the last great airline" and with the motto "For the same price, you just get more", yet analysts felt that Alaska Air needed deeper cost cuts. At the same time, the company had many strikes by the flight attendants' union.
Alaska continued to take delivery of new MD-83s during the 1990s, both to meet the demands of a growing route system, and to replace its aging and fuel inefficient 727 fleet. Meanwhile, the airline phased out its 727s, retiring their last one in March 1994. The airline's MD-80 fleet peaked at 44 aircraft in 1996.
Vecci was dismissed in 1995 and replaced with John Kelly, former Horizon Air CEO. The airline soon expanded West Coast routes to take advantage of an "open skies" agreement between the US and Canada.
Alaska Airlines also pioneered some new technologies through the 1990s. It added a head-up guidance system in 1989 to operate better in foggy conditions, becoming the first airline to use this technology. In 1995, the airline became the first to sell tickets on the Internet. By 2000, all the airline's planes carried automated external defibrillators, for use in in-flight emergencies. The airline also installed self-service kiosks called "Instant Travel Machines" that printed boarding passes, allowing customers to bypass the traditional ticket counter. An X-ray device, an addition to the unit allowing passengers to check their own baggage was being tested in 1999 at Anchorage. This concept, known as "Airport of the Future" by the airline, was first tested in Anchorage and was later brought to its Seattle hub, and it drew attention from other airlines as well. The airline would also become the first airline in the world to integrate GPS and Enhanced Ground Proximity Warning System (EGPWS) technology, adding a real-time, three-dimensional display of terrain. The system was operational in all the carrier's Boeing 737-400s by April 1999.
The late 1990s also saw the carrier recording much profitability. The airline added new training and maintenance facilities. Also, the airline began buying new 737s, ordering three Boeing 737–700s and ten Boeing 737–900s. Alaska Airlines became the launch customer for the 737–900 when it placed an order for it in November 1997.