Archive for the 'Horizon' Category

Horizon Q400 in Alaska Colors

Published
by
Dan Webb
on February 21, 2011
in Alaska and Horizon
. 0 Comments

After an announcement in January about Horizon adopting Alaska’s brand, a Q400 registered N441QX has been painted with the new Horizon livery. Fortunately, aviation photographer Russell Hill was able snap a couple of great photos of the aircraft at Portland (PDX) this weekend.

I have to say – I really like how the new paint scheme looks. And while it is a little bit sad to see the Horizon retire its brand, the fact that the Horizon name gets such prominent placement on the fuselage is very rare among US-based regional airlines.

Thanks to Russell for letting me post his photos – you can find more of his aviation photography on his Flickr page.

Horizon Air Dropping its Own Brand, Remaining CRJ-700s Leaving This Year

Published
by
Dan Webb
on January 25, 2011
in Alaska and Horizon
. 4 Comments

Alaska Air Group, parent of Alaska Airlines and Horizon Air, reported fourth quarter earnings of $1.28/share (excluding special items), exceeding a mean analyst estimate of $1.02/share, according to the company.

A major part of today’s earnings news is some changes at Horizon Air that the company’s management has been hinting at over the past few months. One of the most recognizable is Horizon adopting the mainline Alaska brand. Horzion still gets a decent shout-out on the side, but obviously the Eskimo is instantly associated with Alaska:

Photo Credit: Alaska Airlines.

We’ll see the first Q400 in this color scheme in a few weeks, and Horizon also says there might be some newly-delivered Q400s that fly without a livery as Horizon schedules painting.

While I’m sure this move is very disappointing for many Horizon employees, it makes sense. Over the years Horizon has become less and less independent of Alaska. Having all of Horizon’s flying fall under a capacity purchase agreement beginning this year was, I think, the final step that made Horizon like most other regional carriers. Considering that tickets are booked through Alaska, I think this is logical from a brand consistency sense. At least some of the unique features of Horizon, like free beer, will be sticking around.

Another interesting change at Horizon is that the CRJ-700s will be going away for good this year. That’s not entirely shocking because it’s been planned to eventually eliminate that fleet, but now we have a more specific timeline to play with.

Back in 2010, Horizon said in an SEC filing that it had “entered into an agreement to dispose of eight CRJ-700 aircraft in the first half of 2011 through either sublease or lease assignment to a third-party carrier.”

Now, in an investor update filed today, Horizon says that it will remove all thirteen CRJ-700s this year, four of which will be removed this quarter. ”These aircraft will be either be, leased, subleased, or assigned to a third party,” says Horizon.

Worthy of note is that previously Horizon had said it had “accelerated the delivery of the eight remaining Q400 aircraft on order to 2011 to coincide with the anticipated exit dates of the CRJ-700 aircraft.” That would keep the fleet at the same size in terms of numbers of aircraft with the previously CRJ retirements, but with the changes announced today the Horizon fleet will actually shrink slightly this year.

Anyway, interesting stuff at Horizon going on. Alaska also made some news today with an order for 13 737-900ERs, and I’ll be getting to that later.

Horizon Changes Course

Published
by
Dan Webb
on August 24, 2010
in Horizon
. 4 Comments

When Alaska Air Group was discussing its earnings last month, Glenn Johnson, the newly-appointed president of regional carrier Horizon Air, shared his vision for the airline to help it reach its goal of a 10% return on invested capital (ROIC).

It appears that Johnson isn’t wasting any time on making some of the moves he mentioned during the call.

For one, Horizon has decided to outsource all of its heavy maintenance on the Q400 fleet, a move that is expected to save $3 million per year. Now, a carrier outsourcing maintenance is nothing new, but it shows Horizon management means business. (On the bright side, none of the 109 workers affected by the move were laid off and instead took an early retirement package or found employment elsewhere at Horizon or the outsourcing company.)

A bigger move is that Horizon is switching to an all-capacity purchase agreement (CPA) model. CPA flying made up 57% of Horizon’s capacity in July. Under this set-up, Alaska covers all of Horizon’s operating costs (including fuel) and then provides a predetermined profit margin to boot. The rest of Horizon’s network is “brand” flying. Here Horizon is flying at-risk – they keep all the revenues but pay all of their costs, and they’ll get some extra revenue under a pro-rate agreement if someone connects to Alaska mainline.

So why go CPA? It provides Horizon with a much more predictable revenues. I doubt this will change the airline’s route network a whole bunch, since Alaska and Horizon’s route planning functions have already been combined. And financially, this probably won’t change the results of Alaska Air Group in aggregate all that much as it’s just moving some items between Alaska and Horizon.

But going all-CPA makes Horizon more of a traditional regional carrier. And something that would even further that is the future of the Horizon brand name – something that the airline has said publicly is up for debate. Most regional carriers just adopt the branding of the mainline partner – the operator of the flight is only mentioned occasionally.

Meanwhile, Horizon operates in its own colors and has its own special offerings – like free beer and wine.

So it seems that Horizon is headed down the path to be like any other regional carrier – but the brand decision is what really defines the airline’s future. Either way, Horizon will be a regional carrier focused on safe and reliable flights, but its name could become much more hidden from passengers.

Special Liveries from Alaksa and Horizon

Published
by
Dan Webb
on November 18, 2009
in Alaska and Horizon
. 3 Comments

Alaska Airlines and regional subsidiary Horizon Air each had a special livery unveiled yesterday. Due to my obsession with special paint schemes, I naturally had to blog about them. :D

Alaska is a sponsor of Olympic speed skater Apolo Ohno, and as such revealed a specially-painted 737-800, registered N596AS. The Seattle-based carrier is also sponsoring the website followapolo.com, where fans can track Ohno’s Olympic journey.

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Meanwhile, sister airline Horizon unveiled the first (registered N439QX) of two Q400s in a special “Comfortably Greener” livery, which is the airline’s way of touting the environmental benefits of the Q400, such as lower emissions. (Or, to put in in less PR-friendly terms, the Q400 is cheaper to operate compared to other 70-seat RJs, partly because it uses less fuel. So, less emissions is a convenient by-product of cheaper operating costs.)

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Click above to enlarge.

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The second Q400 in this special scheme arrives next month. Horizon is slowly phasing out its CRJ-700 aircraft, and the airline estimates it will be operating a single fleet type by the end of 2013.