Alaska Air layoffs: Airline to slash 200 jobs as soaring oil prices squeezes earnings : Report

Alaska Air layoffs: Alaska Air Group has said it would eliminate close to 200 non-contract positions as soaring fuel prices and geopolitical challenges squeeze its finances, with its chief executive warning of a potential USD 700 million annual loss.

The cuts suggest that the effects of airlines' fuel-price shock are extending beyond higher fares and reduced flight schedules, to threaten airline jobs, Reuters reported.

Mounting financial pressure on Alaska Air; what CEO Minicucci told employees in memo?

They also highlight mounting financial pressure on Alaska Air ⁠as it pursues an ambitious expansion into premium and international travel, with strong revenue growth struggling to offset rising fuel costs, the Reuters report added.

Chief Executive Ben Minicucci told employees in a memo seen by Reuters that the company could lose as much as USD 700 million this year if current conditions persist, marking its first adjusted pretax loss outside the pandemic since 2003.

"We must return to the financial discipline that has long been a key competitive advantage," Minicucci said, adding that overhead expenses had "grown at a disproportionate rate to revenue" over the past few years.

Reductions affect less than 1% of Alaska's 32,500 employees

The reductions affect less than 1 per cent of Alaska's roughly 32,500 employees, a company spokesperson told Reuters. They include 125 positions in Washington state and 48 ‌in Hawaii.

No ⁠frontline, non-management jobs are being eliminated. Affected employees will have their last working day on November 13 but will continue receiving pay through December 31, along with severance and other support, according to the memo as cited by Reuters.

US airfares jumped average of nearly 23% YoY in 7 months

US airfares rose an average of nearly 23 per cent year-on-year in the seven months through September, according to Labour Department data, but Delta Air ⁠Lines, American Airlines and Southwest Airlines have still cut their 2026 earnings forecasts.

Alaska Air last week forecast a full-year adjusted loss of USD 5 to USD 5.50 per share, citing USD 1.8 billion in additional fuel costs compared with its original annual plan.

The carrier expects fourth-quarter fuel costs ⁠of USD 4.65 to USD 4.85 per gallon, nearly double the USD 2.50 assumed in its initial 2026 plan.

It reported a 14 per cent year-on-year increase in third-quarter revenue, but its adjusted pretax margin declined to 1.1 per cent from 4.6 per cent a year earlier.

The Seattle-based carrier is ⁠investing in premium cabins, loyalty programs and international routes following its acquisition of Hawaiian Airlines, and plans to expand its long-haul network from Seattle, the Reuters report added.

Minicucci said Alaska would continue investing in its fleet, customer experience and network even as it tightened spending.

(With inputs from Reuters)