CHICAGO: Alaska Air Group will eliminate about 200 non-contract positions as soaring fuel costs and geopolitical uncertainty strain its finances, with CEO Ben Minicucci warning that the airline could lose as much as $700 million this year.
The cuts highlight how the fuel-price shock linked to the Iran war is affecting the U.S. airline industry, forcing carriers to raise fares, scale back flight growth and reconsider staffing levels.
In a memo to employees reviewed by Reuters, Minicucci said the company needed to restore financial discipline, adding that overhead expenses had grown faster than revenue in recent years.
"We must return to the financial discipline that has long been a key competitive advantage," he said.
The reductions will affect less than 1% of Alaska Air's approximately 32,500 employees, including 125 positions in Washington state and 48 in Hawaii, a company spokesperson said.
No frontline, non-management positions will be eliminated. Affected employees will have their final working day on Nov. 13 but will continue receiving pay through Dec. 31, along with severance and other support, according to the memo.
If current conditions persist, the projected $700 million loss would mark the airline's first adjusted pretax loss outside the pandemic period since 2003, Minicucci said.
Last week, Alaska Air forecast a full-year adjusted loss of $5 to $5.50 per share, citing $1.8 billion in additional fuel expenses compared with its original annual plan.
Higher ticket prices have offered limited relief across the industry. U.S. airfares rose nearly 23% year over year in the seven months through September, according to Labor Department data. However, Delta Air Lines, American Airlines and Southwest Airlines have also lowered their 2026 earnings forecasts.
