Alaska Air Counters Delta Assault With Secret Weapon: Unified Employees

Seattle (TheStreet) -- For Alaska Airlines (ALK), the reality of being under assault by a stronger adversary sank in six days ago, when the carrier reported earnings that beat estimates -- yet watched its shares fall 9% as analysts worried about capacity increases in key markets.

But Delta's (DAL) effort to build a Seattle hub on top of Alaska's Seattle hub is also having a positive impact for the airline, in that it is further uniting Alaska's approximately 10,200 workers, 83% of them unionized.

It has not escaped the workers that Delta is a largely non-union carrier, one that strongly resisted efforts by the International Association of Machinists and the Association of Flight Attendants to organize its workers following the 2008 merger with Northwest. IAM and AFA are the two largest unions at Alaska.

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The employees "know Delta is anti-union," said Tom Higginbotham, president of IAM District Lodge 142. "Their focus is on making Alaska work better than Delta.

"The company is definitely doing everything it can to bring everyone together for what it believes is a war," Higginbotham said. "Our relationship with Alaska over the last five or six years has been very good, and this has strengthened everybody's willingness to cooperate with each other."

The IAM represents about 3,100 employees, including 2,500 agents and 600 ramp and stores workers.

Jeff Peterson, president of the Alaska chapter of the Association of Flight Attendants, said, "Considering Delta is one of our closest code share partners, Delta management isn't playing very nice.

"Many of Delta's flight attendants seem to have the impression that Delta is going to buy us or run us out of business," Peterson said. "That opinion must be coming from their management [but] I can assure you that's not going to happen. Delta does a nice job, we don't begrudge their employees anything, but we're here to stay."

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Alaska has historically scored high in customer satisfaction, which is at least partially a tribute to its flight attendants and agents, the primary contacts for most passengers. In the J.D. Power study of customer satisfaction among traditional carriers in North America, the carrier has scored highest every year since 2009, after tying for highest in 2008.

Alaska also has shown continuing improvement in employee productivity. "Employee productivity as measured by passengers per [full-time employee] continues to be a great story for us," CFO Brandon Pederson said last week, during the carrier's second quarter earnings call.

"The 1.5% increase this quarter marks the 20th consecutive quarter of productivity improvement," Pederson said. "We're now handling 187 passengers for every FTE, a 36% improvement over where we were in 2004."

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