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Think Your Bags Are Safe on Alaska? Think Again!

Think Your Bags Are Safe on Alaska? Think Again!

Alaska posted positive third-quarter results, but saw a significant increase in mishandled bags in August 2015.

Alaska Airlines reported a large uptick in mishandled baggage reports in August 2015, up 57.6 percent year-over-year. Meanwhile, the Seattle-based carrier reported third-quarter earnings growth and said it expects fourth-quarter capacity to grow by 12.5 percent.

“We had a rough quarter on mishandled bags and the operations folks own that,” Chief Operating Officer Ben Minicucci said in a conference call with investors last week. “We’re not happy with how we performed. We actually have an initiative right now and going into 2016 to get our mishandled bags right in line.”

Alaska reported that for August 2015 the airline collected 9,947 incidents of baggage reports from 2.1 million flyers, or 4.65 incidents per 1,000 passengers, up 57.6 percent from 2.95 reports per 1,000 passengers, or 5,747 incidents from 2 million travelers, in the year-ago period.

The Department of Transportation (DOT) collects airline data for each month to calculate the rate of mishandled baggage. The rate is based on the total number of reports each carrier received from passengers concerning lost, damaged, delayed or pilfered baggage.

According to the Air Travel Consumer Report published this month by the DOT, only Envoy Air and ExpressJet Airlines reported more mishandled baggage reports. Envoy Air said it took 7.05 baggage reports per 1,000 passengers in August 2015 with 7,074 reports from 1 million flyers. ExpressJet received 10,535 reports from 2.1 million passengers, or 4.93 per 1,000 passengers in August 2015. Though both topped the list of most mishandled bags, Envoy’s and ExpressJet’s rate per 1000 passengers fell 34.8 percent and 12.3 percent respectively year-over-year.

On Thursday, Alaska reported third-quarter 2015 GAAP net income of $274 million, or $2.14 per diluted share, up 38.4 percent from to $198 million, or $1.45 per diluted share in 2014’s third quarter.

Excluding the impact of mark-to-market fuel hedge adjustments of $5 million ($3 million after tax, or $0.02 per diluted share), Alaska posted adjusted net income of $277 million, or $2.16 per diluted share, up 38.5 percent from adjusted net income of $200 million, or $1.47 per diluted share in 2014.

“This was the busiest summer in our 83 year history and represents our highest quarterly profit ever,” said Alaska Chief Executive Officer Brad Tilden in a press release. “I want to thank our employees who are building a fundamentally strong business and our customers for their incredible loyalty and support.”

Alaska expects fourth-quarter capacity to rise 12.5 percent.

“About half of that growth is driven by longer stage and larger gauge, another 2 points by new markets with the remaining 4.5 points being additions to existing markets where there continues to be strong demand,” said Chief Commercial Officer Andrew Harrison on the call. “This brings our full-year capacity growth to just over 10 percent and in line with previous guidance.”

[Photo: iStock]

 

View Comments (2)

2 Comments

  1. Crzn33k

    October 26, 2015 at 10:07 am

    This article makes it sound like bags are being stolen or items taken out.
    Many bags from other airlines don’t make the flight or caught up with the TSA.
    It’s too bad that they can’t report that.

  2. WChou

    October 27, 2015 at 10:40 am

    I am guessing the outsourcing of ramp operations may be part of the issues. AS has gone with the lowest bidder and it is beginning to show. Menzies is awful. Low pay and minimal staff means mediocre people are pushed beyond their abilities. As a passenger, I will never check a bag on AS after seeing how their contractors handle luggage. People’s belongings are flung around, dropped, and generally treated poorly. All this in full view of the public, I can’t imagine what the airport bag room is like.

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