Anchorage Daily News

Alaska Air Group Inc.'s mounting financial losses due to escalating fuel prices will prompt layoffs of about 80 managers and a unspecified reduction in flights in the coming months, the company announced Thursday.

Most of the layoffs will occur at the airline's headquarters in Seattle. A company official on Thursday couldn't say whether any Alaska flights -- or employees -- will be cut.

The airline will start announcing layoffs in mid-August, and expects to share its plans for flight reductions in early September, said Caroline Boren, a company spokeswoman.

She said Alaska plans to reduce its flights 5 percent by the end of the fiscal year, and an additional 5 percent by the end of 2009. But the airline hasn't made any decisions yet on where those cuts in service will be made.

"We're looking (nationally) across our schedule," she said. "In many markets, there may be a way to reduce by a flight or two."

"In Alaska, our commitment remains as strong as ever to maintain an appropriate level of service," she said.

The flight reductions will result in additional layoffs of operational employees, which will also be announced in early September, she said.

The airline said Thursday that it had a $63.1 million profit during the quarter that ended June 30. That was up from $46.1 million during the corresponding period last year.

But excluding cost adjustments made for its fuel contracts and the company's fleet transition, Alaska actually lost $14.1 million, or 39 cents per share, in its second quarter, which ended June 30.

"Skyrocketing fuel prices have eclipsed the improvements we've worked so hard to achieve in every area of our business," said Bill Ayer, Alaska Air chairman and chief executive officer, in a press release

"Decisive action, an excellent operation, and the genuine, caring service our employees provide will help us survive what is shaping up to be the most difficult period in commercial aviation history."

Find Elizabeth Bluemink online at adn.com/contact/ebluemink or call 257-4317. The Associated Press contributed to this report.

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