Alaska Airlines is buying out most of the Alaska Thunder, Alaska Air, and Alaska Air Cargo airplanes in the U.S. in a deal that is expected to be completed next month, a move that is likely to lead to the loss of about 2,500 jobs in the state.
The deal, announced Tuesday by Alaska Airlines CEO Michael Horn, will take effect Dec. 1, according to a release from Alaska Airlines.
The purchase price for the Thunder, the most popular of the fleet, is $4.8 billion.
The Alaska Thunder is the last Boeing 747 in Alaska, which is owned by Alaska Airways.
Alaska Air currently operates more than 7,600 Boeing 747-400s and 737 MAX jets, but has been trying to sell off some of its 737 MAXs in recent years.
Horn told CNBC earlier this month that the deal is expected for completion in December, with the Thunder and the Alaska Air fleet to remain in service until 2020.
The announcement comes amid the ongoing Russian aggression in Eastern Europe, with Moscow ordering the air defenses of several NATO member nations to be upgraded to a level more acceptable to the Kremlin.
“We are committed to the safety and security of our airline passengers, crew, and cargo as well as the security of the air space surrounding our air terminals,” Horn said in a statement.
“This is an important step towards the completion of this important agreement.”
Horn said the new contract will allow Alaska to keep the planes, which were originally manufactured in the 1970s, in Alaska for the next 20 years.
Alaska has a total of about 1,600 747-8s, and Horn said that the Thunder would not be phased out.
Alaska, however, has been unable to sell the planes due to a combination of low demand and poor production.
Horn said this week that Alaska will “probably be able to sell these aircraft in 20 years” if it can find a buyer.
Alaska Airlines, the nation’s third-largest carrier, said the Thunder was a “once in a lifetime” opportunity to buy Alaska.
“Our new aircraft is an asset to Alaska, and our aircraft family has been built and operated by Alaska for many decades,” Horn told reporters.
“The Thunder will be a part of the long-term future of our Alaska operations.”
Horn added that Alaska was still trying to decide whether or not to continue the Alaska 737 MAX line of aircraft, which was the only aircraft that the company sold to Russia after the breakup of the Soviet Union.
“I am confident that we will be able and will be successful in our decision to continue with our 737 MAX aircraft as an asset for our operations in the future,” Horn added.