Alaska's New Flights Put Its Relationship With American to the Test

(MoneyWatch)  In February, I began wondering if there were chinks in the Alaska/American relationship when American (AMR) announced it would put regional jets on LA to Reno, competing head to head with its partner. I think we're about to find out just how strong that relationship really is these days. Alaska's (ALK) regional partner Horizon will be starting flights on an American route, Los Angeles to San Jose. How will American respond?

Alaska's announcement was buried under a lot of Hawai'i and Mexico flying changes, but I find this to be a far bigger deal. Starting on August 23, Horizon will start four daily flights between Los Angeles and San Jose. Southwest rules this market, but United and American are both in it. Sounds pretty crowded, right? But for American, this will be a test.

According to the release,

The new service is timed for convenient connections to domestic and international destinations on Alaska Airlines' alliance partners Air France, Air Pacific, American Airlines, British Airways, Cathay Pacific, Delta Air Lines, KLM, Korean Air, LAN and Qantas.

Hmm, really? This can go one of two ways. It's possible that American has been looking to drop this route, one of the vestiges of its old San Jose hub that it acquired in its Reno Air purchase. If that happens, then they'll be able to funnel their connecting customers on to the Horizon flight and everyone will be happy.

On the other hand, we may see American take this as a challenge, and they may very well keep flying the route, hoping Alaska loses out. If that happens, then it's pretty clear to me that the relationship is in serious decline. Keep an eye on that route for American. Come August 23, if we see their planes flying head-to-head, my guess is that the end of the relationship is just a matter of time. . . unless, of course, American decides to try to buy Alaska. But that's a whole different story.