Alaska Airlines to offer basic economy fares

Alaska Airlines will enter the no frills basic economy market later this year.

It will start selling non-exchangeable Saver Fare tickets which are similar to the Basic Economy fares now available with major carriers, American Airlines, United and Delta.

The move is to ‘improve the profitability of the business’ said CFO Brandon Pedersen in an analysts’ call.

Alaska’s basic fares will have assigned seats but ticket holders will be last to board.

The airline will also start charging more for seats in extra rows which generally boast more legroom.

In addition, Alaska will start applying dynamic pricing to its premium seats based on daily demand.

"We plan to roll out a fare segmentation platform in the late fall, which is essentially Alaska’s response to the industry’s basic economy fares, which are now prevalent," CEO Brad Tilden said.

The airline has already addressed the cabin baggage crunch by recently announcing a reduction in size of carry-on bags allowed in overhead bins.

The changes were announced as Alaska’s merger with Virgin America officially completes at midnight Tuesday when all passenger-service systems, websites, apps, and reservations are combined.