Horizon Air is an American regional airline headquartered in SeaTac, Washington, United States, within the Seattle metropolitan area. It is a wholly owned subsidiary of the Alaska Air Group, and it is paid by fellow group member Alaska Airlines to staff, operate, and maintain aircraft used on flights that are scheduled, marketed, and sold by Alaska Airlines. Planes operated by Horizon are co-branded as Alaska Horizon to differentiate Horizon's planes from those operated by Alaska's other regional airline partner, SkyWest Airlines.
Horizon Air started operations in September 1981, was purchased by the Alaska Air Group in November 1986, and continued to fly as a separately branded airline until 2011, when it shifted to the current capacity purchase agreement business model.
The airline is headquartered in the Seattle suburb of SeaTac, not far from Seattle–Tacoma International Airport, and the airline's primary maintenance base is at Portland International Airport. Horizon also considers Seattle–Tacoma and Portland airports its hubs.
Horizon Air was formed in May 1981 by Milt Kuolt, Joe Clark, and Bruce McCaw, with initial plans to fly to Hawaii but later changed to serve Washington state. The airline started operations on September 1, 1981, with three Fairchild F-27 aircraft. Its headquarters were in an area that is now within SeaTac, Washington.
Horizon Air's first route connected Yakima to Seattle–Tacoma International Airport and was followed a week later by Tri-Cities Airport in Pasco to Seattle. The general offices of Horizon Air were operated out of an old house behind Sea-Tac Airport. Horizon acquired Air Oregon on June 17, 1982, after both airlines were losing hundreds of thousands of dollars monthly, in order to consolidate and reduce their operating deficit. Horizon agreed to purchase Transwestern Airlines of Utah in September 1983, once again to try to reduce operating deficit of the airline.
A single Fokker F28 twin jet, purchased in July 1984 from an African carrier, was the first jet owned by Horizon Air (however, the first jet operated by Horizon was a wet leased Douglas DC-9-10).
An initial public offering occurred in 1985 to secure operating capital, which after only one profitable year since founding, was needed to keep the airline afloat. That summer, Horizon entered into its first codeshare agreement with United Airlines, and on September 8, Horizon signed an agreement with de Havilland Canada to begin purchasing the airline's first brand new aircraft, the de Havilland Canada Dash 8-100 twin turboprop.
Late in 1985, Horizon entered into an agreement to purchase their chief competitor in Washington, Cascade Airways, but by early 1986 were released from the agreement. Merger talks between the two had begun in late 1982.
In January 1986, the airline became an international carrier when it began service to Calgary, Alberta, in association with Cascade Airways.
Alaska Airlines struck a deal to acquire Horizon Air in November 1986. The year before, Alaska had undergone a major corporate restructuring with the airline now being owned by the Alaska Air Group, an airline holding company. Under the agreement, the Alaska Air Group became the owner of Horizon Air after approval by the Transportation Department in late December. The Alaska Air Group continued to operate Horizon as a separately branded airline, with a codesharing agreement with its new sister airline, Alaska, while ending its codeshare with United Airlines.
In 1988, Horizon signed a code share agreement with Northwest Airlines.
International service was expanded in May 1989 with flights to Vancouver and Victoria in British Columbia, using both Dash 8-100 and Fairchild Metroliner turboprop aircraft.
Horizon was the launch customer for the Dornier 328 turboprop, intending to replace the Metroliners with this new aircraft which promised speed and comfort on par with jetliners. In recognition of the order, Dornier painted its second prototype of the 328 in Horizon colors. Twelve aircraft were delivered between November 1993 and November 1995, but they were quickly phased out in late 1997, along with the remaining Metroliners, in favor of fleet standardization to the Dash 8 series of turboprops.
Throughout its history, Horizon has either operated as a standalone carrier or as a regional affiliate of Alaska Airlines, except between 2004 and 2007 when it operated Bombardier CRJ700 aircraft on behalf of Frontier Airlines.
In late 2010, Horizon's parent company, the Alaska Air Group, made the decision to no longer operate Horizon as a separate regional airline. Starting on January 1, 2011, Horizon shifted to a capacity purchase agreement (CPA) business model, which had by that time become the regional airline industry standard. Under the CPA, Horizon operates and maintains its aircraft, while Alaska Airlines is responsible for scheduling, marketing and pricing all flights. As part of the change to the new business model, the Horizon Air brand was retired and all Horizon planes were repainted with a co-branded "Alaska HORIZON" livery.
Alaska Airlines entered into a similar capacity purchase agreement with SkyWest Airlines in May 2011. As part of the agreement, Alaska Air Group managers agreed to sell Horizon's fleet of five Bombardier CRJ700 regional jet aircraft to SkyWest, which used the aircraft to operate six West Coast routes as "Alaska SkyWest". The move left Horizon with a fleet consisting of a single type of aircraft; the Bombardier Q400 turboprop.
Horizon announced in April 2016 that it would expand its fleet and once again operate regional jets, placing an order for 30 Embraer 175 airplanes.
The airline experienced a period of turmoil in 2017. Amid unprecedented growth (spurred by the addition of the new aircraft), Horizon experienced a severe pilot shortage, forcing the airline to cancel hundreds of flights and delay delivery of new aircraft. The pilot shortage was part of a broader problem affecting all regional airlines, but hit Horizon particularly hard. After the airline industry started to rebound in 2013 after a decade long downturn, mainline air carriers started to hire pilots, mostly from regional carriers which offer low wages and limited opportunities for advancement. More experienced regional carrier pilots moved to higher paying mainlines. Horizon responded with drastically increased pay for flight crews and worked with Alaska, its sister airline, to create more opportunities for advancement. As a result, there is an influx of new, young pilots with less experience.