Shane Tackett

Chief Financial Officer & Executive Vice President of Finance, ALASKA AIR GROUP INC

Shane Tackett, EVP Finance and CFO, Alaska Airlines

🎥 Jun 04, 2024 📺 IATAtv ⏱ 2m 👁 226 views

Shane Tackett, EVP Finance & CFO, Alaska Airlines interviewed at the 80th IATA Annual General Meeting (AGM) and World Air ...

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About Shane Tackett

Shane Tackett, Chief Financial Officer and Executive Vice President of Finance at Alaska Air, spoke at the 2024 IATA Annual General Meeting about the airline’s approach to artificial intelligence and operational challenges. Tackett said that Alaska Air benefits from being headquartered in the Pacific Northwest, near “the five most valuable companies by market cap on Earth” that are engaged in technology and AI. He noted that a Microsoft executive sits on Alaska Air’s board and has provided advice on how to begin using AI, and that the airline has sought partnerships with technology companies that can scale the technology and provide infrastructure that Alaska Air could not develop on its own. Tackett described the airline industry as inherently unpredictable, with daily disruptions from weather, maintenance, or employee availability. He stated that improving “operational resiliency” would benefit customers by helping flights arrive on time and would also improve the airline’s cost environment by requiring fewer assets. He expressed hope that AI could be applied to airspace management, noting that time is “ultimately what we’re selling to people” and that reducing trip time would benefit the company, guests, the industry, and the environment. He added that fuel is the airline’s largest input cost and that optimizing airspace and ramp operations could reduce fuel consumption.

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Transcript (3 segments)

Shane Tackett0:06

We're lucky being in the Northwest part of the United States, off the West Coast. We have as neighbors the five most valuable companies by market cap on Earth, and all of them are engaged in technology and AI. We've got a Microsoft executive on our board, and so we got a lot of advice and insight about how to get started on this journey from people we have good relationships with, local to where we happen to be headquartered. We really were able to think about both the need to partner with technology companies who know this technology really well, who can scale it, who have the infrastructure to be able to do it in a way that we probably couldn't, and to get ideas about the most likely use cases that might show results earlier rather than later.

I think this idea of operational resiliency: when things go wrong, airlines are complex. Best laid plans never work. Every single day something that we didn't plan for happens, whether it's weather that we couldn't plan for, or an aircraft needs us to go and do something from a maintenance perspective, or an employee can't make it to work. So we're always having to respond and react to these variables that are coming at us and are really hard to predict how they're going to impact the rest of the day of operation or even the next day. That's the most important thing to our customers: they want to get to where we said they were going to go on time. Anything we can do to create more resiliency in the system is going to be better for customers. And then, look, I'm a CFO, so I care about the bottom line as well. If the airline is resilient, we'll operate more on time, we'll have to use less assets to do so, so it'll be a better operating cost environment for us as well.

I hope we are able to apply it really to airspace management, because again, getting back to time, that's ultimately what we're selling to people. Time matters. If we can take less time to operate a trip, that's going to be good for our company, good for guests, good for the entire industry, and it's going to reduce the carbon footprint of airlines. The number one input cost for airlines is fuel, and a lot of that fuel is driven by the operating environment we are operating within. So if we can optimize airspace and optimize the ramp area as well, it's going to be better for airlines, better for the planet, and better for guests.