Alaska Airlines (AS, Seattle Tacoma International) has secured nearly USD1.2 billion in private loans "to further secure its financial stability and future during the Covid-19 recovery period" while balancing its liquidity, it said in a statement on July 2. The debt financing was to be funded on or around the same date.

As part of an offering of Enhanced Equipment Trust Certificates (EETC), a financial security used in aircraft finance in North America, the carrier will use 61 of its owned aircraft as collateral to back the debt, including twenty-six B737-800s, sixteen B737-900ERs, and nineteen E175s.

The aircraft will remain encumbered until the debt is repaid. Series A (USD966 million) certificates are due to be repaid by August 15, 2027, and Series B (USD208 million) will be repaid by August 15, 2025.

According to the ch-aviation fleets module, Alaska Airlines currently operates a total of sixty-one B737-800s, 51 of which are owned. It has seventy-nine B737-900ERs, all of which are owned.

The Alaska Horizon service operated by Alaska Airlines' subsidiary Horizon Air (QX, Seattle Tacoma International) operates thirty E175s, all of which are owned.

Besides these, Alaska Airlines also operates ten A319-100, fifty-one A320-200, ten A321-200neo, eleven B737-700, three B737-700(BDSF)s, and twelve B737-900s the module shows.

"With this financing and the actions we've taken to reduce our cash burn rate, we've created a liquidity runway that rivals our strongest competitors," Shane Tackett, the company's chief financial officer, said in the statement.

The airline also revealed that as part of the Payroll Support Program (PSP) under the United States' Coronavirus Aid, Relief and Economic Security (CARES) Act, McGee Air Services, a wholly-owned ground services subsidiary that operates independently, had received almost USD30 million in funding.

This is in addition to USD992 million, in the form of a USD725 million grant and a USD267 million loan, that Alaska Airlines and Horizon Air have jointly received to be used exclusively to pay employee salaries and benefits until the end of September.