SCHEDULE 14A 

Proxy Statement Pursuant to Section 14(a) of the Securities 
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant |_| Filed by a Party other than the 
Registrant |X| Check the appropriate box: |X| Preliminary Proxy 
Statement |_| Confidential, for Use of the Commission Only (as 
permitted by Rule 14a-6(e)(2)) |_| Definitive Proxy Statement 
|_| Definitive Additional Materials |_| Soliciting Material 
Pursuant to ss.240.14a-12

THE ALASKA AIR GROUP, Inc. ("AAG") (Name of Registrant as 
Specified In Its Charter)

Steve Nieman, Richard D. Foley and Robert C. Osborne MD (Name of 
Persons Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box): |X| No fee 
required |_| Fee computed on table below per Exchange Act Rules 
14a-6(i)(4) and 0-11

1) Title of each class of securities to which transaction 
applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction 
computed pursuant to Exchange Act Rule 0-11 (set forth the 
amount on which the filing fee is calculated and state how it 
was determined)

4) Proposed maximum aggregate value of transaction:

5) Total fee paid:

|_| Fee paid previously with preliminary materials.

|_| Check box if any part of the fee is offset as provided by 
Exchange Act Rule 0-11(a)(2) and identify the filing for which 
the offsetting fee was paid previously. Identify the previous 
filing by registration statement number, or the Form or Schedule 
and the date of its filing. 1) Amount Previously Paid: 2) Form, 
Schedule or Registration Statement No.:

3) Filing Party:

4) Date Filed: PROXY STATEMENT ANNUAL MEETING OF STOCKHOLDERS 
Scheduled to be held at the William M. Allen Theater at The 
Museum of Flight, 9404 E. Marginal Way South, Seattle, 
Washington at 2 p.m. on May 20, 2003. For more details, please 
reference the Company_s proxy statement.

SOLICITATION, VOTING AND REVOCATION OF PROXIES
Richard D. Foley, Steve Nieman and Robert C. Osborne, MD

Note:  The AAG_s Proxy Statement is incorporated by reference in 
its entirety.

Hello. Allow us to introduce ourselves:  We are Richard Foley, 
Steve Nieman and Dr. Robert Osborne.  We are the CHALLENGERS for 
ELECTION to the board of directors of Alaska Air Group, Inc. 
("the company").  We are running against the INCUMBENTS 
nominated for re-election by the incumbent board.  All three of 
us have agreed to accept nomination and to serve if elected.  
For more information on us, see the fifth and sixth sections 
below titled INFORMATION ABOUT and PARTICIPANTS IN THE 
SOLICITATION.  

The CHALLENGERS provide these proxy materials to enable you to 
exercise your right to vote for their election to the board of 
directors at the company's 2003 Annual Shareholders Meeting.

Shareholder rights, corporate democracy and corporate governance 
have become subjects of debate to the extent that the US 
Securities and Exchange Commission ("SEC") has announced on 
April 14, 2003 that it will "Review Current Proxy Rules and 
Regulations to Improve Corporate Democracy." (See www.sec.gov).  
We believe the existing systems can be confusing, complex and 
open to some degree to opposing legal interpretation.  However, 
within the range of legal choices a company can make, we think 
there are choices that are optimal and help the shareholders to 
have a better understanding of complex subjects.  Similarly 
there are choices, we believe, that are less than optimal. In 
our opinion, we think that wherever equally legal alternatives 
exist, the one that optimizes shareholder understanding should 
be the one selected.

In the case of our company, we see examples of what we think can 
be characterized as both types of choices.  An example of an 
optimal choice can be found on page 42 of the Company's proxy 
statement under the heading OPPOSING SOLICITATION.  This 
provides the shareholders important information about the 
CHALLENGERS.  It properly names them and thereby, we think, 
infers that there are six nominees to select from for the three 
seats up for election.  However, the company, as was its right, 
chose to OMIT the names of the CHALLENGERS from the Company's 
proxy voting card.  We believe that choice was less than 
optimal.

We think that once having informed the shareholders about the 
OPPOSING SOLICITATION and naming the individuals on that 
alternate slate, it would have been more optimal for the 
shareholders to have been empowered to exercise their right to 
vote for, against or withhold from any combination of three of 
the six had all six appeared on the companys proxy card.  THE 
CHALLENGERS WERE NOT OFFERED AN OPPORTUNITY TO ACCEPT OR 
REJECT SUCH AN OPTION.  Had the company made such an offer, the 
CHALLENGERS would have accepted it.

Therefore, the CHALLENGERS, Richard D. Foley, Steve Nieman and 
Robert C. Osborne, M.D. are undertaking to provide you this 
proxy statement and proxy card to enable you to vote on all the 
candidates who are running.  We asked the company to allow us to 
include the incumbent nominees on our proxy voting card, but, as 
was their right, the Company declined.  We think this was a less 
than optimal choice.  We believe that a fresh perspective is 
needed on the board of directors, and that our company would 
benefit from electing the three CHALLENGER candidates.

We think that this year where there is an ALTERNATE SLATE 
CONTESTING FOR ELECTION, AND A SOLICITATION IN OPPOSITION TO THE 
COMPANY that it may become an example for study in the SEC_s 
upcoming review on corporate governance and the proxy system. 

EXPENSES

The total amount to be spent directly or indirectly will not 
exceed $500 in aggregate.  Contrary to customary practice, we 
have chosen regardless the outcome of the vote NOT TO SEEK 
REIMBURSEMENT FOR THIS SOLICITATION from the company.  In many 
contests, if the CHALLENGERS win they seek to have their 
expenses reimbursed by the Company, such as duplicative 
mailings, etc.  In our view such a practice causes the 
shareholders to pay twice for essentially the same thing.  We 
plan limited printing or mailing by the U.S. Post Office or any 
other carrier.  Electronic mail (email) will be used to 
communicate with and contact some of the shareholders of the 
company, such as institutional holders.

DIRECTOR COMPENSATION

If elected, all three CHALLENGER candidates have agreed that any 
director compensation paid by the Company beyond reimbursement 
of expenses incurred in attending meetings BE DONATED TO THE 
EMPLOYEE ASSISTANCE FUNDS (EAF) OF BOTH ALASKA AIRLINES AND 
HORIZON AIR. We are paying for the costs of this solicitation 
collectively, and have pledged not to seek reimbursement from 
the Company.

HOW WE PLAN TO SOLICIT

The dedicated Internet web site www.votepal.com will be used for 
the purposes of conducting our solicitation.  It will contain a 
downloadable/printable version of our proxy statement and proxy 
card.  The proxy card will not be available until we file a 
definitive 14A. The web site will provide email addresses, 
telephone and fax numbers for shareholders to contact us. It may 
also reference the Company_s proxy materials. For those who are 
unable to access the Internet, we will upon certified request 
mail our proxy materials. Requests can be mailed to a postal 
address, which will be provided.

We may use a "telephone tree technique" to ask shareholders if 
they would be willing to contact two or three other shareholders 
to get them to view our web site.  It is our intention to 
lawfully maximize the use of Internet communication tools. We 
will make ourselves available to all media interested in our 
efforts, and will strive to follow all legal requirements, 
regulations and guidelines.

The Company, objecting to the form of our request for the 
shareholder list, informed us that it would exercise what it 
considered its lawful option not to provide us with a copy of 
the shareholders lists.  The company offered, as was within its 
right to do, to mail our proxy statement and proxy card to all 
the shareholders.  As this would have been a second mailing and 
a repeated cost of approximately forty to fifty thousand dollars 
that the CHALLENGERS would have had to pay, we chose to decline.  
Presently over 80% of the Company's shares are held by 
institutional investors, therefore we expect to have little 
difficulty in contacting that percentage of the outstanding 
shares.

It remains to be seen whether the shareholders of our company 
will respond positively to this grassroots proxy solicitation. 
We do not agree with the argument that only shareholders with 
lots of money to spend on litigation, proxy solicitors and 
multiple mailings should be the only ones allowed to communicate 
with other shareholders or be empowered to exercise their 
ownership rights.  

We believe that a more democratic system is a better system.  We 
think that shareholders should not be prevented from properly 
exercising their rights of ownership by a system that creates 
artificial barriers that ensures participation by only wealthy 
shareholders.  We think that a proxy card, like any ballot in a 
democratic system, should contain the names of all qualified 
candidates.  Further, like a regular election, the candidates 
should shoulder the costs of campaigning.  This should apply for 
both incumbents and challengers.

VOTING

WHAT AM I VOTING ON?

You are being asked to vote for the election of the three 
CHALLENGERS as directors from the slate of six, a proposal to 
amend the Company's Certificate of Incorporation to remove the 
super-majority voting provision and [7] stockholder proposals.

HOW DO I CAST MY VOTE USING THE CHALLENGERS_ PROXY CARD?

For employee 401(k) plan participants and registered 
shareholders, there is a Voter Control Number that can be 
obtained from either postal mailed or emailed proxy materials. 
This Voter Control Number is provided by either EquiServe, the 
transfer agent hired by the Company, or by ADP.  ADP is an 
intermediary information processing and mailing agent used by 
stock exchanges for shareholders who own shares through bankers 
or brokers. In order to accurately identify yourself and enhance 
the potential that your proxy will be counted, you may 
voluntarily write in your control number on our proxy card.  
HOWEVER, IF YOU HOLD SHARES IN STREE NAME, YOU SHOULD ALSO 
CONTACT YOUR BANKER, BROKER OR TRUSTEE AND REQUEST A LEGAL FORM 
OF PROXY THAT WILL ENABLE YOU TO VOTE FOR THE ALTERNATE SLATE OF 
CANDIDATES.

We have received guidance from the SEC that the Commission would 
not object to shareholders writing their Voter Control Number 
received from the Company, a banker or a broker on our proxy 
cards.  In addition, those SHAREHOLDERS HOLDING THEIR SHARES 
THROUGH A BANK, BROKER OR TRUSTEE SHOULD CALL THEIR APPLICABLE 
AGENT AND REQUEST A LEGAL FORM OF PROXY. The CHALLENGERS agree 
that you may download and print out as many copies of their 
materials as you feel necessary for sending to the Company, 
EquiServe, ADP, your banker, broker, trustee, any other type of 
intermediary, and for your records.  Please remember if you are 
downloading and mailing one of our proxy cards--SIGN IT AND FILL 
IN THE NECESSARY INFORMATION TO ACCURATELY IDENTIFY YOURSELF AND 
THE NUMBER OF SHARES YOU OWN TO VOTE.  

Primarily, we will be offering and collecting our proxy cards 
electronically. On www.votepal.com, we will provide a proxy card 
in pdf and text format that interested shareholders can view and 
transmit via a secure web page, or download, fill in, sign and 
mail to a post office box or fax number that will be provided.

HOW DO I CAST MY VOTE USING THE COMPANY_S PROXY CARD?

For employee 401(k) plan participants, you will have to vote via 
EquiServe to complete the requirement that the Putnam trustee be 
notified of your voting instructions. This must be completed 
before the May 15, 2003 midnight Eastern Time deadline suggested 
by the Company. (See the company's proxy statement on page 8 
under the heading "You may vote in person at the meeting"; 
second paragraph).  However, our candidates are not printed on 
the Company_s proxy card. Thus, you will need to OBTAIN A LEGAL 
PROXY FROM THE COMPANY OR THE TRUSTEE.  WE ARE STILL IN THE 
PROCESS OF ENDEAVORING TO OBTAIN THE APPLICABLE INFORMATION FROM 
PUTNAM, WHICH IS THE DESIGNITED TRUSTEE. 

GENERALLY ACCEPTED PRACTICE IS THAT THE MOST RECENTLY-DATED 
LEGAL PROXY WILL BE THE ONE COUNTED. 

YOU MAY VOTE IN PERSON AT THE MEETING

We plan to have extra copies of our proxy statements and proxy 
cards available for those shareholders at the meeting who have 
been unable to download copies of them. If you hold your shares 
through a bank, broker or trustee, you must CONTACT THEM TO 
RECEIVE FROM THEM A LEGAL PROXY, and bring the legal proxy with 
you in order to vote at the meeting. You may call and request a 
legal proxy from your stockbroker, or download and print one at 
the Internet voting site to which your proxy materials direct 
you, or from the CHALLENGERS web site. To enhance the 
probability that your vote will be counted, you will need to 
voluntarily write in the Voter Control Number, check the names 
of your selections for election, and/or mark your choices 
regarding the proposals, and deliver that completed proxy to the 
inspector of elections or his appointees at the meeting.

FOR EMPLOYEE SHAREHOLDERS, we understand that this situation may 
be confusing.  Some employees have received their materials from 
the Company via the Internet, including electronic voting 
procedures. Some employee shareholders may receive their proxy 
materials and proxy card on paper from the Company.  Further, 
there are two trustees for company 401(k) plans:  the Company is 
one, and the second is Putnam, which is the designated trustee.  
We are endeavoring to gather the correct procedures and will 
provide them in our final definitive filing.  As things stand at 
the time of this filing, employee shareholders through company 
plans, including the 401(k), are not being provided with a 
practical method to vote for the CHALLENGERS.  Some of the 
causes for this state of affairs regarding the employee 
shareholders is due to the choice we made not to do a regular 
mailing. HOWEVER, WE BELIEVE THAT EMPLOYEE SHAREHOLDERS SHOULD 
BE ENTITLED TO A PAPER PROXY CARD, AND SHOULD BE EMPOWERED TO 
SUBMIT A LEGAL PROXY TO VOTE FOR THE CHALLENGERS. WE RECOMMEND 
THAT EMPLOYEE SHAREHOLDERS CONTACT THE COMPANY TO REQUEST A 
LEGAL PROXY, OR RECEIVE AN EXPLANATION WHY THEY ARE NOT ENTITLED 
TO RECEIVE ONE.

The law of Delaware, under which the Company is incorporated, 
specifically permits electronically transmitted proxies, 
provided that each such proxy contains or is submitted with 
information from which the inspectors of election can determine 
that it was authorized by the stockholder. (General Corporation 
Law of the State of Delaware, Section 212(c).)

In general there is some disagreement on whether electronically 
transmitted proxies are valid and lawful where a state of a 
"contested election" has been declared.  The CHALLENGERS 
position on this is that we have no objection to electronic 
proxy voting.  We have discussed this with the Company, and 
indicated our willingness to participate in developing a viable 
method to maximize the convenience for shareholders to vote, and 
maximize the ease and accuracy of the tabulation of the proxy 
votes.  Our position is that the determination of a contested 
election exists when the company and the CHALLENGERS have filed 
accordingly with the SEC.

We understand that the New York Stock Exchange usually does not 
agree with positions like ours. It maintains that challengers 
have to pay ADP to do a mailing to all shareholders who hold 
their shares in street name through banks, brokers or other 
intermediaries.  We can only view such a position as being wrong 
on two counts:  We believe (1) that this decision should be made 
by the participants and the SEC--not by intermediaries; and (2) 
to be forced to pay for an essentially duplicative mailing is 
for all practical purposes little more than a form of legal 
extortion. 

WHAT IF I CHANGE MY MIND AFTER I SUBMIT MY PROXY?

If the proxy is signed with a voting direction indicated, the 
proxy will be voted according to the direction given. If no 
direction is given with respect to a proposal, the proxy will be 
voted as follows with respect to any such proposal (listed in 
the order of presentation and using the same numbering as the 
Company's proxy materials for ease of comparison): For Proposals 
1 through 9 and for director candidates Richard D. Foley, 
Stephen Nieman and Robert C. Osborne MD. We again direct you to 
the Company_s Proxy Statement.

Before the polls close at the meeting, you may revoke your proxy 
and change your vote by submitting a later-dated proxy. Before 
the day of the meeting, you may do this by contacting us via 
fax, phone or email, which will be provided. Finally, you can 
send written revocation to: Keith Loveless, Corporate Secretary, 
Alaska Air Group, Inc., PO Box 68947, Seattle WA 98168-0947. 
Telephone number (206) 431-7040.

Reiterating, how are shares in the Company_s 401(k) plan voted?

At the record date, The company 401(k) trust held 1,679,193 
shares, which are eligible to be voted by employee participants. 
(See the Company_s Proxy Statement, page 9, column 2 par. 3). 
The proxy card sent with the proxy statement by the Company's 
transfer agent, EquiServe, covers shares held in the 401(k) 
trust as well as shares held of record, if any. Unfortunately, 
the names of our candidates are not on the Company_s EquiServe 
proxy card. The trustee will vote the shares in accordance with 
instructions received from participants. If you want to vote our 
candidates, you will have to mark "withheld" for the three 
director candidates nominated by the Company.  We feel this step 
must be taken because sending instructions is important: Lacking 
guidance, the trustee will vote shares for which no instructions 
were received in the same proportion, for and against, as the 
shares for which instructions were received.  WE FURTHER 
RECOMMEND THAT EMPLOYEE SHAREHOLDERS WHO VOTE THROUGH THE 401(K) 
PLANS CONTACT THE COMPANY FOR A LEGAL FORM OF PROXY OR AN 
EXPLANATION WHY THEY ARE NOT ENTITLED TO ONE.

The entire question of what is and what is not a legal proxy may 
be disputed.  Therefore, we recommend all interested 
shareholders print out at least two copies of our proxy cards, 
vote, sign and mail one to EquiServe_s address, and mail the 
second to our postal address. Additionally, you will need to 
write the Voter Control Number on it, and also execute our 
electronic proxy card.  We will attempt to notify EquiServe of 
the CHALLENGERS_ proxy cards that we have collected.  WE 
UNDERSTAND THAT THIS PROCESS IS MORE COMPLICATED THAN YOU WOULD 
PREFER, BUT IT IS THE ONLY METHOD WE HAVE BEEN ABLE TO DEVISE 
THAT WILL ALLOW THE FULL EXERCISE OF YOUR SHAREHOLDER RIGHTS TO 
HAVE AN OPPORTUNITY TO VOTE THREE FROM THE SIX CANDIDATES.

Reference the Company_s Proxy Statement which states:  To allow 
sufficient time for voting by the trustee, the Company instructs 
that your voting instructions for 401(k) plan shares must be 
received by 11:59 p.m. Eastern Time on May 15, 2003. (See page 8 
under the heading "You may vote in person at the meeting" second 
para.).

INFORMATION ABOUT NOMINEES

Mr. Richard De Wayne Foley, 56; retired 32-year railroad 
conductor and President of The Foley Group. Mr. Steve Nieman, 
50; pilot for Horizon Air since 1978. Robert C. Osborne, M.D., 
58; physician in private practice. For more information, see the 
heading PARTICIPANTS IN THE SOLICITATION below.

Mr. Nieman and Mr. Foley became acquainted with each other 
through membership in CESJ_the Center for Economic and Social 
Justice, a non-profit organization advocating stakeholder 
ownership among other advocacies.  In 2000, Mr. Nieman formed 
the non-profit Washington State corporation HACECA, Inc., which 
stands for the Horizon/Alaska Customers/Employees Co-Ownership 
Association.  After Mr. Foley and Mr. Nieman became acquainted, 
Mr. Nieman asked Mr. Foley to join HACECA's board, which he 
agreed to. HACECA is neither a party to, nor an associate in 
this solicitation.  However, in response to SEC guidance, HACECA 
is listed below as a participant.

Mr. Nieman traveled to Tucson, Arizona in March 2002.  Mr. Foley 
introduced Mr. Nieman to Robert C. Osborne, MD during this 
visit.  Sharing similar interests in employee ownership, these 
three men agreed to work to build a resource of information and 
assistance to promote responsible exercise of employee ownership 
shareholder rights.  Under that premise, they formed OUR 
(Ownership Union), which was certified by the U.S. Dept. of 
Labor in June 2002. OUR is neither a party to, nor an associate 
in or participant in the solicitation.

In the fall of 2002 at the request of Mr. Nieman, Dr. Osborne 
and Mr. Foley agreed to accept nomination for election to the 
board of directors of the company.

PARTICIPANTS IN THE SOLICITATION

Steve Nieman, Richard D. Foley and Robert C. Osborne MD are 
participants in the solicitation.  Neither Mr. Foley nor Dr. 
Osborne owns any of the company's stock. Only Mr. Nieman owns 
stock, a total of approximately 750 shares, bought through 
various Company stock-buying plans over the last 20 years.

Neither Richard D. Foley, Steve Nieman or Dr. Osborne has any 
family relationship with any of the officers or directors of the 
company, nor are they parties to, or in any way involved in any 
securities litigation involving the company, or any other 
registrant.  None of them are promoters or control persons.  
None of them have been in involved in any bankruptcy petitions 
or proceedings.  None of them have been involved in any type of 
transaction or any other type of business relationship with the 
company, other than Mr. Nieman's employment as a pilot with 
Horizon Air.  None of them have been involved in any 
solicitation of any registrant within the last five years.  None 
of them have received any payment or income, other than Mr. 
Nieman's within the normal course of his regular employment.

RICHARD DE WAYNE FOLEY
6040 N. Camino Arturo Tucson, AZ 85718 President & CEO. The 
Foley Group ("TFG") November 1989 to present.

Principal business: Consulting; Shareholder services & computer 
mapping.  TFG was incorporated in November 1989. Please note 
that TFG has no corporate involvement with any shareholder 
actions at the company; nor are any of its officers, employees 
or associates in the company.  Mr. Foley and TFG own no shares 
of the company either beneficially or in any other manner; nor 
do they have any business relationships, past, existing or 
contemplated with the AAG; nor any purchase or ownership, the 
voting of any proxies, or the withholding of any proxies of the 
company's stock.

Founder of OUR (Ownership Union), and serves as Chairman. OUR is 
a registered federal labor union started in 2002.  Address: Box 
602, Brush Prairie, WA 98606.

Mr. Foley has not been convicted in a criminal proceeding 

Note: Mr. Foley has agreed to assist several employee 
shareholders of the company, including Mr. Steve Nieman, in the 
exercise of their shareholder rights to make proposals, and to 
serve as a communication coordinator for these shareholders.  In 
every instance of this assistance, the individual shareholder 
retained full control of the action of the exercise of their 
shareholder rights.  In no case or instance has there been any 
contract or agreement wherein Mr. Foley would be paid or receive 
any compensation of any kind by or from any of these 
shareholders or any other parties.  The limited proxy by these 
shareholders did not include any voting rights, and it was 
limited to assisting in the preparing and presentation of 
shareholder proposals to the company, and follow up with any 
necessary revisions.  With the single exception of Mr. Nieman, 
none of the other shareholders assisted by Mr. Foley are 
associated in any way with this contest or any solicitation of 
proxies for votes at the Company's 2003 annual meeting and 
election of directors.

STEVE NIEMAN
Pilot for Horizon Air since December 1978. Address:  Horizon Air 
8070 N.E. Air Trans Way Portland, OR 97218

Home Address: 15204 NE 181st Loop, Brush Prairie, WA 98606. 
Phone: (360) 687-3187.

President of the Horizon/Alaska Customers/Employees Co-Ownership 
Association, a non-profit incorporated Aug. 2000 in Washington 
state--Address: Box 602, Brush Prairie, WA 98606. Founder of OUR 
(Ownership Union), which is a registered U.S. federal labor 
union started in 2002--Address: Box 602, Brush Prairie, WA 
98606.

Mr. Nieman has not been convicted in a criminal proceeding 

Mr. Nieman knows many employee shareholders of the registrant. 
Mr. Nieman is associated with Dr Osborne and Richard D. Foley in 
only non-profit organizations.

Steve Nieman is not a "significant employee" of the Company as 
described in the SEC regulations S-K.

Robert C. Osborne, MD
Osborne Anesthesia Services. Address:  800 N. Swan Rd. Suite 114 
Tucson, AZ 85711.  Phone (520) 319-2093.

Dr. Osborne is 58 years old. He is a physician in private 
practice.

Founder of OUR (Ownership Union), and Secretary/Treasurer. OUR 
is a registered federal labor union started in 2002.  Address: 
Box 602, Brush Prairie, WA 98606.

Mr. Osborne has not been convicted in a criminal proceeding 

THE HORIZON/ALASKA CUSTOMERS/EMPLOPYEES CO-OWNERSHIP 
ASSOCIATION, INC. ("HACECA") was founded by Steve Nieman.  It is 
a non-profit organization formed to promote better understanding 
and cooperation between employees, customers and shareholders.  
As a method of addressing the varied and sometimes conflicting 
interests of these groups, HACECA chose to define relationships 
between the three on a conceptual basis revolving around 
expanding ownership.  In various writings at various times 
appearing on a number of pages on the HACECA web site 
www.eahop.org, arguments are presented advocating a 
restructuring of ownership designs of the company through a 
unique form of sale.  A more common term to which HACECA may be 
understood would be an ESOP or employee stock ownership plan 
purchase of a company.  However, HACECA also advocates including 
customers and regular stock market investors participating in a 
more formulated and power-balanced ownership structure.  Thus, 
all writings associated with HACECA should be understood as an 
expression of a business philosophy goal, rather than as 
applying to a specific sale or offer to purchase the AAG.

None of the HACECA_s materials is related to any specific 
proposed sale of the Company.  HACECA owns no stock in the 
company.  It has not contributed any money or any assistance to 
this solicitation.

HACECA has no family relationship with any of the officers or 
directors of the company, nor is it a party to or in any way 
involved in any securities litigation involving the company or 
any other registrant.  It is not a promoter or control person.  
It has not been in involved in any bankruptcy petitions or 
proceedings.  It has not been involved in any type of 
transaction or any other type of business relationship with the 
company.  It has not been involved in any solicitation of any 
registrant within the last five years.  It has not received any 
payment or income from the company except for $1,000 that 
Horizon Air donated to it in Nov. 2000.  It is not an employee 
of the Company, nor had any contractual relationship with the 
Company.  It has never been a party to any legal action civil or 
criminal.  Several abbreviations which appear on HACECA's web 
site such as EAHSOP and CSOPAH stand for Employees 
Alaska/Horizon Stock Ownership Plan and Customer Stock Ownership 
Plan Alaska/Horizon.  A term which may be more common and which 
relates to these types of business relationships is "Co-ops." 
All refer to various types of ownership structures.  

PROPOSALS

For additional information on the following proposals, we direct 
you to the Company's Proxy Statement.

PROPOSAL NO. 1 ELECTION OF DIRECTORS

The challenger candidates have consented to be named in this 
proxy, and to serve if elected. The challenger nominees are:

Mr. Richard De Wayne Foley
Mr. Stephen Nieman
Robert C. Osborne, MD

The AAG_s Board of Director nominees are:

Mr. Bruce R. Kennedy
Mr. Jessie J. Knight, Jr.
Mr. J. Kenneth Thompson

FURTHER MATTERS

IF MR. NIEMAN, MR. FOLEY AND DR. OSBORNE WIN SEATS IN THIS 
ELECTION, none plan to pledge or sign loyalty oaths that might 
be requested by the incumbent board. The challengers believe 
that their duties to shareholders are adequately detailed in 
law. Further, their duties are not subject to any additional 
modification or interpretation by the incumbent board. The 
challengers will interpret their victory as a mandate from 
shareholders to assist in a reorientation of the company.

Because they are privy to information regarding this 
solicitation that other shareholders are not, there might be 
some who feel it would be improper for Mr. Foley and Dr. Osborne 
to buy stock.  Therefore, they will wait until after the 
shareholders meeting to purchase shares.

Regarding Mr. Nieman_s proposal to authorize an auction of the 
company:  IF THE RESOLUTION PASSES, it will send a conclusive 
signal that the Board should take action to address this issue.  
IF THE RESOLUTION FAILS, it could be interpreted as a "vote of 
confidence" in management.

The CHALLENGERS have formulated no specific plans to sell the 
Company.  They have not conducted any specific analysis of 
issues, conditions or financial evaluations necessary to 
effectuate a sale of the Company.  The position they have taken 
about a sale has more to do with setting a goal for positive 
changes in the Company rather than completing a specific sale to 
any buyer.

However, please note in Mr. Nieman's proposal in the Company's 
proxy statement on page 33 PROPOSAL 4 "STOCKHOLDER PROPOSAL ON 
SELLING THE COMPANY," third paragraph under the heading of 
PROPONENT'S SUPPORTING STATEMENT:  "HOWEVER, I BELIEVE THAT THE 
HIGHEST BID WILL INCLUDE THE MEANINGFUL, SUBSTANTIAL, DIRECT, 
FAIR AND EQUAL PARTICIPATION OF ALL EMPLOYEES OF AAG, AS AAG 
EMPLOYEES OWN, IF NOT THE LARGEST, THEN CERTAINLY ONE OF THE 
LARGEST BLOCKS OF AAG STOCK OUTSIDE OF INSTITUTIONAL 
OWNERSHIP(1)."

We reference this because we believe that it expresses the 
essence of the goal for which the proposal was made and the 
reason for our efforts to bring these proxy materials to the 
shareholders. We believe that the employees have not only their 
money invested in the company, but also their lives.  We believe 
that the relationship between employees and the Company must be 
reshaped to provide new flexibility demanded by a market in an 
accelerating rate of change.

IF THE CHALLENGERS ARE NOT ELECTED, they plan to continue to 
exercise their First Amendment rights of free speech regarding 
beliefs they hold. The CHALLENGERS support growing alliances 
between stockholders, employees and customers.

THE FULL DETAILS OF THE FOLLOWING SHAREHOLDER PROPOSALS CAN BE 
FOUND IN THE COMPANY'S PROXY STATEMENT BEGINNING ON PAGE 30 AND 
RUNNING THROUGH PAGE 42.  IT IS HEREBY INCORPORATED BY 
REFERENCE.

PROPOSAL NO. 2 AMEND THE CERTIFICATE OF INCORPORATION TO 
ELIMINATE THE 80% SUPER-MAJORITY VOTING REQUIREMENT

RECOMMEND A VOTE FOR PROPOSAL 2.

PROPOSAL NO. 3 STOCKHOLDER PROPOSAL ON SIMPLE-MAJORITY VOTE--
RECOMMEND A VOTE FOR PROPOSAL 3.

PROPOSAL NO. 4 STOCKHOLDER PROPOSAL ON SALE OF THE COMPANY--
RECOMMEND A VOTE FOR PROPOSAL 4.

PROPOSAL NO. 5 STOCKHOLDER PROPOSAL ON ANNUAL ELECTION OF EACH 
DIRECTOR--RECOMMEND A VOTE FOR PROPOSAL 5.

PROPOSAL NO. 6 STOCKHOLDER PROPOSAL ON STOCKHOLDER RIGHTS PLAN--
RECOMMEND A VOTE FOR PROPOSAL 6.

PROPOSAL NO. 7 STOCKHOLDER PROPOSAL ON AN INDEPENDENT BOARD 
CHAIRMAN--RECOMMEND A VOTE FOR PROPOSAL 7.

PROPOSAL NO. 8 STOCKHOLDER PROPOSAL ON EXPENSING STOCK OPTIONS--
RECOMMEND A VOTE FOR PROPOSAL 8.

PROPOSAL NO. 9 STOCKHOLDER PROPOSAL ON REPORTING EMPLOYEE STOCK 
OWNERSHIP--RECOMMEND A VOTE FOR PROPOSAL 9.

PROXY CARD

The filling out with the required and necessary personal 
information and submission of this Proxy Card is voluntary.

Voter Control Number _______________________________________

The undersigned hereby appoints Steve Nieman and Richard Foley 
proxy, with full power of substitution, to vote with the same 
force and effect as the undersigned at the Annual Meeting of the 
Stockholders of the Alaska Air Group, Inc. to be held at the 
William M. Allen Theater at The Museum of Flight, 9404 E. 
Marginal Way South, Seattle, Washington at 2 p.m. on May 20, 
2003, and any adjournment or postponement thereof, upon the 
matters set forth herein and upon such other matters as may 
properly come before the meeting, all in accordance with the 
notice and accompanying proxy statement for said meeting, 
receipt of which is acknowledged.

(THIS PROXY REVOKES ALL PRIOR PROXIES GIVEN BY THE UNDERSIGNED.) 
This proxy, when properly executed, will be voted in the manner 
directed herein. Please date, sign and send your proxy card back 
today.

When completed and signed, this proxy/voting instruction form 
will be voted as you have directed. If no direction is given, it 
will be voted FOR ALL OF THE CHALLENGER NOMINEES (nominee 
numbers 01/02/03) in Proposal 1, and FOR Proposals 2 through 9.

Proposal No. 1: Election of Directors. Nominees:

(01) (01) Richard D. Foley
(02) (02) Stephen Nieman
(03) (03) Robert C. Osborne, MD
(04)  

FOR ________________________________________________________

WITHHOLD 
____________________________________________________________

THE FULL DETAILS OF THE FOLLOWING SHAREHOLDER PROPOSALS CAN BE 
FOUND IN THE COMPANY'S PROXY STATEMENT BEGINNING ON PAGE 30 AND 
RUNNING THROUGH PAGE 42 AND IS HEREBY INCORPORATED BY 
REFERENCE.

FOR AGAINST ABSTAIN No. 2 AMEND THE CERTIFICATE OF INCORPORATION 
TO ELIMINATE THE 80% SUPER-MAJORITY VOTING REQUIREMENT/ / / / / 
/ Recommend vote FOR Proposal 2. If no direction is given, the 
proxy will be voted FOR Proposal 2.

FOR AGAINST ABSTAIN No. 3 STOCKHOLDER PROPOSAL ON SIMPLE-
MAJORITY VOTE/ / / / / / Recommend vote FOR Proposal 3. If no 
direction is given, the proxy will be voted FOR Proposal 3.

FOR AGAINST ABSTAIN No. 4 STOCKHOLDER PROPOSAL ON SALE OF THE 
COMPANY/ / / / / / Recommend vote FOR Proposal 4. If no 
direction is given, the proxy will be voted FOR Proposal 4.

FOR AGAINST ABSTAIN No. 5 STOCKHOLDER PROPOSAL ON ANNUAL 
ELECTION OF EACH DIRECTOR/ / / / / / Recommend vote FOR Proposal 
5. If no direction is given, the proxy will be voted FOR 
Proposal 5.

FOR AGAINST ABSTAIN No. 6 STOCKHOLDER PROPOSAL ON STOCKHOLDER 
RIGHTS PLANS/ / / / / / Recommend vote FOR Proposal 6. If no 
direction is given, the proxy will be voted FOR Proposal 6.

FOR AGAINST ABSTAIN No. 7 STOCKHOLDER PROPOSAL ON AN INDEPENDENT 
BOARD CHAIRMAN/ / / / / / Recommend vote FOR Proposal 7. If no 
direction is given, the proxy will be voted FOR Proposal 7.

FOR AGAINST ABSTAIN No. 8 STOCKHOLDER PROPOSAL ON EXPENSING 
STOCK OPTIONS/ / / / / / Recommend vote FOR Proposal 8. If no 
direction is given, the proxy will be voted FOR Proposal 8.

FOR AGAINST ABSTAIN No. 9 STOCKHOLDER PROPOSAL ON REPORTING 
EMPLOYEE STOCK OWNERSHIP/ / / / / / Recommend vote FOR Proposal 
9. If no direction is given, the proxy will be voted FOR 
Proposal 9.

*Note* In their discretion, the proxies are authorized to vote 
upon such other business as may properly come before the meeting 
or at any adjournments or postponements thereof.  PLEASE SIGN, 
DATE AND RETURN TODAY. DATE -----------------, 2003
Signature --------------------- Signature ---------------------- 
Title(s) ------------------------ NOTE:  Please sign exactly as 
name appears hereon.  Joint owners should each sign.  When 
signing as attorney, executor, administrator, trustee or 
guardian, please give full title as such.