Allegiant Air, Why It's the Nation's Most Profitable Airline

[Midnight Mike]

But it's no accident that Allegiant's planes are full, profits soared 200% in the first quarter to $28.2 million, and the number of passengers is up 18% through May during the worst recession in recent memory.

While competitors furiously cut back, Allegiant has boosted capacity 30%. The more intriguing question, though, is whether its rock-bottom fares, bootstrap approach, and focus on the places abandoned by the hubs and spokes are the new blueprint for building an airline in tough times.

Certified to fly MD-80s, aging warhorses of the skies, Allegiant could acquire used ones for as little as $4 million, one-tenth of what it costs Southwest to buy a new 737. With no access to capital, Gallagher didn't have much choice. But the plane is a gas-guzzler -- fuel costs can be as much as half of expenses -- so Allegiant couldn't afford an empty seat; keeping the planes full spread the cost across more passengers. "We needed a strategy that was low cost and could make money from day one," Gallagher says. "Slowly, we figured it out: Go where they ain't."

http://www.fastcompany.com/magazine/138 ... rofit.html

[mirrodie]

Has anyone here flown them? WHile low cost, isnt their route structure small and do they ally themselves with other airlines?

[Matt Molnar]

I haven't flown them, but their route network is essentially spokes out of Las Vegas, Orlando, and a few other focus cities to C- and D-list cities like Hagerstown, Peoria and Plattsburgh. Pretty certain they do not have any alliances.

Many think it's cute to compare Southwest to Ryanair, but Allegiant is much, much closer to the Ryan model than WN, maybe even more audacious in some of the fees they charge. On one hand, it's nice that they do provide a valuable service to many airports that would otherwise have no direct service. On the other hand, I think their advertising/pricing model should be illegal.

[Midnight Mike]

I haven't flown them, but their route network is essentially spokes out of Las Vegas, Orlando, and a few other focus cities to C- and D-list cities like Hagerstown, Peoria and Plattsburgh. Pretty certain they do not have any alliances.

Many think it's cute to compare Southwest to Ryanair, but Allegiant is much, much closer to the Ryan model than WN, maybe even more audacious in some of the fees they charge. On one hand, it's nice that they do provide a valuable service to many airports that would otherwise have no direct service. On the other hand, I think their advertising/pricing model should be illegal.

Allegiant gets financial support from both the airports they fly out of & the Vegas hotels, as for fares, they are not doing anything different than what Mesa is doing....

And yes, Allegiant is much closer to RyanAir than Southwest, I think everybody likes comparing a LCC to Southwest, but, there is not much similarities between Allegiant & RyanAir,

[NIKV69]

Casino charters are very profitable, I think they have a deal with Harrahs and their planes are always full when they come into IFP. Plus they are cheap as hell to, they asked for exclusive rights to one of my pics and didn't want to pay anything! Nothing like getting asked for a 5MB original for nothing. Got to love it.

[dimamo1983]

I have flown Allegiant half a dozen times now out of Cedar Rapids down to Sanford. Very convenient for me - 2 hour nonstop flight vs 5-6 hours with stop overs in Atlanta/Cinci/Detroit/You name it and closer to Daytona than MCO. Much easier to get in and get out of SFB as well compared to MCO.
They do have rediculous fares sometimes. For the last two flights this summer, they had $9 tickets! $19 is the cheapest I have flown and usually I jump on $69 each way deal. Flying with anyone else from CID you are looking at $300-$500 roundtrip. Definitely a no-frills approach, but I do not mind it for a quick weekend gateaway.