Friday, March 05, 2010

Allegiant Air Buying 757s for Hawaii Routes Linked With Leisure-Travel Package Deals

One of the more interesting leisure air-travel stories recently has been the growth of Allegiant Air, the Las Vegas based airline that carves out underserved leisure routes and flies them a little like a commercial carrier and a little like a charter that specializes in package deals with hotels and other services.

Allegiant said today is plans to buy six 757-200s to expand its leisure travel strategy into Hawaii, starting in the fourth quarter of this year with two deliveries.

Another 757-200 will be delivered in November, and a fourth one next January, Allegiant said. The remaining two will be delivered in the fourth quarter of 2011.

Allegient said it is buying the 757s specifically to fly to and from Hawaii, which it can not now serve with its existing fleet of 46 MD-80s.

The company CEO Maurice J. Gallagher Jr. suggested that Allegient's model will be to package land promotions, like hotel deals, with air travel in the languishing Hawaii market, which has lost significanty air service in recent years because it's a stubbornlyu low-fare market that's expensive to serve.

In a statement, Gallagher said: "Hawaii is the most prominent U.S. leisure destination currently un-served by Allegiant, and our small-city customers have been requesting this service. We are very optimistic about our ability to exploit the large third-party ancillary revenue opportunity we believe exists in Hawaii. We expect the sale of hotels, rental cars, and many attraction and activities popular with Hawaii visitors will provide a very meaningful contribution to the success of the service."

He added, "This transaction will enable Allegiant to extend to Hawaii its strategy of serving large leisure destinations from smaller cities [that have] no existing nonstop service."

Allegiant's successful strategy has been to travelers in small cities with diminishing major-carrier service to big, traditionally low-fare leisure destinations such as Las Vegas, Phoenix, Los Angeles, Orlando, Tampa/St. Petersburg, and Fort Lauderdale.


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