Fast-growing U.S. airline Allegiant Air has decided to stop operating the Cuban family charter programs that it currently flies for five separate charter program sponsors and has exercised the 120-day notice periods in the relevant contracts to cancel them.
Las Vegas-based Allegiant Travel Company has also issued a forecast preducting that its airline subsidiary, which has grown fast and remained profitable throughout the current recession because of its pioneering business model that links tertiary U.S. airports with secondary and primary U.S. airports (many of them prime vacation destinations) with low-frequency scheduled service, will continue to keep growing quickly throughout the rest of 2009.
“While our Cuba flying has been and continues to be profitable, these programs are exposing the airline and its people to operational complexity inconsistent with our operating philosophy,” says Maurice J. Gallagher, Jr., CEO of Allegiant Travel Company.
“Keeping things simple is a key attribute of our business model and since we are not short of profitable opportunities consistent with operational simplicity, we decided the sensible thing was to remain true to our proven operating philosophy and return our people and aircraft to such efforts,” says Gallagher.
Allegiant Air has a single aircraft dedicated to its Cuba charter programs and expects to return the aircraft to its scheduled service fleet later this year. Allegiant Air’s charter planning team is working closely with the five Cuba program sponsors affected to ensure a smooth transition for all the parties involved.
The airline’s parent company expects Allegiant’s third-quarter departures to grow approximately 35 per cent, and its total available seat-mile (ASM) capacity to grow by approximately 40 per cent, compared with the same period in 2008. (The available seat-mile figure for any flight represents the number of total passenger seats on the aircraft times the number of miles flown.)
Allegiant Air also expects its fourth-quarter departures to grow approximately 12 per cent and its fourth-quarter ASMs to grow approximately 18 per cent compared with the fourth quarter of last year.
The airline operates a sizeable, all-McDonnell Douglas fleet, composed of 150-seat MD-83s and 130-seat MD-87s.