Allegiant Airlines: Is there a market for a European Allegiant?
Allegiant Airlines is one of North American aviation’s most under-reported success stories. The airline flies to a select number of popular vacation hubs from several relatively remote and seriously underserved destinations across the United States.
Allegiant’s model is genius. It is the only vacation destination player at most of its traffic-starved airports. For residents of many of the catchment areas associated with these far-flung airports, Allegiant offers a cheaper and simpler way to get to popular holiday destinations.
A different kind of budget airline
Allegiant’s model has been quite successful, with the airline growing impressively over the last several years. In March 2010—the most recent month for which statistics are available—the airline saw a traffic increase of 16.4 percent over the previous March. Its load factor grew as well, though less dramatically, from 92.3 percent to 92.9 percent.
Charisse Jones pointed out in a USA Today article late last year that of the airline’s 135+ routes, it faces competition on just five. While this competition-averse strategy may advertise Allegiant’s vulnerability to more powerful airlines, the airline also has enormous room to grow. According to Jones, the airline has identified over 300 potential routes for future development.
Because Allegiant is focused on linking underserved airports with prime holiday destinations, it does not fly to many of the country’s biggest airports. New York’s three airports and Chicago’s two airports take no traffic from Allegiant, and neither do Miami, Atlanta or Houston. The only major airports Allegiant serves are Las Vegas, Los Angeles and Orlando, and all three are big hubs for the airline.
The Luck of Bismarck and Grand Island
Let’s gauge the impact of Allegiant on two markets.
Take Bismarck, North Dakota. Allegiant flies between Bismarck and Las Vegas and Phoenix-Mesa. The other airlines flying to and from Bismarck are Delta (to Minneapolis) and United (to Chicago and Denver). The routes flown by Delta and United are business routes, while Allegiant’s are leisure routes.
Or look at Grand Island, Nebraska, home to the Central Nebraska Regional Airport. Allegiant flies twice a week from Grand Island to Las Vegas and twice a week to Phoenix-Mesa. The only other airline flying to Grand Island is Great Lakes Airlines, which operates a route to Denver. Again, the Great Lakes link is a business route, while Allegiant’s routes are for holiday travelers.
For North Dakotans, Nebraskans and residents of many other states and regions, Allegiant makes air travel to popular vacation destinations easier, cheaper and far simpler than it would otherwise be.
An Allegiant for Europe?
The United States and Europe have very different transportation infrastructures and vacation allotments. For these reasons among others, it is difficult to imagine a precise mirror for Allegiant within the context of Europe.
These differences acknowledged, an Allegiant analogue for Europe—let’s call our new fantasy airline Euro-Allegiant—might fly from places like Aalborg, Leipzig-Altenburg, Lille, Lviv, Kaliningrad, Kuopio, and Wroclaw to holiday destinations like Chania, Fuerteventura, Larnaca, Luxor, Madeira, Monastir and Paphos.
Unlike Ryanair, which connects secondary, often minor airports to multiple destinations, Euro-Allegiant would link its far-flung airports to a limited number of vacation hubs. Euro-Allegiant would start small, fill in the gaps, link up otherwise unpaired destinations, dissolve routes if and when bigger airlines decided to move in and possibly even absorb local charter flight arrangements.
Would this model work in Europe? With some modifications, it just might.