Allegiant Air had another strong quarter of growth

April 3rd, 2008 at 01:28pm Thomas V. Bona

Allegiant Air just released its March and first quarter numbers, showing it continues to fly against the national trend with its growth.

The highlights:

• Another three months of more than 50 percent growth in  passenger numbers year-over-year. Interestingly, it’s not just from having new flights - the passenger growth rate exceeded the increase in departures. Basically, there are plenty of new routes, and older routes gained popularity.
• To further prove that last point, the load factor (how full the planes were) for the quarter was 86.9 percent, up from 82.5 percent last year. For March, it was 90.8 percent.
• The average stage length (how long routes are) continued to drop as the airline focuses on shorter routes to maximize profits while fuel prices increase. Allegiant’s model is such that they make more of their money on hotel bookings, vacation packages and products and services sold on flights than they do from your actual airfare. If they can cut the length of their flights, they can actually increase profits by cutting costs without hurting revenue as much. That’s why you see the average stage length down to almost 900 miles.

What does this mean for Rockford?

• We’re holding up our end of the bargain, growth-wise. In the first quarter, Rockford’s Allegiant routes increased passenger totals by 36.2 percent, according to numbers provided by the airport. While most of that was from having two routes we didn’t have last spring (Phoenix/Mesa, Ariz., and Fort Lauderdale, Fla.), our previously existing routes grew by 7.4 percent themselves. Meanwhile, in March Rockford’s Allegiant routes grew by 44.5 percent; the previously existing routes grew by 15.1 percent.
• Our planes are more crowded than Allegiant’s in general, according to airport calculations. In the first quarter, Rockford’s Allegiant flights were on average 89 percent full; in March alone, they were a whopping 95 percent full.
• So why are we getting less, not more flights? Stage length  - every single one of our routes are longer than Allegiant’s system average, from RFD- Las Vegas (1,450 miles) to RFD-Orladno/Sanford, Fla. (1,030 miles). That’s the biggest barrier to Allegiant’s growth here - its focus cities are so darn far away from Rockford. We need some “world-class leisure destinations” that are closer than 900 miles away!

Anyway, this is further proof that Allegiant’s model seems to be working. I’ll be looking forward to its 1Q financial numbers. According to USA TODAY, if oil prices average $100 for the year, only two airlines would show a profit: Allegiant and Southwest.

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