Traverse City Record-Eagle

Business

July 1, 2013

Tiny Allegiant Air thrives on low costs, high fees

LAS VEGAS (AP) — There are no sure things in this city — with one exception: Allegiant Air.

While other U.S. airlines have struggled over the past decade from the ups and downs of the economy and the price of jet fuel, Allegiant has been profitable for 10 straight years.

The tiny airline focuses on a niche ignored by other airlines: It only flies from small cities to sunny vacation spots.

Allegiant entices people who otherwise wouldn't fly with low fares and non-stop flights. Then it aggressively pitches them hotels, rental cars, show tickets and other entertainment, earning millions in commissions.

Passengers face fees for almost every service and amenity imaginable. At Allegiant, fees for checked baggage and changing an itinerary — which are common on many airlines — are just the beginning.

The Las Vegas-based airline charges extra to book flights online, or to use a credit card. Selecting a seat in advance costs $5 to $75 each way, depending on the length of a flight. Even a bottle of water costs $2.

Flying Allegiant isn't glamorous. While other airlines tout new aircraft with Wi-Fi and TVs in every seat, Allegiant buys old planes to avoid hefty aircraft loans. And to pack in as many passengers as possible, its seats don't recline. But for small-town Americans with limited flight options, these inconveniences are worth it for a few days of sunshine.

"They could be the worst airline in the world and we'd fly them because we want to go to Vegas," says Tom Mayo of Cedar Rapids, Iowa, who recently flew there with his family. "It's our only option."

Allegiant offers non-stop service from places like Owensboro, Ky., Casper, Wyo. and Appleton, Wis., to popular destinations in Nevada, Florida, Hawaii and Arizona. These may not be the most coveted routes in the airline business, but that is precisely why Allegiant likes them.

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