Thursday, March 10, 2011 | 2 a.m.
Beyond the Sun
- More carry-on luggage costing TSA millions a year (3-3-2011)
- Allegiant Air shifting work to private company, will lay off 168 (3-2-2011)
- Profit for Las Vegas-based Allegiant misses on higher fuel prices (1-31-2011)
- JetBlue, Allegiant waging airfare war in Las Vegas (12-1-2010)
- Allegiant Air dispatchers to seek union representation (11-29-2010)
- Las Vegas-based Allegiant Air plans flights to Hawaii (3-5-2010)
When British discount airline Ryan Air proposed charging passengers to use aircraft lavatories last year, consumers were outraged.
Although Ryan Air’s pay-toilet plan hasn’t emerged in the United States, other airlines began scheming to develop new cash streams, resulting in an estimated revenue of $22.6 billion worldwide for airlines in 2010.
As Ryan Air was toiling with the toilet plan that never came to be, Miramar, Fla.-based Spirit Airlines, a discount carrier that has most of its flights to and from the Caribbean, put together a plan to charge passengers a fee for carry-on bags.
Spirit, which has three McCarran International Airport round trips a day, one each to and from Chicago, Detroit and Fort Lauderdale, Fla., and just announced Las Vegas-Los Angeles service five times a day beginning in May, allows passengers to bring one personal item aboard for free as long as it can fit under a seat. It charges for any carry-ons stowed in overhead bins: $20 for the airline’s $9 Fare loyalty club members, $30 for nonmembers with advanced check-in and $45 at the gate.
More carry-on fees may be heading Las Vegas’ way.
Allegiant Air, the seventh-busiest McCarran operator with 122 flights a week to 45 destinations, is considering fees for carry-on bags.
“We definitely think that has a lot of merit, and we’re studying it,” Allegiant President Andrew Levy said in an interview in this week’s In Business Las Vegas, a sister publication of the Sun. “I expect us to move in that direction.”
Levy said if Las Vegas-based Allegiant adopts the plan, it probably would start by summer.
He isn’t expecting outrage from customers, though. In fact, he says customers have been asking for it because standard baggage fees ranging from $15 to $35 a bag have led to cabin clutter that delays flights.
“The reality is that because we charge for checked bags, there are fewer checked bags, and more people are bringing things into the cabin,” he said. “That typically ends up delaying flights and inconveniencing a lot of our customers.”
Levy said a vocal minority has complained about being “nickel and dimed” by airlines’ fees. But he said it’s only fair that you pay for the services you ask for.
“Personally, I usually travel with just a carry-on so I don’t incur those (baggage) charges,” Levy said.
But an industry analyst thinks Allegiant, the industry leader in percentage of revenue attributed to ancillary fees with an estimated 27.3 percent in 2010, could get burned if it adds a carry-on fee, including greater scrutiny from federal regulators. Regulators are keeping a close watch on fees after seeking comments from the industry last year on several issues, such as baggage charges, tarmac delays and the full disclosure of ticket prices in ads.
“It all boils down to, ‘Do I have the right to take a change of underwear with me?’ ” said Mike Boyd of Evergreen, Colo.-based aviation consultant Boyd Group International.
“They have the right to do it and they’re in the travel business,” Boyd said. “If anybody can do it, it’s Allegiant. But you have to be careful in pursuing that strategy because it can annoy the customer. And how badly do you really want to bang on (Transportation Secretary) Ray LaHood’s cage? Upselling a customer is one thing, but taking advantage of them is another.”
Other changes are in the wind for Allegiant, Levy said:
• Allegiant’s growing Boeing 757 fleet could be used for trips between Las Vegas and Mexico and South America. Talking about its purchase of six of the twin-engine jets to begin service to Hawaii in 2012, Levy said “we think longer term that there are opportunities to go internationally out of Las Vegas and this airplane can go about seven hours, so it can get you into the northern parts of South America.”
• A decision still hasn’t been reached on the end points of Hawaii service. “I don’t know if we’ll do anything out of Las Vegas, at least early on. Hawaiian (Airlines) has a lot of service in and out of Las Vegas, both in Honolulu and Maui. But we are going to target some of our small cities on the West Coast into Hawaii as well as some cities that today we don’t serve at all.”
• He was surprised by the competitive reaction from JetBlue and the fare war that erupted when Allegiant offered $20 fares to Long Beach, Calif., this year. “I thought with our limited ability to grow there, they’d probably simply ignore us. But they didn’t, so they dropped fares to match us and then Southwest dropped fares in other airports in L.A. to match them, so we’ve really made travel to the L.A. Basin a bargain for everybody.”
• The vote by Allegiant’s flight attendants to have the Transport Workers Union as a collective bargaining agent brings a third party to the table — a term the flight attendants and the union dispute. “There’s no question they (the union) are a third party. … While I’m certain that there will be Allegiant employees in the negotiating committee, I’m certain there will be other people that are not Allegiant employees. I think it’s kind of silly to pretend that it’s not a third party.”