The Hawaii market has been fun to watch for the past few months, but it just got more interesting for those who observe the industry. It’s been rumored for awhile that Allegiant wants to go to Hawaii, and they’re finally doing it. The airline announced Friday that it will be acquiring six 757s from an unnamed European carrier, and they’ll be arriving over the next couple of years. The first two are slated to arrive within the next two months, and will be placed into service in the fourth quarter of this year.
Other than that, we don’t know much more. So let’s get into the analysis/speculation, shall we? To make it easier to read I’ve divided the rest of this post into shorter sections.
A Change in Strategy?
Do I see this as a big change in strategy for Allegiant? No. Allegiant’s current system has been kind of simple – big leisure market on one end of the route, small market on the other end, with MD-80s flying the route a few times a week. President and CFO Andrew Levy said in a press release that “this transaction will enable Allegiant to extend to Hawaii its strategy of serving large leisure destinations from smaller cities with no existing nonstop service,” so that doesn’t seem like there will be any big changes here.
Yes, adding a new fleet type is a big change for Allegiant, but I wouldn’t classify it as a major shift. The airline’s current strategy has been to buy cheap MD-80s that are in good shape, and basically they’ve extended that to another type.
So Where Are the Aircraft Coming From, Anyway?
The answer to that question will help clarify Allegiant’s strategy here, at least a bit. For example, there are two exit configurations for the 757 – three doors and two overwing exits, and four doors. The former can hold no more than 224 passengers in a one-class configuration, while the latter can seat up to 239 passengers.
Another big factor is the engines – 757s come with either Pratt & Whitney PW2000 series or Rolls Royce RB211 series engines. There are a couple of different versions of each type, but it can make a difference. For example, if Allegiant wanted to fly out of Bellingham, Washington to Hawaii with a PW2037-powered 757s, some weight restrictions might be in order, but might not if powered with RB211-535E4 engines. (According an investor presentation released today, the company reports that the aircraft are RB211-535E4 powered.)
So where are these coming from? All Allegiant says is, “The six 757 aircraft are sister-ships and have been in service with a single European operator since original delivery from Boeing. The aircraft come equipped for extended twin-engine operations (ETOPS), as required for long overwater flights.” In a SEC filing from today, the company also reports that the aircraft have RR21-535E4 engines, have an average age of seventeen years, and an average cycle count of 19,000.
Here are my best guesses, from what I think is the most likely to least likely:
- Thomson Airways. The initial rumors about Allegiant and Hawaii involved Thomson 757s.
- British Airways. Yeah, they announced in 2008 that the whole fleet was sold off to be converted into freighters, but, they conveniently have six in storage right now. (Though it appears one of them was with a couple of airlines.)
- Finnair. The carrier is dumping its fleet of seven leisure 757s, conveniently from 2010 to 2012. (Finnair’s have Pratt engines.)
- Thomas Cook.
- Icelandair.
Continue reading ‘Allegiant and 757s: More Questions than Answers’
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