Allegiant Airlines has announced that it will be acquiring up to 19 Airbus A319 aircraft via lease and/or purchase and it expects the first aircraft to enter the fleet in the 2nd quarter of 2013.  Allegiant presently operates a large fleet of very used MD-80 aircraft and recently began flying 757 aircraft as a small sub-fleet to support overwater, long distance routes.

The A319 will support growth initially and represent an aircraft that matches seat count for the MD-80 while offering far greater range.  Range will equate to growth opportunities at Allegiant.

Allegiant believes that the changing market for used A319 aircraft now matches what they originally found for the MD-80 as they began as an airline.   It’s true that the A319 has never been a very popular aircraft in general and is on a downward slide presently.  Major airlines prefer the A320 and A321 which offer vastly superior seat costs.  The 737-700, the A319’s competitor, is also seeing a downward slide in value although not nearly as great.

Rather than be alarmed at Allegiant’s adding a new aircraft type, I would suggest that this is good news all around.  Allegiant will benefit from far better seat economics and will be able to obtain aircraft much easier on an on-going basis.  I fully expect that they’ll look for other good deals on A319s to replace their MD-80 aircraft.

Rather than put them at a disadvantage, I expect that this will allow Allegiant to compete even more aggressively against Low Cost Carriers (Southwest, JetBlue) as well as Ultra Low Cost Carriers (Spirit who already uses the Airbus A319 and A320).

Don’t expect a more comfortable aircraft.  Allegiant will cram as a many seats possible onto this aircraft.  Expect roughly 150 seats and compare that to US Airways’ A319s which have 2 class seating for a total of 124 seats or United Airlines’ A319s which have 3 class seating for a total of 120 seats.  Allegiant notes that it might be able to fit more than 150 seats if an additional overwing exit is added.   Spirit’s A319s have 145 seats with a seat pitch of about 30″ so I expect that Allegiant is planning on a 29″ seat pitch and that is not a comfortable seat in the United States.

It’s a good purchase for Allegiant and signals the direction that residual lease values will have on both A319/A320 as well as 737-700/800 aircraft as the A320NEO series and 737MAX series get ordered by major legacy airlines.  This is exactly what lessors didn’t want to see happen to the aircraft they hold but it was largely unavoidable and particularly so when one sees major airlines upsizing their aircraft considerably.

Filed under: Airline Fleets by ajax
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