American ultra-low-cost-carrier (ULCC), Allegiant Air, expects Christmas to be another good holiday period for travel. While the airline has noted that while travel demand has slowed, it is seeing resiliency with peak travel days and expects it to hold through, creating a strong Christmas holiday travel period.
Allegiant anticipates a good Christmas
Drew Wells, Vice President of Revenue at Allegiant Air, stated the following about the Christmas holiday period:
“Over the course of the last several weeks, we have seen a deceleration of bookings coupled with an increase in cancellations related to recent surges in COVID-19 cases and new travel restrictions. There continues to be a divergence in terms of strength between peak travel periods and non-peak periods, with peak days showing far more resiliency, a trend expected to hold through the Christmas holiday. We continue to approach demand as we have since the onset of the pandemic by maintaining a wide selling presence and cutting capacity as dictated by demand trends.”
Like many other airlines, Allegiant is seeing more demand close-in to departure than further out. As such, it has to manage its flights closer to departure. As of now, it appears that Allegiant is expecting a very good Christmas, considering the circumstances.
Despite the slowdown in bookings and uptick in cancelations, Allegiant Air is still expecting fourth-quarter capacity to be down only about 15% year-over-year. This is in line with Allegiant’s estimates from October. However, capacity for the fourth quarter is expected to be down more than its third-quarter capacity. This comes as Allegiant even inaugurated new routes in the third quarter.
Daily bookings have slowed slightly
In October, Allegiant recorded average daily bookings of around $3 million. Come November, and average daily bookings averaged roughly $2.2 million. The slowdown in bookings has come as cases rise in the United States, and several jurisdictions have added new travel restrictions. It is below one of Allegiant’s peaks at $4 million a day in gross bookings.
Many bookings these days are done close-in to departure. Based on this data, it appears that Allegiant saw a slowdown heading into the holidays. No doubt, there were plenty of bookings for Thanksgiving and Christmas between November and December, but more recent numbers indicate that some people have shied away from making new bookings.
Allegiant’s November numbers
Mr. Wells’ statement came as Allegiant released its November traffic data. The carrier flew 682,976 passengers in the month, which was down 38% from November 2019. It was also just under 100,000 fewer passengers from October of 2020, indicating that even a strong Thanksgiving could not compensate for the weaker start to the month.
Capacity for the month was only down 13.6% year-over-year. This was more than October’s 6.4% capacity decline year-over-year. Allegiant’s capacity in available seat miles in November was slightly down from October.
The carrier’s load factor stood at 57.6%, which was 22.8% lower than November 2019. November’s load factor was lower than October, which clocked in at 63.1%. The number of departures for November was also slightly below October.
What do you make of Allegiant’s prediction of the resiliency of travel demand on peak days heading into Christmas? Let us know in the comments!
