Published: Tue, April 17, 2018
Finance | By Claude Patterson

Allegiant slammed in 60 Minutes segment

Allegiant slammed in 60 Minutes segment

"The story is outdated, bears no resemblances to the Allegiant I know, and shows a real and troubling misunderstanding of the FAA's rigorous oversight of Allegiant and all USA airlines, which is truly the worldwide gold standard in transportation safety", Allegiant vice president of operations Eric Gust said in the statement.

"Allegiant Air has experienced issues in the past, like any growing airline, but has worked to correct them". It also pointed to a Department of Transportation report claiming it had the second-lowest cancellation rate of any airline.

Shares of Allegiant Travel Company (NASDAQ:ALGT) declined 9%, ahead of 60 Minutes piece on the company's alleged high record of in-flight breakdowns.

An engine caught on fire mid-flight during one incident, while in another, hazardous hydraulic fluid dubbed Skydrol 4 filled a cabin still full of passengers. "To be clear, any employee who fails to report safety-related concerns through available channels is in violation of company policies, and may also be in violation of federal regulations".

Todd Curtis, an aviation-safety consultant, said he tells relatives to avoid the airline.

Several arguments have come up against Kinzer incident but it is noticeable that this incident was only one of them from the "60 minutes" report. "60 Minutes" quoted air safety experts and passengers, and public documents show an alarming number of aborted takeoffs, cases of cabin pressure loss, emergency descents, and unscheduled landings.

Allegiant pilots didn't appear in the story.

Allegiant reported more than 100 "serious mechanical incidents" between January 2016 and October past year, according to the CBS report, which was based on "service difficulty reports" filed with the Federal Aviation Administration.

Allegiant also posted a statement dismissing the incidents described in the show as "years old" and as having occurred before the company's latest FAA audit.

John Cox, a former airline pilot and now a safety consultant, said the FAA needs to examine the safety culture at Allegiant, but he dismissed the notion among FAA critics that the agency lets airlines police themselves.

In the first quarter, Allegiant had 3,279,368 scheduled passengers, up from 2,845,480 in the first quarter of previous year, according to a press release issued April 5. He said the airline complies with all FAA requirements, and that any suggestion the airline muzzled employees "is offensive and defamatory".

Las Vegas-based Allegiant was founded in 1997 and operates 85 aircraft and 350 routes in the United States, according to the company's website. Morgan Stanley reiterated an "equal weight" rating and set a $172.00 target price (up previously from $157.00) on shares of Allegiant Air in a research report on Friday, February 23rd. "Our team members safely operate thousands of flights each week, which will transport more than 14 million passengers this year". We have safely carried almost 90 million passengers since beginning operations in 2001.

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