Hawaii: Allegiant and Alaska Air Battleground

Alaska Air had two press releases this morning and Allegiant may have more surprises coming. The battle has just started.

• First is Alaska’s so-so airfare sale, perhaps more intended to keep the stoplight on them than anything else.  West coast to Hawaii starts at $149 as we reported yesterday. The only surprise I saw in today’s announcement was Anchorage to Honolulu at $199 each way.
• Of greater interest, Alaska also announced that it will begin service from previously little known Bellingham Airport to Honolulu starting January 7.  This is both a preemptive and a retaliatory move against Allegiant Air.  It squarely pits Alaska in head-on competition with the upcoming Hawaii entrant and nemesis. Look for Allegiant’s announcement soon as to which Mainland cities they will serve Hawaii from.

I don’t expect Alaska’s Bellingham news to be a huge problem for Allegiant. Moreover, I suspect that while we were slightly surprised by the move, they were not.  I’d said earlier, Allegiant still has a surprise or two up their sleeves for us vis-a-vis Hawaii.

Alaska and Allegiant started butting heads recently.

It began when Allegiant announced the Bellingham hub as well as flights from the Northwest to Las Vegas, previously Alaska Air’s domain.  Also this year, Allegiant began LA to Medford and Eugene to Oakland services in competition with Alaska.  Alaska is definitely feeling the competitive heat.

A look at the carriers: Alaska and Allegiant

While Alaska has more financial might, Allegiant is more creative in vacation packaging, ancillary flight sales, and may have a distinct operational advantage. Allegiant’s longer range aircraft could allow them the added flexibility to move flights up to approximately 500 miles inland. This could bring cities like Las Vegas and Salt Lake City (and others) within Allegiant’s range, while keeping them out of Alaska’s non-stop ability.

As  you may recall, Aloha Airlines was unable to reliably provide non-stop service between Hawaii and Las Vegas using 737, due to range limitations.  The flights frequently had to stop on the West Coast, and later the non-stop was scrubbed entirely.

As we previously noted, Allegiant just ordered Blended Winglets for the 757 Hawaii fleet, in part to enable them to extend their flight distances.

Alaska at a Glance.

• Market cap: 1.9 Billion
• Aircraft capable of serving Hawaii:  Boeing 737-800
• Range from Hawaii:  3,383 nautical miles

Allegiant at a Glance.

• Market cap: 904 Million
• Aircraft capable of serving Hawaii:  Boeing 757
• Range from Hawaii:  3,300-4,100 nautical miles

And the Good News.

The fierce competition between these rivals, together with all of the other airline players interested in Hawaii, will undoubtedly mean a plethora of airfare deals for the foreseeable future.

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