The ultra low-cost U.S. airline, Allegiant hasn’t had a particularly good profile for years but even that tarnished image took a dive earlier this month when a damning ’60 Minutes’ documentary about the airline was broadcast by the American broadcaster, CBS. Shares in the embattled carrier fell over 11% after the documentary aired on the 15th April.
The CBS documentary built on accusations originally reported by Florida’s Tampa Bay Times newspaper from late 2016. They claimed Allegiant didn’t adequately maintain their aircraft and that pilots were discouraged from reporting safety-related issues. Critics claim Allegiant aircraft have suffered a “high number of serious mechanical incidents” in the last few months.
It’s fair to say that Allegiant has had more than its fair share of aircraft incidents and breakdowns. Notable events include a June 2015 emergency landing by an Allegiant jet after smoke filled both the cockpit and cabin shortly after takeoff. Just a couple of months later, the pilot of an Allegiant MD-83 aircraft had to abort its takeoff after the plane didn’t respond properly – caused by a crucial pin that was missing.
Allegiant, however, is not happy with the image painted of it by CBS. The airline’s vice president of operations, Eric Gust responded to the documentary, saying:
“I am outraged and astounded by the irresponsible, grossly misleading story aired by CBS 60 Minutes.”
“The story is outdated, bears no resemblance to the Allegiant I know, and shows a real troubling misunderstanding of the FAA’s rigorous oversight of Allegiant and all US airlines.”
Nonetheless, the steps taken by Allegiant hasn’t stopped RM Law from filing a class action lawsuit against the airline on behalf if its shareholders. They claim Allegiant made false or misleading statements and failed to operate responsibly and ethically.
Despite its poor reputation, Allegiant has built a relatively strong business. The airline has created a niche flying underserved city pairs that larger U.S. airlines have largely ignored due to their focus on a hub and spoke model. Allegiant says it has the second lowest cancellation rate in the industry and has “embedded” a strong safety culture throughout its business.
