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Allegiant Air CEO acknowledges 'bad summer,' says changes will help

Florida State Senator Jack Latvala, R- Clearwater, left, talks to Allegiant Air CEO Maurice Gallagher, right, during a post Florida Legislature session breakfast, hosted by Latvala and his son, Rep. Chris Latvala, R- Clearwater, at the Marriott St. Petersburg, Clearwater. Latvala told a reporter and photographer from the Times not to ask questions of Gallagher about the airline.
Florida State Senator Jack Latvala, R- Clearwater, left, talks to Allegiant Air CEO Maurice Gallagher, right, during a post Florida Legislature session breakfast, hosted by Latvala and his son, Rep. Chris Latvala, R- Clearwater, at the Marriott St. Petersburg, Clearwater. Latvala told a reporter and photographer from the Times not to ask questions of Gallagher about the airline.
Published Apr. 22, 2016

ST. PETERSBURG — Allegiant Air CEO Maurice J. Gallagher Jr. acknowledged Thursday that his airline had a "bad summer" last year when the company drew headlines for a string of emergency landings, engine problems and maintenance delays.

"When you put people and machines together, there are going to be problems," said Gallagher, who spoke Thursday morning to a room full of state and local government officials at the St. Petersburg Marriott Clearwater hotel. "The issues you've read about in the paper are directly related to our own growth. We've since changed our management here (in Pinellas County). You won't see that experience again. We had a bad summer last year."

The statements are perhaps the strongest Gallagher has made publicly acknowledging the airline's past troubles. The airline's problems have been covered in a series of stories in the Tampa Bay Times.

Since the summer, Gallagher said that Allegiant, which operates 50 nonstop flights out of the St. Pete-Clearwater International Airport and has grown its operations here by 32 percent over the last year, has taken steps to remedy its problems.

In addition to changing the local management team, Allegiant also plans to hire five new mechanics to work out of the Pinellas County market. And by 2020, the discount airline will phase out its current, older fleet of MD-80 aircraft and replace them with newer Airbus models.

Gallagher blamed the airline's problems on growing pains.

"Any young business goes through something similar from time to time," he said. "We've always been safe. And we will continue to work with the FAA and audit our own practices."

Allegiant has been operating flights out of the Pinellas airport for nearly a decade. In that time, the St. Pete-Clearwater market has grown to be the third largest for Allegiant Air, serving 1.6 million passengers last year. Allegiant currently has 12 planes that fly to and from the Pinellas airport, and it accounts for about 95 percent of the airport's passenger traffic.

"I remember meeting with the airport and they were showing us how many people they were going to lay off" if more flights didn't come, Gallagher said.

Allegiant Air has grown aggressively since its inception in 2004, when the company had just one aircraft and two routes out of Las Vegas. In 2015, Allegiant had 74 planes that fly to 105 cities across the country on 296 routes.

"You want us to make money. You need us to make money. We reinvest in our pilots and other things that way," Gallagher said.

The airline's critics have accused its leaders of putting profits before safety, and a series of high-profile events over the past year added to the narrative.

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That included several Allegiant flights that made emergency landings at the Pinellas airport and other airports over the summer; five emergency landings of Florida flights during the last week of 2015; a flight that made an emergency landing at a closed airport in Fargo, N.D., because it was running low on fuel; and most seriously, an aircraft that nearly crashed in Las Vegas in August when a device on its tail jammed.

When asked specifically about the airline's safety record, Gallagher said Allegiant is always prepared to handle problems and mishaps that are bound to happen. He said that Allegiant works to identify trends and fix those problems quickly.

Gallagher said Allegiant flies older aircraft, specifically MD-80 planes that seat around 160 passengers, though he said Delta and American fly the same aircraft. And other airlines, such as Southwest and Spirit, put more pressure on planes because they fly them more often, he said.

"Our planes don't need to fly as much. They have half the routes, maybe twice a week, compared to other airlines," Gallagher said.

Bloomberg reported recently that Allegiant hired an outside auditor to review its safety programs and regulatory compliance. Gallagher said there are constant internal audits as well.

As for the future, Gallagher wants to add more flights to the area, and perhaps extend service from the county airport to Mexico and the Caribbean.

The event Thursday was hosted by state Sen. Jack Latvala., who introduced Gallagher and said Allegiant is a major employer and economic driver for Pinellas County. He criticized the newspaper for its coverage of the airline and would not allow a Times reporter or photographer to ask Gallagher questions.

"I have great admiration for the Tampa Bay Times most of the time, but every now and then they go down a crooked path," Latvala said. "Their criticism of Allegiant has been relentless and they've gone a little too far. It's been very slanted in one direction."

Latvala said he's an avid Allegiant flier and often books flights from St. Pete-Clearwater to Bangor, Maine.

"The bad press doesn't hurt Allegiant's business. Most of the people who fly on Allegiant aren't from here," he said. "But it hurts their employees here, who have to face their neighbors in this community who read the newspaper reports."

After the morning talk, Gallagher headed to the Sirata Beach Resort in St. Pete Beach for Allegiant's annual station meeting, a conference where airline officials meet with partners from the various airports the company works with. He said the event drew more than 200 people to St. Pete Beach, and it was the first time in the company's history that the conference was held in a destination outside of Las Vegas, where the airline is based.

Contact Justine Griffin at jgriffin@tampabay.com or (727) 893-8467. Follow @SunBizGriffin.

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