How Allegiant customers could become oil-price gamblers
I have never flown on Allegiant Air or done any reporting or opining on it. What I know comes from others' reporting: The Las Vegas-based carrier, which serves Allentown's Lehigh Valley International Airport, but not PHL, makes good money. Its business model, which veteran consultant Mike Boyd said a few years ago has no flaws in it he could find, calls for flights a few times a week between smaller cities or airports, like ABE, and Vegas or Florida. It obviously doesn't want to be in big hubs like PHL. Virtually all its customers are leisure fliers (or are they? Give me reports if you've flown on it) . Allegiant also chargesas much or more in fees as any other carrier, while keeping base fares low.
Allegiant now has come up with one of the most interesting ideas I ever heard of for pricing airline travel. It has proposed to the US Departtment of Transportation that it be allowed to sell tickets that could change in price, up or down, based on the price of oil. I would take a gamble on that. Why not take a little of the risk on myself for the chance to pay a little less? This kind of pricing scheme could help counter one of the problems with airline fuel surcharges -- we know when they go up and why, but we're not sure we can trust airlines to take the surcharge off when oil prices drop.