Allegiant drops After `60 Minutes’ report on `midair breakdowns’

WELCOMING ALLEGIANT: A fire engine shoots a stream of water into the air in celebration of the first flight of Allegiant Air to T.F. Green Airport in September. / PBN PHOTO/MICHAEL SALERNO
WELCOMING ALLEGIANT: A fire engine shoots a stream of water into the air in celebration of the first flight of Allegiant Airlines to T.F. Green Airport in September. / PBN PHOTO/MICHAEL SALERNO

NEW YORK –  The parent of Allegiant Airlines dropped following a “60 Minutes” segment detailing a high number of what the program called “midair breakdowns” at the budget carrier.

“Public documents show an alarming number of aborted takeoffs, cabin-pressure loss, emergency descents and unscheduled landings,” according to a report the CBS program aired Sunday evening.

The segment included interviews with shaken passengers and prominently featured a former member of the National Transportation Safety Board, John Goglia, who said he discourages family and friends from flying the carrier. Almost 30 percent of Allegiant’s planes are “antiquated” McDonnell-Douglas MD-80 aircraft, the program said.

Allegiant Travel Co. fell 3 percent to $146.50 at 10:43 a.m. in New York. That followed an 8.6 percent decline on April 13 in anticipation of the “60 Minutes” segment, the most since late April 2017. The slide wiped out a 6.8 percent advance this year through April 12.

- Advertisement -

“We found little in the way of incrementally negative data points concerning Allegiant’s operational challenges over the past few years,” Joseph Denardi , an analyst at Stifel Nicolaus & Co., wrote in a note to investors. “The bottom line is that, true or false, that was 30 minutes of horrible publicity for Allegiant with sound bites that will extend the story.”

Allegiant responded that it emphasizes safety, meets all federal requirements and that the “60 Minutes” report dealt with old incidents that had been investigated by the Federal Aviation Administration.

Company response

“Safety is at the core of every aspect of our operation, every day,” Eric Gust, the airline’s vice president of operations, wrote to customers. “Allegiant complies with all FAA requirements and participates in numerous voluntary safety programs to ensure we operate at the highest possible standard.”

The FAA on April 13 said it “has not identified any significant or systemic problems with Allegiant’s current operation.”

In July 2016 the agency said a safety audit at Allegiant found issues in multiple areas, including incorrect pilot-training materials and incomplete flight manuals. The FAA said none of the findings suggested inherent safety issues and declined to pursue any penalties or enforcement action.

The carrier also came under scrutiny in 2015 after a mechanical failure caused the nose of an MD-83 to rise off the ground too soon during takeoff, despite the crew’s attempts to push it down.

Tony Robinson and Mary Schlangenstein are reporters for Bloomberg News.