Allegiant Air draws FAA's attention over safety concerns
Just over a year ago, Allegiant Air pilot Jason Kinzer was sitting in the cockpit of a 24-year-old McDonnell Douglas MD-80 aircraft bound for Hagerstown, Md., having just taken off from St. Petersburg, Fla.
As the plane climbed through 2,500 feet, a cabin attendant alerted Kinzer to a strong burning smell. Alarmed, Kinzer turned Allegiant Air Flight 864 back toward the airport. Fire and rescue crews met the plane on the runway as smoke wafted from an engine. Kinzer told the 144 passengers to disembark. He then helped a flight attendant carry a paraplegic passenger to the exit.
It seemed like model behavior. But Allegiant Air didn't praise Kinzer. It fired him.
In a dismissal letter, the airline called the evacuation of the plane "unwarranted" and faulted Kinzer for not "striving to preserve the Company's assets, aircraft, ground equipment, fuel and the personal time of our employees and customers." Later, the company's attorneys would call Kinzer's account an "inaccurate and self-serving recitation of events."
Kinzer's saga, now the subject of a court case in Nevada, involves one of dozens of incidents that have prompted scrutiny of the safety and maintenance practices at Allegiant Air, a low-cost airline that has found a profitable niche by serving airports in small-to-midsize cities, including Santa Rosa.
In an industry that has habitually struggled to make money, Allegiant's soaring earnings stand out. Last year, its profits jumped 154 percent, to $220.4 million, as the carrier - relying heavily on cheaper, previously used planes - flew more than 300 routes. In June, Allegiant announced a dozen new routes and three new cities, for the first time competing with major carriers at airports in Newark and Denver.
But observers with various interests and viewpoints are asking whether Allegiant has pursued fast growth and financial success at the expense of other considerations.
Unwanted attention has come from federal regulators worried about safety, investors betting against the stock, a pilots union concerned about maintenance, and corporate governance experts who fault the airline's cozy board of directors for not doing more to head off problems.
About 300 pages of Federal Aviation Administration records for Allegiant show a pattern of safety problems that have triggered a relatively large number of aborted takeoffs, emergency descents and emergency landings from Jan. 1, 2015, through this March. The Allegiant records were obtained in a Freedom of Information Act request by Robert MacArthur, owner of Alternative Research Services, a consultancy that caters to short sellers, investors who benefit when company share prices drop.
Allegiant had about nine times as many serious incidents over that period as Delta Air Lines had with similar types of planes of similar vintage - even though Delta was flying about three times as many such planes, according to a Post analysis of FAA documents of both companies.
"I don't think there's a safety problem," Allegiant's chief operating officer, Jude Bricker, said in an interview. "Our unscheduled landings in particular are a result primarily of an abundance of caution, and our pilots are entitled to put their planes into landing anytime they feel unsafe."
But leading experts said Allegiant needs to pay closer attention to its aging aircraft.
"They just have a lot of problems with leaks, doors not closing properly, things not working properly," said Mary F. Schiavo, an aviation lawyer who served as inspector general for the Department of Transportation from 1990 to 1996. "They have electrical smells every day, which means they've got old wiring. It's just kind of a poorly maintained fleet."
Allegiant said that its "safety protocols emphasize putting the safety of passengers foremost." And in July, the company said it had agreed to depart from customary practice and buy 12 new Airbus A320s for delivery by 2018.
A swift ascent
The chief executive of Allegiant Air is Maurice "Maury" J. Gallagher Jr., who ran ValuJet until one of its planes nose-dived into the Florida Everglades in 1996, killing all 110 people aboard. In 1999, after ValuJet was merged into AirTran, Gallagher started building a new carrier, Allegiant Air, which now has about 80 planes serving about 113 airports.
The Las Vegas-based company became the darling of Wall Street. It was the subject of a glowing article in Fast Company. It made Fortune's list of fastest-growing companies. Aviation Week in 2013 named it the top-performing small carrier in the world. Although the stock has lost nearly half its value since its peak of $234 a share last year, it has increased more than fivefold in the past decade.
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