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COVID 19: Allegiant Air – cash burn improves as bookings improve

Premium Analysis

Although demand in the US market continues to remain at historical lows, most of the country’s airlines are seeing some movement off the bottom, as the normally busy summer travel season is now in full swing and popular leisure destinations in Las Vegas and Orlando are starting to open up for tourists.

The US ultra low cost operator Allegiant Air, which operated approximately 70% of its original schedule in early Jun-2020, was already seeing some positive trends before the partial reopening of large leisure destinations. Generally, the company believes a solid percentage of the US population wants to travel. 

However, Allegiant is also understandably taking a cautious approach as it navigates the US slowly opening up after weeks under quarantine. Demand has risen from the bottom, but a complete rebound remains tough to predict.

As a result, Allegiant is working to rightsize its fleet, and reduce its daily cash burn. 

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