Allegiant Air’s financial losses brought on by the dramatic drop in passenger volume amid the COVID-19 pandemic will not affect its sports sponsorships.
The Las Vegas-based airline last year entered into a long-term deal with the Las Vegas Raiders to be the naming rights partner of their soon-to-be home, Allegiant Stadium.
The nearly $2 billion, 65,000-seat stadium already has a heavy Allegiant presence, with three exterior illuminated signs and one interior sign installed on the facility that will also be home to UNLV football.
Allegiant has other partnership deals with Minor League Baseball, the Indianapolis Colts and the Vegas Golden Knights, who have a branded airplane with the airline that was unveiled last year.
“Nothing is changing (as far as sports sponsorships go),” Allegiant spokeswoman Hilarie Grey said. “Of course all the venues and teams are struggling with this as well, and as partners we’re working to support each other during this time.”
Allegiant said in a filing with the Securities and Exchange Commission on Tuesday that it has experienced “unprecedented cancellations,” and last month’s revenue will be around 40 percent to 45 percent lower than it was in March 2019.
The filing also revealed nearly 700 employees “volunteered” for 60-day leave at half pay, its current daily cash burn is $2 million to $2.5 million and it applied to the U.S. Treasury Department for payroll support funds. The airline expects flying capacity for April and May to drop 80 percent to 90 percent from the same period last year, and as result it will be re-evaluating its flight schedule.
Allegiant also froze hiring for nonessential positions, suspended stock buybacks and dividends and announced a 50 percent salary cut for corporate officers.
The low-cost airline sees those sports deals as a catalyst of growth once the nation opens back up from the coronavirus shutdown most states are under, especially in its hometown.
“As we look ahead, we really see Allegiant Stadium as an important piece of the community’s future, for when travel returns,” Grey said. “Before coronavirus became an issue, we were looking at fan travel as a motivator for travel to Las Vegas. As leisure travel ramps up, we’d expect those true-blue football fans to be excited about experiencing the new stadium. We’d expect Allegiant Stadium to be one of the real accelerators for Las Vegas’ eventual rebound.”