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Allegiant Air branches out with 737 Max order

Allegiant Air has ordered 50 Boeing 737 Max aircraft, a move that will diversify, and also complicate, what is now an all-Airbus fleet.

With the purchase, Allegiant has become the first of the three primary ultralow-cost carriers in the U.S. to order Boeing planes. Like Allegiant, Spirit and Frontier currently fly fleets comprised only of Airbus narrowbodies.

Las Vegas-based Allegiant is slated to take delivery of 10 Max jets in 2023, with all 50 of the aircraft scheduled for delivery by 2025. The carrier ordered 20 Max-8 aircraft and 30 of the smaller Max-7 variant.

Allegiant also has negotiated an option with Boeing for the purchase of 50 additional Max jets.

Along with being Allegiant's first Boeing purchases, the aircraft order also diverges from carrier's practice of buying only used planes. That strategy has helped keep Allegiant's fixed costs low, thereby affording it the flexibility to aggressively scale daily aircraft utilization according to demand.

Allegiant currently flies a fleet of 35 A319s and 73 A320s.

Allegiant CEO Maurice Gallagher said that the company's approach to its fleet has always been opportunistic, and the Max acquisitions are no exception.

"While the heart of our strategy continues to center on previously owned aircraft, the infusion of up to 100 direct-from-the-manufacturer 737s will bring numerous benefits for the future -- including flexibility for capacity growth and aircraft retirements, significant environmental benefits and modern configuration and cabin features our customers will appreciate," he said.

While not detailing the price of the Max purchase, Allegiant hinted that it was able to negotiate healthy discounts from Boeing.

"The pandemic recovery cycle has brought to Allegiant unique opportunities to acquire new equipment," the company said.

Allegiant said the Max order will allow it to replace aircraft slated for retirement while pushing forward with an aggressive growth plan of more than 10% annually.

The order is the latest sign ultralow-cost carriers' bullishness for the future of short-haul leisure flying.

In November, Frontier ordered an additional 91 Airbus A321neo aircraft, giving it a total Airbus order book of 234 planes through 2029.

The November order was part of a broader purchase of 255 Airbus narrowbodies by Frontier parent Indigo Partners, which also has controlling stakes in discount carriers Volaris, Wizz Air and JetSmart.

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