Topic of the Week: Frontier Shrinks Milwaukee

I know this happened a couple weeks ago, but Frontier has announced a massive cut in Milwaukee. Is this the end of the legacy Midwest operation? Will we see much remain?


14 Responses to Topic of the Week: Frontier Shrinks Milwaukee

  1. Jon says:

    It seems like Frontier was a really bad buy for Republic.

    Bad news for Milwaukee as it seems likely that Southwest will trim back Airtran’s focus there with MDW just down the road.

    Chance for DL (NWA) to make MKE a small focus again?

  2. I consider Frontier and Midwest employees to be the least lucky in the industry. A lot of bad, avoidable things happened to their companies, largely because people (both inside and outside the company) made dumb and dubious decisions.

    Midwest’s problems stem from the insanely stupid and seemingly hubristic decision of former CEO Timothy Hoeksema to fight an Airtran takeover. Imagine how much better off the Midwest employees would have been had they been Airtran employees this year! (Whether this would have been better off for Milwaukee, of course, is quite debatable, as Southwest doesn’t need Milwaukee).

    Frontier itself was mostly screwed over by outside forces instead of management failures. Their bankruptcy was essentially caused by a stupid and unexpected decision from their credit card processor to unnecessarily demand more cash holdback during the 2008-9 financial crisis. Without adequate liquidity, Frontier filed Chap. 11, and that eventually led to the Republic purchase (which they’re now trying to unwind).

    Frontier was also screwed when Southwest decided to focus their considerable resources at DEN, for reasons that are entirely debatable from a business judgment standpoint (why does DEN need Southwest if it has United and Frontier, and how successful is Southwest likely to be there?).

    I guess you could argue that the drawdown in MKE is Frontier getting “back to its roots.” My understanding is that, eventually, they’re again supposed to be an independent company based in DEN (there’s a tentative deal between Frontier pilots and Republic for Republic to sell a majority stake to so-far-unidentified and probably unknown parties). Of course, you could argue that DEN isn’t likely to be a “better” market than MKE due to Southwest’s focus in DEN. And that Frontier might not survive until that day. I’m not sure, but I am sure that Frontier/Midwest employees have the worst luck in the industry.

  3. Well you shouldn’t stick around if you can’t make a go of it and move your assests somewhere else if you can.

    Milwaukee – Branson Embraer ERJ135 replaces ERJ145, 3 weekly

    Now really to go from a 50 seat to a 37 seat jet, should you even still be in the market? They must have a contract to fly the route for a given time to do that.

  4. Eric says:

    Well said Wayne. I love MKE….the city and the airport, both are very user friendly. The MidwestExpress>Midwest model was built of meeting the O&D needs of a large-ish medium sized city that was abandoned when the legacies went to duke it out in larger, richer markets. That model worked (sort of) in the economic reality of the 1980s and most of the 90s…not so much today. The Frontier experiment built on that outdated model and added connectivity to the mix. Chamber of Commerce types predicted massive biz travel leakage from Chicagolands wealthy North $hore Kane, McHenry and Lake counties. That did not happen on the scope they anticipated.

    At the end of the day…there is no meaningful connectivity a MKE hub brings to the table that is not already in place in Denver. This drawback is noting more than a return to the original MidwestExpress roots…backfilling major business O&D markets. I hope the right-sizing of aircraft makes it viable…but given the current fuel and economic situation…I have my doubts.

  5. Sanjeev M says:

    Yes. Frontier doesn’t really need Milwaukee for they’re much better off in Denver. However, MKE hasn’t been much additional cost at outstations cause the aircraft use the same gate and employees and such. However, a route like MKE-Madison should not exist cause it’s easily driveable or bussable so I’m glad its being cut.

    Frontier has a beautiful hub operation at DEN with perfect banks (where seemingly a connection is never more than 45 min). However, to maintain a critical mass and diversify their risk, they need a second focus. With MKE all but gone, that leaves MCI or OMA. Or creation of a new base somewhere else. I would personally vouch for IND (RAH headquarters) or MEM (DL cutbacks + no Southwest yet).

    What I would also like to see is a lounge in DEN a la Best Care Club to differentiate themselves from Southwest and tack on some ancilliaries.

  6. I think Frontier’s biggest problem at MKE is the lack of proper aircraft. It’s almost impossible to fly small RJs profitably in a LCC model. The E-170s might have worked in a lower fuel cost environment, but not in this one. They’re simply too small.

    I do think Frontier will continue to fly its more established ex-Midwest routes but not much else short term. Once more E-190s arrive, their lower unit costs may make expanded Milwaukee service viable.

    A lot of Frontier’s future in Milwaukee will depend on Southwest’s moves. I feel both can survive long term if each exploits its own niche. In any event, Milwaukee’s capacity will have to get to a more sustainable level.

    While part of me is pulling for Frontier to make it as a stand alone carrier, I really wonder if a sale to United (and the attendant rationalization of Denver and Milwaukee’s capacity) wouldn’t be a better long term solution to all of this.

  7. SubwayNut says:

    Recently flew through Frontier’s Hub in Mulwaukee going from LGA-Des Moines with a 3 hour layover that became 4 because what was a completely full 37 seat E-135 for my connection to Des Moines was delayed from St. Lewis (there was one passenger who was taking both flights who stayed on the plane, the gate agents were trying to located him).

    I tried to make the most of my time there leaving security and enjoyed the little flight museum. The Frontier, former Midwest, Concourse with its large size gave me the feeling of dying hub that has lost a lot of service, or being in a hub in the middle of the night in terms of the concourses empty and very few people about.

    Frontier is an airline I really like (flown them LGA-DEN on numerous occasions always full) for years. I like the fact that I can decide when I book my ticket if I want to check bags, like on this trip when I checked my bike even free of charge (a perk exclusive to Frontier), and pay the $25-$30 immediately for a Classic Fare and get the extra free perks like the DirecTV and a seat at the front of the plane (on this flight in the first seats beyond Stretch seating, only bookable to Classic fare customers the middle seat was empty).

    I hope Denver’s Hometown Airline doesn’t die.

    • Sanjeev M says:

      This is another thing Frontier has excelled at, the segmentation of its product into Economy, Classic, and Classic Plus fares (with each level costing no more than $30 above the last)

      Of course, they haven’t really been carrying that brand message out of Colorado while Southwest’s mesage is nationwide. In fact, I’d be surprised if many people on the east coast spokes even knew who Frontier was. Social Media could help here (this is where JetBlue has excelled)

  8. PF says:

    Frontier employees rallied to stop the Southwest acquisition – I wonder how they feel now.

    • nate says:

      well after seeing how AirTran / Southwest “acquisition” is coming along, the Frontier staff should be happy. Most of them would have been stapled.

  9. Matt Sattler says:

    PF – To be honest, if DEN was going to be really profitable for SWA, they would have had to right size the operation and frankly that would have meant a LOT of job cuts to F9 employees (except the pilots who were guaranteed to be stapled to the bottom of the seniority list, but could have been furloughed eventually). It’s not a great situtation, but I honestly believe more jobs still exist @ F9 than if WN would have acquired the airline

    • A says:

      I don’t like the argument that company X employs more people because they weren’t bought out by company Y. Commerical airlines pretty much live and die by supply and demand. Having a weak F9 compete against a much healthier WN does nothing long term for employment other than delay the inevitable (for the employees) and give the customers in DEN some cheap airfares on over capacity. Airline employment long term will always revert to the balance of supply vs. demand.

      Granted, WN probably would’ve moved some office jobs from CO to TX, but it should be the state making the business climate one where any business would want to locate/remain there.

      We can Monday Morning Quarterback the whole F9 takeover history and could’ve been’s all day, but the fact will always remain that most people buy tickets on price and schedule, not hometown loyalty, nevermind that not enough people live in Colorado to keep Frontier afloat as an independant airline.

  10. The news came out the Frontier filed with the state that in November they will lay off 213 workers in MKE.

    Looks like the end will come one day for MKE being a big operation for Frontier.

  11. mick says:

    The frontier debacle really pisses me off. I fly about 4-5 times per year for leisure. Now I have to use that Zoo known as O’hare. The big B@tch I have is that Mitchell is about 5 minutes away from my house. The airline insustry with all its M&A have made it not cost effective to fly out of milwaukee. Its a pain in my AZZ. Sorry for the foul language. We need more airlines here and more competition. This city is going to turn into Detroit before all is said and done and the airline BS Doesnt help. They bought our hometown airline and then screwed us less than a year later. My middle finger to Frontiers Parent company. They just should have left it alone. Frontier is not very revered here in Milwaukee by most.

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