The next stop for Spirit’s growth train here in the US is in an unlikely place . . . Denver. Why would Spirit go into a market where there’s certainly no shortage of capacity? Something tells me that the airline wants to send Frontier a message.

Spirit will begin daily service from Denver to Ft Lauderdale and Chicago/O’Hare with twice daily service to Dallas/Ft Worth and Las Vegas. First flights are on May 3. Of all the places in the US that Spirit could tackle with its model, why go to Denver now, where three airlines continue to slug it out? It has to be at least somewhat about Frontier.

As we all know by now, Frontier wants to become an ultra low cost carrier and it has started making some big moves in its network to begin that process. While some airlines, like Allegiant, tend to stay away from competition when there are so many other opportunities out there, Spirit likes to get up in your face and let you know that it’s there to make life miserable.

Of course, this move won’t exactly make life miserable but more just be a pain in the butt. Spirit is only coming in with 1 or 2 flights a day and that’s barely going to make a ripple, but the airline is warning Frontier that it’s up for a fight. Need more proof? How about this gem in the press release from Spirit’s Chief Marketing Officer Barry Biffle (who I interviewed hear last year):

We understand that Denver has been looking for an ultra low cost carrier and we are here to satisfy that need. . . .

In other words, “Hey Frontier, this is our game. You try it, we’ll be there to fight you every inch of the way.”

So far, the two airlines seem to be taking different paths in their approach to ULCC-ness. Frontier’s new service looks more like Allegiant’s with sub-daily flights to smaller cities. But it still has its substantial existing service patterns which are more likely to overlap with Spirit.

Let’s take a look at the frequencies for this Friday in the markets that Spirit is entering:

Fares are already inexpensive thanks to the major competition, at least in some of these markets, but Spirit will still try to squeeze in below. Can it do it? Maybe, but you would think there would be better opportunity elsewhere. That’s why my guess is that Spirit wouldn’t have picked Denver next had it not been for Frontier making too much noise for Spirit to ignore.

[Original Frontier photo via Flickr user redlegsfan21/CC 2.0]

Gather ’round, kids, because it’s story time. Today, I’ll tell the story of a once bright star that burnt out quickly. But not everyone believed it burnt out – some thought that it secretly retained its glow, just waiting to be reborn. Now, 25 years later, it’s happening, well, sort of. This is the story of PEOPLExpress, an airline that had its moment in the sun but should never be relaunched. This particular new effort is really comical. If it gets off the ground, it’s going to fail miserably.

The original PEOPLExpress was started in the 1980s by Don Burr. The guy was a visionary and had the dream of building a touchy-feely kind of no-frills airline where the employees were owners and everyone loved each other (along with cheap fares). It was a big change for a guy who came from a close working relationship with Frank Lorenzo at Texas International. For awhile, it worked brilliantly. Burr opened up shop at then-empty Newark Airport and New Yorkers flocked to the airline to take them all over the US for very little cash on this egalitarian airline. Egalitarian? Yep. Seats all cost the same and you bought your ticket when on the airplane.

The idea truly was brilliant, and Burr built a heck of an airline in record time. His low fare pricing model combined with extra charges for bags, drinks, etc, was well ahead of its time. But like many good things, PEOPLExpress came to an abrupt end. The airline over-extended itself and bought a bunch of airplanes to fuel its rapid growth. It was soon flying 747s to London and looking into mergers and acquisitions. It also started to tinker with its model. The wheels started to come off quickly, though it was really revenue management that was the dagger.

When American pioneered modern revenue management, it could offer low fares to compete with PEOPLExpres (and price being similar, people chose American) while keeping some seats to sell at higher fares in order to keep its flights profitable and full. PEOPLExpress never had a chance, despite many efforts to change its model in order to survive. Just before it would have failed, it sold and was merged into Continental. It was PEOPLExpress that formed the basis for Continental’s highly profitable Newark hub today.

That airline had a mission – it saw an opportunity to bring low fares to a big city market and it was wildly successful before it strayed and failed. And now, someone wants to bring PEOPLExpress back. Will the new one live up to such a lofty and deserving mission?

No freakin’ way.

The newest incarnation of PEOPLExpress is going to be based in Newport News. That’s in southeastern Virginia. Apparently, because Southwest decided to pull AirTran out of Newport News, this new team thinks that means there’s opportunity. Yeah right. There are already two low cost airlines there – Allegiant to Orlando and Frontier with seasonal Denver service. It’s 30 miles away from Norfolk, which has Southwest, and 60 miles away from Richmond, which has JetBlue.

So where exactly is that opportunity? There really isn’t one, but just for kicks, let’s pick apart their value proposition as given on the PEOPLExpress website:

Today’s PEOPLExpress seeks to re-establish convenient nonstop service in markets that have been abandoned by other carriers, or that only offer a “commuter” service option. We also want to simplify the booking and purchase process by including baggage fees and seat assignments without piling on upgrade and ancillary fees, and by keeping our fare structure simple and understandable.

I feel like a kid in a candy store with this kind of statement. I just don’t know where to start. Let’s start with the route selection. In general, markets have been abandoned by other carriers because there isn’t enough demand. If the markets have regional jets operating, again, it’s because there isn’t enough demand for something larger. Now, there are exceptions to this rule, if airlines are willing to look at other models. Allegiant, for example, serves markets that legacy airlines simply wouldn’t be able to touch. So is PEOPLExpress looking at other models? Not really. In fact, the differences in its model versus legacy airlines is going to hinder its chances of success even further.

The airline wants to be a low fare airline (as it says in the press kit, fares will start at $69) BUT it also wants to have no fees for two checked bags or for seat assignments. So it’s going to have a low base fare and low ancillary revenue. That spells disaster.

The airline will also be using 158-seat 737-400 aircraft. That is a lot of seats to fill on flights from places like Newport News, which it is serving due to “few air traffic issues, mild climate, and favorable economic conditions.” The last one is a good reason, but the first two are just downright silly. Where else is the airline going?

PEOPLExpress plans to initially serve destinations in Florida, New England, the Great Lakes, and MidAtlantic regions. We have identified service routes through Pittsburg [sic], PA, Providence, RI, Newark, NJ and West Palm Beach, FL. Additionally, we have plans to serve Orlando, FL, Boston, MA, and many cities abandoned by other carriers. Specific route structures will be shared at a later date.

So it’s primarily short haul flying in the east, but just to clarify, those other cities are potential focus cities. Pittsburgh, for example, will start with several frequencies early on. Yeah, that makes sense. Everyone remember Skybus? It had very low fares plus a low demand hub (Columbus) and it didn’t work there. PEOPLExpress wants to do the same thing but without the ancillary revenue that Skybus generated. This all spells financial disaster on so many levels.

In fact, I see almost nothing that works here. It’s just more of the same tired, recycled ideas that many an entrepreneur has tried in the past. Those have all been followed by failure. So will this airline even get off the ground? It’s unclear.

I tried to get in touch with PEOPLExpress using the email address on the website, but I received no response.

I want to know if any funding has been secured. (I don’t believe so.) I’m also really curious to know how the airline thinks it will start flying this summer when it doesn’t even have the structure in place to try for FAA approval. Maybe it will outsource flying to another airline as you see with companies like Direct Air. But again, I received no response so I have no clue.

To sum this whole thing up, this is not a good idea at all. It’s just like many other efforts which have come and gone quickly. The only reason this one is getting more press is because it’s using a familiar name.

Update 2/20 @ 1013a: Aspire has an interview with these guys that sheds light on a lot. It looks like the money man is Bill Hambrecht, who was so enamored with his initial investment in the original PEOPLExpress (which lost a ton of money) that he threw a bunch of money away building Vanguard in its image. (Remember that mess of an airline?) Now he’s going for the trifecta.

[Photo via Wikimedia user Eduard Marmet/CC 3.0]

“Cranky Flier” Explores Decline in Small City Airline Service – Part 2 of 2 – ExpertFlyer Hot Topics
In part two of this series, I look at the government programs to help keep small service, primarily Essential Air Service. The conclusion? These aren’t going to cut it – and in fact, can do damage.

Don’t be Fooled by Hawaiian Air’s “Stellar” On-Time Performance – Conde Nast Daily Traveler
Hawaiian consistently finishes at or near the top of the on time charts, but this is really a tale of two airlines. The overwater operation isn’t so great.

In the Trenches: Working From Home with a Child – Intuit Small Business Blog
Turns out that working from home with a child is a challenge. Who knew? Hah.

We’ve had a couple of interactions with upgrades lately and more often than not, mileage upgrades are becoming less useful.

First, we had someone flying Delta to Europe. The “M” fare that Delta requires you buy to use an upgrade with SkyPesos was so high that it was only a couple hundred dollars more to buy business class on Air France. Miles were useless.

Another effort looking at United to Hawai’i showed that the co-pays were so high that the First Class fares on other airlines were actually about the same price without having to use miles.

What have your experiences been lately? Are upgrades using miles still valuable to you?

American recently decided to revamp its check-in lobby at LAX, and the result is going to be the blueprint for all of American’s hubs. American invited me to come on up and take a look last week. The highlight? The Flagship check-in service for the fancy pants travelers. I also got an update on a few other projects American is working on at LAX while I was there.

Let’s start with Flagship check-in, which is like checking in with a hotel. If you are traveling in First Class on a three-cabin airplane (either to New York or internationally), if you’re a Concierge Key member, or if you have purchased Five Star Service, you are entitled to use the Flagship check-in area which has a separate entrance directly from the curb. About 65 to 85 people per day use the service, so it’s rather exclusive. (Raquel Welch was checking in as I got my tour, so that certainly added to the glamour.)

This whole thing really does have the feel of a hotel to it. There is a doorman out front with a hotel-style bag cart. The doorman has an iPad with the list of people arriving every day so he can greet them properly.

Once inside, there are kiosks for those who want to use them, but most will just go to the hotel-style desk where an agent can help.

After checking in, the traveler walks out the door and into an elevator which goes upstairs to security. This uses the same security area as the regular premium line travelers (discussed below), but there is a separate line so people can go straight in.

Pretty fancy, huh? While it’s not easy to become Concierge Key or cheap to buy a First Class ticket, you can get Five Star Service for $125 a person ($200 for two). Is it necessary? Nah, but it does make you feel a little like a rock star.

Now, what about check in for the rest of us? As anyone who’s flown through LAX knows, the biggest challenge for check-in is that the lobby areas are pretty narrow for today’s purposes. That’s what happens when you’re in old terminals. But American has done a fairly good job at making this work after this last makeover.

The west end of the lobby (closer to the Bradley Terminal) is now all self-service.

They’ve pulled out banks of six kiosks attached to a computer where an agent is manning the operation. Everyone checks in there, and there are skycap-like runners (no tips) who take your bags to the belt. The counter itself is no longer used. By the end of 2014, there will be an in-line baggage screening area built, the counters will be removed, and bags can then be dropped right on the belt for their journey through the underbelly of the airport. At either end of the counter, there are “resolution centers” if people need help.

By the way, that inline baggage screening area will be built on the bottom floor of the new behind-security connector being built between American’s Terminal 4 and the Bradley Terminal next door. American will take 4 gates in the new Bradley concourse and people will be able to pass freely between the two. So that’s the airline’s growth plan. I asked about whether the new tunnel between Terminal 4 and 5 would ever open, and John Tiliacos, Managing Director of Los Angeles for American, said that they would like to open it up but the old tunnel has become something of a storage closet. It might take awhile before we see that happen.

The east side of the lobby has traditional counters for those who need ticketing (John said a lot of people still come to LAX to ticket, surprisingly) or have more complex issues. But the far east end of the lobby is the new premium check in area.

There is someone standing at the far end of this lobby to make sure only premium customers come in. After check in, there is an escalator there just for premium customers which takes people up to the new security checkpoint above the ticket counter so they never interact with coach passengers. (This is the checkpoint the Flagship check-in uses as well.)

All in all, I like what they’ve done with the place. The Flagship check-in piece seems particularly good for recognizing those travelers who really do spend a silly amount of money with the airline.

[See more photos of my visit]