Topic of the Week: Will Frontier Succeed?

You’ve see two in-depth posts talking about Frontier’s future this week, and Indigo has now confirmed that the purchase will go through. So now it’s your turn. Is Frontier going to succeed as the next successful ultra low-cost carrier?

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33 Comments on "Topic of the Week: Will Frontier Succeed?"

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JRS
Guest

Allegiant and Spirit have been a success, is there room enough for a third ultra low-cost carrier? I think there is and hope so, my local small (Lansing, Mich.) airport will have Frontier flying for Apple Vacations starting in January.

James Burke
Guest
I think they will. Their business model is still kinda wacky – almost like different companies on the east and west coasts. TTN and ILG seem like they are working well, and maybe they can add some similar type airports (I was thinking maybe Newport News would be better off hitching their wagon to F9 rather than the peoplExpress reincarnation). Frontier has a better reputation than Spirit or Allegiant. I think they could be succesful. I hope they are… They have to get costs to where Spirit is, so let’s see if they can do it in such a way… Read more »
David SF eastbay
Member

I did see something yesterday that was positive about their Trenton and Wilmington operations, so if they keep it up, they could do ok. As long as they don’t sink to operations like Skybus which was doomed from the start, they have a chance.

Len
Guest
I was impressed with the level of candor and detail of the answers to Cranky’s questions. Sounds to me there are some brains behind the operation. I’ve never had a bad experience on Frontier, and personally wish them well. From a marketing perspective, I see ways Frontier can set itself apart from the Allegiants and the Spirits of the world. If they can do that and make a buck, I think they’ll be fine. Look at the near-term future of jet fuel prices -I hope they use a smart hedging strategy. There is money to be saved in the fuel… Read more »
R Steinmetz
Guest

Frontier has the advantage of being ULCC 2.0. The new owners have the benefit of all of the wrong things Spirit did and hopefully will adjust the business model to avoid the animosity those steps created while maintaining the profitibility.

DesertGhost
Guest

I see no reason why Frontier can’t be quite successful. Bill Franke and Indigo Partners seemed to do quite well with Spirit, so there’s no logical reason to believe they can’t duplicate that success.

esw
Member
How well F9 can make DEN work, provided F9 is serious about that, is a key factor. F9’s brand loyalty was always primarily restricted to DEN, and now even that is not what is was pre-Republic. With further changes to its business model, F9 will tend to lose some of its most loyal and lucrative customers. With whom will F9 replace them, and on what basis will it appeal to them? DEN does not have the destination appeal of LAS, so there are not as many small market opportunities for F9 in DEN as there are for G4 in LAS.… Read more »
Davywavy
Member
90% of Frontier’s business is at DEN and Frontier made a $30 million contribution to Republic’s earnings in the just announced Q3 results. So I guess DEN is working pretty well for Frontier – despite the Conventional Wisdom that it cannot succeed at DEN up against United and Southwest. It is also hard for me to to imagine how Southwest can be any more aggressive. Ever since its failed bid for Frontier at the 20089 auction, the Southwest attitude to Frontier, at DEN, has been pretty much scorched earth. Indigo, the new owner, has confirmed the commitment to DEN and… Read more »
esw
Member
Davywavy – The question is, when F9 changes its business model, what else (including its DEN profitability) will change? Our assumption is that the new brand will no longer be as relevant to a large percentage of F9’s most profitable DEN customers, calling into question its viability at DEN unless it can replace them effectively with new, profitable customers. We’re not saying they can’t – we’re just unclear on who they’ll be or where they’ll get them. Of course, if F9’s most profitable DEN customers remain loyal to the brand even after the evolution to ULCC, then these questions are… Read more »
Davywavy
Member
But the business model is already changed. From a passenger perspective, Frontier is already – and has been for some time – a ULCC, and in 2012 was full-year profitable for the first time since 2003. nb: it was not cash positive that year – forward payments on the Airbus Neo ordered sucked out about $30 million. The profit centre is DEN, at least for most of the year, Q1 is still a drag. I’ve no idea if they are Frontier loyalists who have stuck with the airline thru’ thick and thin, because a very great number of those had… Read more »
A
Guest
ULCC’s are for the leisure traveler, i.e. the most price sensitive customer. I go back to the comment I made the other day. For them to succeed they have to be the cheapest option – bar none – including the fees that level the field against the legacies. If you can constantly count on F9 being $100 or $50 cheaper than the DL, UA, AA guys than you’ve got something with traction. The closer that fare difference gets to par the less of a future you’ve got because you aren’t going to beat the legacies at their own game.
Nick Barnard
Member

But part of aiming at the leisure traveler is that they’re not as aggressive at comparing all the options.

ULCCs will have a bit of a struggle if the online sellers ever figure out how to show 3 people+2 bags+5 drinks in their pricing grids online.

jaybru
Member
Will Frontier succeed? It’s branding, coding itself F9, is a huge turnoff for me. How many people know that F9 is Frontier? I’ll bet many, many travel agents have no idea what F9 is. Now, branding on its planes, that’s well done. How could you possibly not know which is a Froniter plane. But, honestly, why would any airline want to have F9 as a code to describe its company? Alllegiant, G4, is also a joke. What, pray tell, makes one think of an airline, Allegiant when seeing G4. Of course, Allegiant flights don’t get listed in the Pocket Guide… Read more »
james
Guest

I really don’t think the average traveling public knows or cares.

It’s like having the original area code in your city. It’s more desirable, but no normal person would think less of you without it.

esw
Member

What? Did you never watch the movie Swingers????

David M
Guest
Are we really thinking that airlines will succeed or fail based on their IATA code? With only two alpha-numerics to work with, there are bound to be plenty of codes that don’t have an obvious relationship to the airline’s name. Most passengers shouldn’t be seeing the codes until after they book anyway. If a travel agent doesn’t recognize a particular code for an airline common to their area, they’re not a really good travel agent, anyway. A Denver agent who doesn’t know who F9 is really ought to be finding another job. A Taipei agent might not, but it’s also… Read more »
james
Guest

Also, F9 or airline codes are not used as branding. Southwest’s “LUV”, Frontier’s Animals, United’s “Friendly Skies” revival are all branding strategies.

But, I do agree Spirit’s is completely wrong. Perhaps we could lobby to have it changed to “FU”, would be more apropos.

robertmilton747
Member

I truly miss the so many of the legendary airlines. The last two to go were Northwest and Continental Airlines. What a tragic merger story. What! For the likes of Delta and United! Yikes!! Frontier, Allegiant, and Spirit….truly “garbage” air carriers. No class, style, or substance.

Michael
Guest

If Frontier can supply a high level of customer service, I think they can succeed, especially given the Denver market controlled by Southwest and United. Their fares will have to come down, though, since they’re typically on par with Southwest.

Unfortunately, Frontier’s road to ULCC has negatively impacted their customer service, especially turning off their frequently flyers. Despite being a Summit flyer on Frontier, I started flying Southwest.

pilotaaron1
Guest
I honestly think they will. I often wonder what was said when jetBlue presented their business idea. At the time it was unique and it has worked really well for them. Sure there have been a few hiccups along the way but they have done well. Frontier’s idea is ULCC with a little twist. I like that and think they will do very well. And man did Trenton work out for them and they are still the only ones at the airport. I wish them the best. It shows that there is a place in this industry for innovation and… Read more »
yo
Guest

They will do OK. But I pity anyone that has to work with that demon Bill Franke…

Paul Ferdinand
Member
There’s plenty of room in the US for another low fare carrier. Living in Philly I’d say Trenton is a good idea if for no other reason than convenience. They just need a reliable link to the nearby Trenton train station which has LOT’S of service. It is a traffic disaster from northern burbs of Philly to PHL. Most would rather avoid Newark. I don’t understand Wilmington as the airport isn’t all that convenient. Others have tried there without any luck. When I was a Sales Manager in the Travel Industry the joke with local travel agents used to be… Read more »
astra
Guest

Cranky, in DEN, Southwest seems content to match F9’s fares, even when Frontier announces a sale. How can any ULCC compete when you have a gorilla like WN simply equalizing their fares every time F9 tries to gain a discount advantage?

ChuckMO
Guest

F9 is getting away from direct competition with WN and UA will feel the pain I think, the F9 of right now will be VERY different in two years.

ANCJason
Guest

I don’t think the question is whether they will survive under Indigo. I think the real question is what remnants of their former self will be prevalent after being morphed into Spirit’s network in a few years.

Johann Trim
Guest
I am a Denver-ite of many years and was Summit level on Frontier for 5 of the last 10 years. In 2011 I made the decision to go with Southwest for my business travel for a number of reasons. First and foremost, Frontier has started to “Play games” like the big boys. Boarding preference, carry on BS, lower fares for shit service. At least with Southwest and my AList Preferred status, I know what I am getting every time. It is consistently a high quality product despite the “cattle call.” Last week I took a DEN->DFW->DEN day trip on Frontier,… Read more »
Davywavy
Member

I guess it takes all sorts. This came out a couple of days ago:

http://www.latimes.com/travel/deals/la-trb-study-ranks-frontier-no-1-airline-20131106,0,2955931.story#axzz2k59PCLbo

[i]”Frontier No. 1 in airline ranking

Frontier, Virgin America and JetBlue came in 1, 2 and 3 respectively in an annual Airfarewatchdog.com ranking that factors in such elements as customer service, on-time arrivals and baggage handling.”[/i]

Johann Trim
Guest
Yeah I saw this too, perplexing to me. Maybe the cheapness of the fares was a bigger influence here? Frontier is *definitely* cheap, consistently cheaper than Southwest on every single segment I fly. Still, the absence of things like Wifi means they are a hard sell for me on anything but a really short flight. I think they need to rip those TVs out and get wifi, maybe go for a premium cabin (I think Jetblue is doing this too) – revamp their rewards program, etc. Myself and a lot of other business travelers pay for the premium experience, and… Read more »
Davywavy
Member

The tv’s are eventually going – the new A320 will not have them installed, but I don’t know if they have decided on which Wifi system yet.

I doubt a premium cabin will happen because Frontier is going for the ULCC model, and I think your issue with the airline is in your comment on your “A List Preferred Status.”

The ULCC model isn’t designed for people who prize that that status. It is designed for people who want low fares, and that has been the reason for the turnaround in Frontier’s financial fortunes.

Johann Trim
Guest

Yep, no doubt. I could care less about the fare as long as the plane is safe and the seat is comfortable. I actually don’t care about the status either – it just helps get around the open seating at Southwest. I actually think that anyone who is truly espousing the ULCC model as a company should think about open seating as well. Having flown Southwest and the competition over the years, seats are responsible for a lot of delays, hassle, more need for IT and automation, all kinds of bad stuff.

Bill W
Guest
I have been flying for over 44 years, and I am not alone in saying Frontier has the WORST performance and customer service of any airline I’ve used. Even Hughes Air Worst in the seventies was orders of magnitude better than Frontier. I for one think Frontier should go bankrupt tomorrow. This “ULCC” concept is very bad news for the consumer. I miss the old days when flying wasn’t about getting charged extra for every little thing, and the airlines actually cared about the passengers. Based on the reviews Frontier is getting from the flying public, they will run out… Read more »
Davywavy
Member

“This “ULCC” concept is very bad news for the consumer”

It is very good news for some consumers. The ULCC’s – Ryanair, Allegiant and Spirit – are some of the most profitable airlines in the world, and – happily – Frontier is now making money again. Spirit has some of the highest margins in the business:

http://www.fool.com/investing/general/2013/11/02/spirit-airlines-profit-soars-shareholders-shrug.aspx

“On Wednesday, Spirit Airlines (NASDAQ: SAVE ) reported a record quarterly profit, as its already strong margins soared to stratospheric levels.”

It isn’t for you? Fine – It is called choice, and I wonder what the problem with that is?

DCAfficionado
Guest
I’m with Davywavy on this, whatever the profitability of other low-cost carriers, as a former Midwest/Midwest Express customer with more than 80k miles now on Frontier, I have watched exceptional customer service degraded to requiring HOURS (not exaggerated) on the phone waiting for Early Returns customer service, elimination of the route I flew most and a single daily flight to either alternative destination, a terminally clunky website and fees for phone reservations, a broken seat up-front that was mine and gate staff who insisted I sit in row 15 when I asked for the next seat upfront (there were many… Read more »
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