Frontier’s New Pricing Structure Looks a Lot Like Spirit’s, But There Are Differences

We’ve been talking about Frontier’s transformation into an ultra low cost carrier (ULCC) for a long time here, but now that the airline is under new management, the transition has been speeding up. Last week, Frontier made a big change to its pricing structure. It looks pretty similar to what Spirit has done, and that’s no surprise since Frontier’s new owners happen to be Spirit’s old owners. But there are some differences between the two.

Frontier ULCC Transformation

Frontier used to have four fare tiers. Basic and Economy were the same except Economy was sold directly through Frontier and Basic was sold through travel agents. Fares were just about identical but the Basic fares were stripped of some benefits, including the right to a free carry-on bag. The next one up was Classic, which had some extra benefits included. Then Classic Plus was at the top with fully refundable fares, more legroom seats, etc. Now, only the Economy and Classic Plus fares remain.

Taking a page out of Spirit’s book, Frontier lowered its Economy fares on average by 12 percent (at least, that’s what the press release says), and then unbundled everything. Carry-on bags that don’t fit under the seat in front of you will cost $25. Basic seat assignments start at $3 and go up depending upon distance or type of seat.

Then, echoing Spirit, Frontier has created the Discount Den. You’ll pay a certain amount (not sure how much since charges don’t start until June 2015) and you’ll get discounts on things like carry-on and checked bags. If this sounds like Spirit’s $9 Fare Club, it’s because it’s very similar.

You might be wondering what this move has to do with being an ultra low COST carrier. After all, this is a revenue change, not a cost change, right? Not exactly. Some of these fees will help to lower costs. When you start charging for soda, for example, people won’t drink nearly as much as when it’s free. So the airline can stock fewer drinks and save money. By charging for all bags, they encourage people to pack lighter. Fewer bags mean less weight on the airplane and lower fuel burn.

But back to the details. How is this different than what Spirit does?

There Will Still Be a Traditional Bundled Fare
Unlike at Spirit, you will still have the option of buying a bundled fare on Frontier. The Classic Plus fare looks to be running about $75 to $100 more than the Economy Fare in each direction. That includes one checked bag and one carry-on bag (makes up $50 right there). It also includes seating in Stretch, the extra legroom section. One alcoholic drink is free and all non-alcoholic ones are included. Fares are fully refundable and changeable without a fee. Oh, and you get priority check in, security, and boarding.

You Can Pay for Extra Legroom
Sure, Spirit has its Big Front Seat which is a First Class-style seat in the front row of the aircraft. But Frontier has a more traditional extra legroom section in coach, similar to Economy Plus on United. It starts at $15 above the base fare. (It’s included in the Classic Plus fare.)

There is An Elite Frequent Flier Program
The Frontier EarlyReturns program still has an elite frequent flier program, and the benefits are even greater than before because it includes things like two free checked bags, a free carry-on, and priority check-in/security/boarding. (It always included those things, but now nobody else gets a free bag on an Economy fare.)

In short, the basics are effectively the same. Frontier, like Spirit, wants to lower fares and charge extra for everything. It’s a model that works. But Frontier seems to at least have softened the edges a little bit with things like extra legroom seats and an option for a bundled fare.

Long time Frontier fans probably won’t like this change, but it’s the right move for the airline. If it had kept going the way it was previously, it would be out of business by now.

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