Spirit and Frontier Seem to Be Up for a Fight

Frontier, Spirit

For years, Spirit has said that it has hundreds of markets it can serve profitably in the US. With so much room for it and other ultra low cost carriers to expand, it seems pretty strange that Spirit and Frontier seem to be stepping on top of each other. The latest odd battleground is… Cleveland. Can that really be the next best option for Spirit? I doubt it, especially since Frontier has already been building it up. But there has to be more than just commercial considerations here. It’s a good old-fashioned turf war. This one has to be personal.

Spirit and Frontier are Fighting

Frontier has been a frantically-busy airline this year as it works to remake its schedule to be fitting of an ultra low cost carrier. It has pulled down some Denver hub flights in favor of alternate airports like Trenton and Wilmington. But it’s more recently moved into bigger cities, cities with a void to fill.

Way back in February, soon after United de-hubbed Cleveland, Frontier decided that would be a good opportunity. Since then, it has ramped it up rapidly. It now has flights scheduled between Cleveland and Atlanta, Chicago/O’Hare, Dallas/Ft Worth, Ft Lauderdale, Ft Myers, Las Vegas, New York/LaGuardia, Orlando, Phoenix, Raleigh/Durham, Seattle, Tampa, and Washington/Dulles.

With Frontier in that market, you’d think other ultra low cost carriers would want to focus elsewhere, but that’s not happening. Spirit announced its own Cleveland service a couple weeks ago. The markets? Six of the eight sit right on top of Frontier (Dallas/Ft Worth, Ft Lauderdale, Ft Myers, Las Vegas, Orlando, and Tampa). Only Los Angeles and Myrtle Beach don’t overlap.

Is there really enough room for everyone in Cleveland? Probably not, but even if there is, it’s hard to imagine that’s the best use of an airplane. This just seems like war.

Spirit has been growing quickly, but Frontier’s schedule changes have been dizzying. The most recent strategy seems to be a move back into primary airports that it has abandoned. Even though it had previously focused on alternate airports in Wilmington and Trenton, the airline has announced it was coming back to Philly, an airport it dropped last year in favor of the other two. We’ve also seen significant new growth at Chicago/O’Hare, a Spirit focus, and the most surprising of all is the entrance into very high cost Miami. That, by the way, is an airport that Spirit has been rumored to be considering for some time. And it’s also a topic for a separate post.

With all these moves, Spirit has decided that the usual ultra low cost carrier strategy of avoiding direct ultra low cost competition won’t work. But why? Spirit clearly wants to send a message, but it seems to me that emotion is likely playing a part here.

There are a lot of familial ties between Spirit and Frontier, that’s for sure. The most obvious is in terms of ownership. Indigo Partners was the main force driving Spirit’s low cost transformation for years. But Indigo recently got out and instead bought Frontier from its former owner, Republic. So you have a new owner at Frontier that knows Spirit’s playbook. Spirit can’t like that.

But it goes deeper than that. Frontier’s President, Barry Biffle, was previously the Executive Vice President and Chief Marketing officer at Spirit (with a short stint in Latin America in between). Meanwhile Spirit’s Chief Operating Officer John Bendoraitis and Chief Financial Officer Ted Christie both had those same jobs at Frontier.

These are two airlines that know each other well and are watching their moves carefully. It’s not hard to imagine that there’s going to be a lot of emotion involved here, and that’s not a good thing. Hopefully, cooler heads prevail and some of these routes are dropped quickly if they don’t work. But hey, maybe I’m wrong and Cleveland will prove to be the epicenter of the ultra low cost carrier revolution. Yeah, that’s it.

[Original brother fighting photo via Shutterstock]

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34 comments on “Spirit and Frontier Seem to Be Up for a Fight

  1. IMO, I take the moves by these two to be just as virgin america’s and jetblue’s. The latter have moved into each other’s turf, recently. First VA’s move into BOS/JFK and JB into LAS. JFKFLL being one of those routes that JB used as a pillar when in its early stages. I think the end of these moves are to determine likelihood of combining their networks. I imagine they know that one day the low hanging fruit will be gone and as a ‘matured’ network airline they will need to look for a different way to drive growth. Will there be revenue losses, i think so. will these moves end-up in taking each other out, i don’t think so. In one end, imo, is one of them leaving some routes and staying competitive in others. On the other end, they merge their networks. VA has ops on the west and the offers technological innovations and jetblue is on the east–combined compete on the mid-level small business. Frontier has a good reputation on the west and spirit, though detested, has built operations on the east, mainly, that can go after a mix of ex-southwest (& legacy when they matched fare) travelers. though i’m not humble in my opinions here i welcome dissent, comments, and rebuttals

      1. Just saying…there seems to be a market for ULCCs and wondering why Skybus wasn’t able to make it work earlier. (Although I know Skybus had other issues – like choosing airports no one wants to fly to and lack of GDS presence that led to its downfall).

        1. as best i recall they said fuel price was the main driver. i think it as the return on their investment was so bad they’d rather shut down than continue trying to be an ULCC. I suppose that vs frontier & spirit, who also faced the fuel price spike, they were in the early stages and chose or could not rework in banckruptcy or get more investment.

        2. Sanjeev – Skybus was just too focused on Columbus and that killed them. (That and management wasn’t exactly the best.) If they hadn’t given up and had kept growing, they could have become Spirit before Spirit did its thing. They were just too early and too willing to quit.

          1. didn’t a lot of the mgt. come from southwest? at least they had airline experience but perhaps not sufficient to merit you calling them the best.

            1. IO – I was thinking more specifically about the very top. CEO/Zen Master Bill Diffenderffer was not the right person to run that airline. I mean, they just gave up in the end when they still had cash. Decided it was best to quit. But I talked to people at the airline who saw some positive signs, hoped they would keep fighting. But they didn’t.

    1. Are you banking on a draw down of service from the new American for the expansion of ULCCs at CLT? The Charlotte of today is not a great market for ULCCs (that didn’t stop Frontier from Miami). Plus I don’t think American will draw down service at Charlotte, Charlotte is extremely important for the future success of American.

      1. I agree 100% on CLT being important to the AA network post-merger. However, why is CLT not a great market for ULCC’s?

      1. The airfares at CLT are exactly why I think we’ll be seeing more ULCC activity from Charlotte. It was the 14th most expensive airport the 1st quarter of this year and I think the AA/US consolidation will welcome further expansion by F9 or an entrance by NK even though it is likely that AA will maintain CLT as a fortress hub. Charlotte has a CSA 2.5 million and a significant neighbor in Greensboro right up the road.

        http://www.rita.dot.gov/bts/airfares/programs/economics_and_finance/air_travel_price_index/html/table_10.html

        1. It will certainly be interesting to see how American/US reacts – if they do.

          Delta, which used to be the most ferocious turf defender, has scarcely said “boo” to the various infusions by Frontier and Spirit into its hubs, nor has United. The theory is that they are simply not interested in that low end market.

          American/US may be slightly less convinced at this stage of the game. They have matched – and even slightly undercut – some of Frontier’s fares on PHL-MIA, at least on the higher priced holiday dates, but not the more general very low fare days.

          1. Highly informative – I appreciate your insight. I have heard that Spirit (as well as Alaska) have been trying to get gates at SLC (DL’s western gateway, as you know) and SLC and CLT both share similar characteristics, i.e. secondary regional hubs (SLC vs. DEN and CLT vs. ATL), similar CSA population (SLC 2.35m, CLT 2.45m), and both are important financial centers, although Charlotte is far larger.

  2. Whenever I think Spirit, I think of 28″ seat pitch, and “cruel and unusual…!” I’m sure Frontier can re-size its seats to meet the competition, but I won’t be a customer.

    Then again, to each his/her own!

  3. Even though F9 is rumored to be drawing down alot of service from DEN, does anybody think that there is a market for Williston, ND to Denver (even though Minot didn’t work)?

    1. UA already has that market. Oilfield workers have to come in from much further than Denver and they like having high status on a legacy.

  4. Not to take away from the plausibility that Spirit is in attack mode against the old management that grew the ULCC model. According to OAG, United has 43.4% share of seats available at Cleveland airport. How did you arrive at the conclusion that the only airline facing competition is Frontier? No CEO could justify investor money being spent to go after a 7.4% seat share.

    It may just be that the ULCC are just capitalizing on the opportunities to lower costs where the larger carriers no longer control the gates. Maybe the city and airport authority offered incentives. Exploring new hubs was the key to success of Spirit. Nothing sinister in that.

    1. Jay F – There clearly is opportunity in Cleveland for a ULCC to move in, but it’s pretty suspicious when one goes in and another goes in on identical markets. This has to be a cat fight between ULCCs.

      1. Some think it is a retaliation by Spirit for Frontier’s big build-up at ORD – 9 routes now.

        And some think that was a (delayed) retaliation by Frontier because Spirit set up shop at DEN a couple of years ago.

        The two have been at it for some time. Frontier announced DEN-AZA and lo – Spirit announced DEN-AZA. Then they both left AZA and went back to PHX.

        And some think it is a retaliation by Spirit over MIA, which may – may – be closer to the truth.

        It was widely believed that Spirit was going to move everything from FLL to MIA and lo – Frontier jumped in first.

      2. IMO, I do think there is an element of, as you put it, ‘cat fight’; however, the top management at each of these companies have been around for some time to know how these may end-up. Therefore, I think in the end is about two combatants “feeling” each other to determine marriage potential.

  5. It seemed to me that until the F9 ownership change, F9 was focused on tertiary airports and mid-sized markets where NK was operating from larger markets and they weren’t really stepping on each others toes too much. To me it seemed there was room for both to do their thing at different airports and bring a whole new level of ULCC service across the US. With NK hitting CLE like this it seems like a turf war brewing.

    There are SO many other cities NK could have focused on but the CLE thing is a direct shot across F9’s new strategy bow. I’m sure the big boys are sitting back and watching this thing with a certain smugness….let those two piss it out while we do our thing.

    I hope for competition’s sake and the viability of both F9 and NK they reach an equilibrium. There are only so many big markets to ULCC, but there are tons of others that would welcome service from either doing their own thing. You could blame NK for upping the CLE ante, but F9 kind of did the ORD thing first and now we have all this.

    UA, AA, DL and WN aren’t gonna sweat these moves, but NK and F9 should each enter their own territories so both can continue to thrive. HEY F9 or NK, PEX is on the ropes, one of you should back of CLE and hit PHF.

  6. I bet that the main reason for this is “incentives” from the city or airport authority. It has been so painful and degrading for CLE to lose their hub that they have been desperate to attract new airlines in order to save face. If they are paying enough, it makes sense for multiple LCC’s to start service and maintain it as long as the subsidies last.

    1. I don’t think the characterization of CLE’s motive being “to save face”, is accurate. While I’m sure CLE’s pride took somewhat of a hit over the UA hub closure, I think the leadership there sees it for the opportunity that it really is and is moving to well-position the market. No doubt carriers such as NK have had CLE on their radar for some time but were turned-off by UA (in favor of other markets with one less barrier to entry). I hardly think any incentives CLE has offered these carriers were an attempt to soothe their own egos.

      1. I actually believe that most incentives offered by cities to airlines are more about civic pride than any practical economic benefits. Attracting carriers like NK and F9 is not going to bring in business travelers, conventions, or other tangible benefits. It will simply make it easier and cheaper for residents to take vacations. It’s a way of making it look like the airport is doing something about the loss of the hub.

  7. Cranky, this sounds like MKE all over again- except instead of AirTran it’s Spirit. I realize that CLE is a bit of a bigger market but it seems like we know how this story will end. Thoughts?

    1. bobsmith99 – That was a totally different Frontier back then. That was Frontier effectively trying to swallow Midwest and maintain the Milwaukee presence. This one is more proactive. I tend to think there is opportunity in Cleveland, but I’m just not sure that there’s enough for these guys to both fight for it on the same routes.

      1. Ah, fair point- Frontier definitely isn’t trying to make Cleveland a hub. At any rate, it’ll be interesting to see how it turns out- good news for Hopkins passengers in the short term.

  8. Both of these are so foul it is unbelievable. I really try to avoid them. I’m certain there are some worse… in some third world country but I can’t think of one now.

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