Spirit Does Its Best AirTran Impersonation

Aug 1, 2016

More Reading on This Topic: AirTran, Spirit

When Bob Fornaro took over as President and CEO of Spirit earlier this year, we knew there would be changes to the airline. What we didn’t know was to what extent Bob would be channeling his former employer, AirTran. The answer: a lot.

AirTran Spirit Scooby Doo

Up until recently, Spirit had really focused a great deal on building opportunities in big cities. It had its huge build-up at Dallas/Ft Worth. It was growing at Chicago/O’Hare, Houston/Intercontinental, Atlanta, you name it. It usually went in with at least daily flights (if not multiple daily) in a market, and it tried to skim passengers off of other more expensive airlines.

There’s no doubt it hasn’t given up on those types of markets, but if you look at the new flights announced this past month, it shows a very different pattern. Spirit has announced it will bulk up in three places: Baltimore, Orlando, and Akron/Canton.

Those sound like wildly unrelated markets, but let me refresh your memory a little bit. I couldn’t find anything more recent, but thanks to Chris Sloan from AirwaysMag.com, I was able to get my hands on this 2006 route map. (Here’s one built by Anna.aero as well.)

AirTran Route Map

We all know that AirTran was huge in Atlanta, but once you got beyond, Orlando and Baltimore were both major focus cities. And Akron/Canton? It wasn’t large enough to be a true focus city, but it punched well above its weight with a lot of profitable service. Even though this is from 2006, the status of those cities didn’t change up until Southwest took over. And then what did Southwest do?

Well in Orlando, Southwest slashed and burned since AirTran had a lot of sub-daily flights from there to a variety of markets. Spirit isn’t going back into those exact same markets here, but it has launched five more this month with single daily flights in each.

Orlando to Boston is a market that JetBlue flies a lot and Delta flies once a day. There are a lot of people connecting in that market, and Spirit sees opportunity.
Orlando to Philly is served by American and Southwest frequently and even Frontier is in that market. That seems like a lot of airlines duking it out, but apparently there’s room for one more.
Orlando to Kansas City is a Southwest market through and through with up to 4 a day. Spirit should have no trouble skimming with low fares.
Orlando to Niagara Falls and Plattsburgh are Allegiant-style markets. In fact, Allegiant serves both from Orlando/Sanford. Niagara Falls = South Toronto and Plattsburgh = South Montreal.

In Baltimore, Spirit has quietly built up to have 14 nonstop destinations. Three were added earlier this year (Boston, Detroit, and Orlando), and now it’s time for some winter flying with both Ft Myers and Tampa coming on once daily.

Then there’s the mighty CAK (that’s Akron/Canton’s airport code). This was a rock star market for AirTran, but once Southwest moved in, it all but walked away. Now, Southwest has dropped CAK down to having year-round service only to Atlanta (itself a hub that Southwest dramatically shrunk). It also has seasonal Orlando service.

Seeing this, Spirit will be moving in. There will be one daily flight to both Ft Lauderdale and Orlando. Tampa (3x weekly) and Ft Myers (4x weekly) will get seasonal winter service. And in the summer, CAK gets a daily flight to Myrtle Beach.

All of this smells like one thing. Bob Fornaro sees opportunity from his previous life. It’s not a carbon copy of AirTran. It’s more like a dog that knows which part of the yard it likes to sniff in. It might find something different each time it goes there, but it knows there’s something good to be found.

Brett

16 responses to “Spirit Does Its Best AirTran Impersonation”

IO

Aug 1, 2016 at 5:26 am

maybe i look too much at the woods and miss the forest. Great view you provided in this post CF.

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IO

Aug 1, 2016 at 5:35 am

something that occurred to me while reading your post is the effect it will have on any combination that maybe in the future with frontier. growth in places where they can butt heads less. And, relatedly how will the “big boys, including SW” react to this moves as they’ve moved to offer bare bones service themselves.

imo, spirit will be able to be less bothered by the “big boys” since it picks heavily traveled routes and non-hub/focus cities primary airports (i.e. dca, cle). i see sw more heavily impacted.

so a hybrid airline. i’d say it doesn’t have much of a chance but knowing how airtran had success with this strategy i’d say there’s room to be successful and for investors to make money. just my opinion, though as i’m not a financial planner or a trader.

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A

Aug 1, 2016 at 5:41 am

I’m more interested in why WN abandoned a lot of the network that Airtran had built up. So far as I can tell they [AirTran] were successful with many of those routes. Was the Southwest 737 just too big for a lot of the Airtran legacy routes? If that’s the case if Spirit throws an A320 on it would it not fail for similar reasons? I think it’s fair to say WN wouldn’t walk away from a profitable route out of spite. It’ll be interesting to see if Spirit can re-create past magic…

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1. Andy
  
  Aug 1, 2016 at 7:53 am
  
  Spirit has a much larger focus on once a day service than Southwest. Southwest will tend to have multiple flights to a spoke, while Spirit is fine having only one flight in a market. This can make it harder for Spirit passengers when irops occur, but their target demographics tend to be willing to put up with that because they are driven more by cost than convenience. This allows Spirit to work in smaller markets that can’t sustain 4 737’s per day, but can fill a single A320.
  
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2. Noah Kimmel
  
  Aug 1, 2016 at 8:15 am
  
  southwest also has a few other quirks that may be more impactful than “spite”:
  1) costs are higher. Staff makes more money, which means profit targets and expectations must be higher for routes to stay in the network. Also the loss of the 717.
  2) different network – given other connecting opportunities, it may not make sense to flow over ATL for instance, if Southwest already can do that over BWI. Once you start peeling away that traffic, then whole routes can quickly lose profitability
  3) Technology – Southwest’s IT system makes it very hard to schedule less than daily service
  4) Airtran loyalty and distribution – it is possible (and I have no data to prove) that people found AirTran via GDS or OTA and won’t find Southwest. Even if it is 1%, that can quickly kill traffic
  
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3. crankyflier
  
  Aug 1, 2016 at 8:17 pm
  
  A – I think Andy and Noah both gave plenty to chew on, and I’ll add one more thing. These aren’t exact replacements of the routes Southwest abandoned, for the most part. These are just coming from the places where AirTran used to focus. But for some that do look like the days of old, like Akron to Florida, I think Noah’s third point is the key. As we all know a million times over, Southwest’s technology sucks and it is hamstrung to be able to run a schedule that makes sense in some of these kinds of markets.
  
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4. dee
  
  Aug 2, 2016 at 8:57 am
  
  AirTran had 737’s also on those routes
  
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drybean

Aug 1, 2016 at 6:54 am

I wonder of Spirit will enter more G4 type markets. Allegiant has capriciously entered and exited so many markets there must be a strong demand in lots of cities left without air service to Vegas, Sanford, and other G4 destinations.

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David SF eastbay

Aug 1, 2016 at 7:53 am

How funny, I was just looking at the Spirit and Allegiant route maps this weekend and was thinking how much Spirit has moved beyond it’s east coast ‘everything needs to go to/from FLL’ service. They are all over the map with point to point service and focus cities with FLL as only a place to go to get to the Caribbean and Latin America.

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Rsteinmetz70112

Aug 1, 2016 at 8:26 am

Spirit has also noticeably softened its attitude and improved operations. Perhaps Spirit needed to be aggressive while introducing the ULCC model but that time has passed. Frontier has shown the way to a kinder gentler ULCC.

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Noah Kimmel

Aug 1, 2016 at 11:26 am

How much does a CEO impact route selection? I would have thought there is a lot of data and science to balance feelings. Given Spirit’s reputation and the time since AirTran was a major force, I wonder if the markets will materialize as Bob expects. Or is this “old thinking”….

I certainly like the friendlier service goal. Bare bones products do not mean crappy service, just ask IKEA. I do think Ben Baldanza liked the publicity of poor service as it reinforced his “cheap” brand. Now with more ULCC competition and name recognition, service becomes more important

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1. crankyflier
  
  Aug 1, 2016 at 8:19 pm
  
  Noah – Well in the case of Jeff Smisek, a whole lot. Right, Columbia? ;)
  
  In this case, my assumption is that Bob just started creating focal points, like Orlando, and had his team do the work to figure out which routes make sense. But some people, network planning never gets out of the blood and they meddle even at the top of the pile.
  
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  1. Noah Kimmel
    
    Aug 2, 2016 at 4:35 am
    
    Hah! Though that didn’t exactly work out well for him…
    
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Tim Dunn

Aug 2, 2016 at 6:48 am

CAK, while a relatively small city, is in the middle of the fairly densely populated industrial Midwest where ultra low fares can pull passengers from a lot of other cities without going directly against other airlines for whom CAK is just a spoke.

BWI is a low cost carrier airport but Spirit has fares and costs that are well below Southwest’s. Undoubtedly part of the reason why WN bought FL was to get rid of FL as a lower cost competitor in multiple major WN markets including MDW and BWI. BWI benefits geographically from the same ability to pull traffic from a large catchment area. People are willing to drive long distances for very low fares.

Orlando has more consistent year-round demand than FLL and there is still more than enough room to grow. Focus cities/hubs in both Central and S. Florida make sense for a leisure oriented airline.

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RBY

Aug 3, 2016 at 9:22 am

“Orlando to Niagara Falls and Plattsburgh are Allegiant-style markets. In fact, Allegiant serves both from Orlando/Sanford. Niagara Falls = South Toronto and Plattsburgh = South Montreal.” They were also Airtran-style markets before the J7 merger. And btw WN does not, contrary to popular belief, have hubs. WN has a point-to-point network and the schedule is different given the day. Some flights do not operate daily.

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Bill from DC

Aug 4, 2016 at 12:26 pm

Differences with CAK now and then…

CLE was essentially a fortress hub for United. FL served markets from CAK such as LGA, Boston and the DC area, peeling off budget conscious business travelers from CLE.

CLE has much more low fare competition now including Spirit flights to many of these same destinations, B6 flights to Boston and FLL, etc. Not sure I see this new CAK service as much more than the continuation of Spirit’s buildup in CLE and NE Ohio in general.

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