Sun Country Grows Every Which Way

In recent history, Sun Country has been an afterthought. It was a small airline that during the best of times was marginally profitable. It focused almost entirely on flying people from Minneapolis to… everywhere. Things have been slowly changing under new leader Jude Bricker. We’ve heard Jude talk about what he wants to do, but now we’re seeing the network strategy really ramp up. “Strategy” may be a loose word. The airline’s strategy appears to be looking for any random opportunity that nobody else is taking.

In a recent article about Sun Country, Skift lays out the vision for the airline. This squares with what Jude has said about the airline since he took over. He wants it to be chasing highly-seasonal demand on a variety of routes. If you’re looking for a long-term, coherent network strategy, you won’t find it. Airplanes will move with the seasons, or as I described it last year

But how has this played out? Well, there’s certainly a big difference in the network by seasons. That, however, has historically always been the case with Sun Country. During the winter, the network focused on north/south from Minneapolis down to warm weather spots. During the summer, it morphed into more of an east-west network going to big tourist spots.

That basic idea still seems to be in place, but it has now expanded far beyond Minneapolis. Let’s start with a look at the first big schedule that went into place under Jude. Here are the routes that were announced as new for the spring/summer of 2018.

Jude had said previously he wanted to become a “spill” carrier, basically skimming the passengers that other airlines wouldn’t carry because they were full of higher fares. That’s not something that has historically been a profitable venture for any airline. (When demand tanks, there’s very little demand left to spill.) But for now, it’s a strategy that can work on some routes.

Routes, for example, like Seattle to Anchorage and LA to Honolulu are bottomless pits during the summer. And the rest of these are more popular summer routes as well. I get it.

But now let’s move into what was launched in the fall/winter schedule of 2018/2019. Here that is:

As you can see, this map is far more north/south in nature. There’s a lot of Florida along with the desert Southwest. But what you also see here is the addition of a couple of new focus cities beyond Minneapolis to the network. Nashville and Portland in particular stand out as new spots where Sun Country wants to focus. In the winter, these cities still get routes that warm people up, following the demand. It’s not like Sun Country is hiding this fact. Just look at the headlines on two press releases about those cities.

But that was winter. Now it’s time to look at the upcoming spring and summer, so let’s see what new routes Sun Country recently announced for that.

Apparently (and unsurprisingly), Anchorage and Honolulu worked to the point where they get new origin cities this summer. Those are still spill markets. And Sun Country seems to think there’s a lot more spill opportunity in Minneapolis as well. Look at markets like Philly, Newark, and Chicago. These are big markets with multiple airlines already in them. In the winter, this would be a bad move for Sun Country because there’s too much capacity in the back of the bus. But in the summer? All those Minnesota families that want to go somewhere on vacation can do it for cheaper than on the other airlines.

But as much as Jude likes to talk about being a spill carrier, there are routes in here that don’t fit that model at all. A lot of these appear to be very similar to what Frontier and Allegiant have been doing recently, connecting mid-size markets that don’t have service today. Think about places like Nashville to Providence and Portland. Or Portland to San Antonio. What’s that all about?

It certainly contradicts what Jude said in that Skift article. He was quoted as saying, “We would go and do what Spirit and Frontier have already done, but they are already doing it.” It seems a more accurate quote would add,”…but if those airlines miss a spot, we won’t hesitate to try it out.”

So what is the overall strategy? It seems to be one of just pure opportunism. Right now, that’s a winner because demand is robust and opportunities abound. But what happens when the economy goes down and demand falls? Considering how spill carriers have fared previously, I remain concerned. The one thing Sun Country has going for it is that it can move airplanes and switch routes very quickly, far better than airlines in the past who have tried this strategy. It’s just not clear how many places can provide a profitable home for those airplanes when things get ugly. That will be the true test of whether this model is sustainable or not.

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28 Responses to Sun Country Grows Every Which Way

  1. Matt D says:

    Sarcasm and satire is an art. And you sir, have penned a masterpiece today. The subject is almost irrelevant here. Your prose here is entertaining in its own right. One of your best pieces ever.

    Love it. Maybe you should call them “Vulture Air”.

  2. Logan says:

    You forgot STL-PDX on the final map

  3. Carter says:

    I’ve never flown Sun Country before because of where I live but I’m taking advantage of their nonstop MSN-TPA in March. Even with purchasing a carry-on AND upgrading to their new “Best” seat, the ticket was over $50 less than other airlines’ basic economy with connections.

    I keep combing the internet to see if there are any trip reviews of the new “Best” seat product before I travel. Cracky, maybe that could be a trip report for you this summer. They have a LAX-BNA flight!

    • CF says:

      Carter – We actually have someone booked on Cranky Concierge for a meeting we’re having in May, so I’ll see if he can report back. Also, I’m considering fly SY to Hawai’i this summer just to try them out. We’ll see.

  4. Ben says:

    Do you predict Sun Country will survive Moxy? Neeleman v Jude? Who wins? Neeleman v Ditka? Who wins? ;)

    • CF says:

      Ben – I don’t think there’s much overlap between Sun Country and what Moxy is thinking of doing, but I suppose we’ll find out when it actually happens.

  5. BSOD says:

    Sun Country has a niche but they have a ton of work to do with the Land of Sky Blue Waters to get respect back. Their transition from a full flavor airline to airline light has a painful list of bodies at MSP, including their own ground staff (got axed because they cost too much, got replaced, but the replacement contractor couldn’t provide the staff and they got axed, another contractor was brought in and the replacement to the replacement failed, so they are hiring their own staff again) and their customers, like yours truly. They have so many advantages here at MSP, Terminal 2 is a gem and yet they keep screwing groups over, be it customers (oops, ran out of planes) or ground staff (be careful with that axe, Eugene) or their own employees. Since they can’t get their pack straight, people like me have switched to the smooth, full flavored taste of Delta (cough, cough).

    • A says:

      I’m not sure that SY sees MSP as their bread & butter like they did previously. Sure, they were a nice alternative to DL when they were a full service airline but that certainly didn’t bring them riches, and a metro of 3 million and catchment of +/-5 million isn’t really going to support a big airline, at least one that can go head to head with Delta. I’m ok with the ULCC approach, even if I doubt I’ll fly them. There’s a market for that and exploit it where you can.

      • Sean S. says:

        Except that MSP is still the largest hub they have, and clearly this recent route expansion and announcement of a hiring spree in the MSP area indicates that there is substantial room for growth in MSP. As you mentioned it’s catchment area is much larger than the metro area, and it’s location makes it unique for many of the rural states next to it, including as far west as Idaho. While Delta is dominant certainly, I’ve always imagined that MSP could become the hub for multiple airlines comfortably by virtue of serving the unique markets that it is well positioned to serve.

  6. Nathan says:

    If Sun Country operated Airbus equipment, I am sure that either Spirit or Frontier would have bought them by now. Without any key airport gate/slot holdings (like Airtran) I don’t see any reason for another airline to consider any form of partnership.
    Is there any growth planned, or is Sun Country simply trying to deploy its fleet as profitably as possible?

    • A says:

      I don’t think there is much historical precedent for aircraft type playing into mergers and acquisitions of airlines. Most recently the AS/VX tie-up. As far as I know the SY planes are leased anyway.

  7. Chris says:

    The piece didn’t mention any charter work and I wonder if that is a significant amount of their flying? We saw Sun Country a few times at SRQ this past fall, shuttling gamblers to Gulfport…not sure how good the loads were…

    • CF says:

      Chris – On charters, loads don’t matter. They’re getting paid either way, presumably. Charter has always been a big part of the business, but I would imagine it’s going to be less important in the future. It clearly wasn’t making them hugely profitable before.

  8. Spacie says:

    Aren’t there easier ways to make money?

    Like, jokes aside, unless you’re really attempting something disruptive; filling an unmet market niche, why run a marginal airline?

    • CF says:

      Spacie – I think the problem is that Sun Country exists and has airplanes, so it has to do something. I can’t imagine any of these people would have started up Sun Country with this business plan. But the airline exists, so what’s the best you can do? This probably seems like the best possible plan at this moment.

      • Oliver says:

        The fact that Sun Country existed and had airplanes didn’t force its current owners to buy it, though. They must have thought that the price they paid was a good investment… and better than alternatives.

  9. Matt D says:

    This reads an awful like the final chapter of Reno Air.

    In the beginning, they set up the Reno Hub.

    Then, they took over a lot of the SJC flying that American inherited from AirCal and couldn’t make it work.

    Apparently neither could Reno. Their last two years or so saw them running all kinds of off the wall routes. Like LAX-OKC, LAS-TUS, that sort of thing. They were definitely grasping at straws and chasing after a buck anywhere they thought they could find it.

    In the end, it was all an exercise in futility. Reno just couldn’t turn a profit. And unlike Sun Country, they generally had a good reputation for service and reliability. Just couldn’t attract enough dollars. In 1999, one of the strongest pre-9/11 years ever, they were on their last leg and were all but assured of shutting down had American not stepped in for the mercy kill. Perhaps a trial run for TWA just two years later.

    Seems to be a very similar story unfolding here.

  10. Anthony says:

    This just doesn’t read like a formula for longevity.

    If some of those new routes do “succeed,” Sun Country is apt to quickly have company on them —
    Frontier, Spirit, or even Southwest.

    And being based in a city that’s also a hub for the best Big Three carrier…. not promising.

    • Ian Littman says:

      Spirit has carved out a nice niche in DFW and IAH, as well as DTW. The former two have a legacy and WN. The last has DL. WN doesn’t seem to be a problem for these ULCCs because, well, Southwest can’t compete with unit costs that low plus ancillary upsells on hight-traffic routes.
      route there may be enough opportunities elsewhere for that not to make sense.

    • Sean S. says:

      Except Sun Country has existed in that hub for 20 years. This is not as if Delta is unaware of Sun Country, it just simply doesn’t base its decision making at MSP on that. The bulk of Delta’s expansion in recent years has been international with it’s various JV partners, and using its domestic feed and connectivity to power that. Going to Providence is not a part of that equation.

  11. CP says:

    Spaghetti, meet wall.

  12. JayB says:

    Sun Country, any reason why you couldn’t operate service for UA in those wonderful IAD hub-to-spoke(?) routes operated by Mesa for UA–927 miles to MSP, 1180 miles to DFW, and 1379 miles to SAT? Such luxury, year after year!

    Sun Country isn’t Singapore Airlines-class, but I don’t fly Mesa, ever, anymore! I know, complaining again, all UA needs is one or two PAX paying in the front, and the rest of us, well…such is life!

  13. ChuckMO says:

    Well, they’re trying at least. Some bold moves. And their are PLENTY of seasonal opportunities available to them. They’re back in STL (my home airport) in a minor capacity and I hope they prosper here. At this point they dont really fly from STL to anywhere I would want to go but maybe they’ll fly STL-LAX so I can make Dorkfest this year, maybe. Or I’ll just fly WN.

    When is that by the way Brett?

    • CF says:

      Chuck – Haven’t set the Dorkfest date yet. The NYC Aviation folks are doing it early in Sept, but I don’t think that’s going to work for me, so it’ll probably be decoupled this year.

  14. Desert Ghost says:

    My nephew recently flew the airline. He has regularly flown it from the Bay Area to the Twin Cities (where my brother lives) for a number of years. His comment was that the service had really gone downhill.

  15. Ted says:

    They will make some money on MSP-ORD, before NK, MSP-ORD was mostly highly priced, after NK joined, price tanked to the $50 range. since NK left that route, the prices has got back up to the $200-$300 range. we have done some $22 round trips on NK.

    as for the long term for SY. it will be a merger of some sort with F9 or NK, because when the demand goes during the recession, they wont have a change to keep the planes full.

  16. Bobsmith99 says:

    Agree that there is some randomness there but I do think the PDX-BNA route could work. I have read there has been a desire to add that route from PDX’s side (and have heard some anecdotal evidence from Nashville). Both cities are growing rapidly so I view that one as akin to PDX- AUS launching a few years back on Alaska and Southwest.

    PDX-SAT. Yes, good luck with that one.

  17. Michael Jones says:

    Enjoyed the Sun Country story but you left out HRL. Sun Country has flown from HRL to MSP for more than 25 years. This is big deal for the Rio Grande Valley because HRL is in the same catchment area as four other airports: BRO, MAM, REX and MFE…plenty of passengers…more than 3 million in the catchment area. DL also offers seasonal service to MSP from HRL and offers lots of network connections not available from the other four airports.

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