Mountain ‘props modify the model

Frontier Airlines is taking a counterintuitive tack in its route back to profitability following the entry of Southwest and the buildup of United into Frontier’s hometown of Denver. The low-fares, low-cost Frontier is adding a host of short routes at a time when short-haul air travel is down and the 13-year-old airline is buying a fleet of up to 20 Bombardier Q4O0s turboprops to serve the routes at a time when most carriers are relying on regional jets.


Although the addition of turboprops to an all-Airbus fleet adds an element of complexity that the low-cost carrier business model avoids, the move rests on hard thinking and close analysis, Frontier chief executive Jeff Potter told analysts in a web cast. “When you draw a 650-, 700-mile circle around Denver, what we see is a lot of opportunity, but we didn’t necessarily have the right aircraft”, said Potter. “It gives us the flexibility to serve some of the Colorado mountain destinations that we couldn’t otherwise do”. That makes smaller resort and ski towns such as Aspen or Durango, Colo., or Jackson Hole, Wyo., candidates for Q400 service along with underserved business centers such as Grand Junction, Colo., and Billings, Mont. It will fly to as many as 18 destinations in Colorado and the Rocky Mountains. The first of the 10 firm-order ‘Q’s will be delivered in May, 2007.


The deal, worth up to $257 million, will be done through parent Frontier Airlines Holdings, which will operate them through a new subsidiary, Lynx Aviation, which plays on Frontier’s wildlife theme and slogan, “A Whole Different Animal”. Subsidiary Lynx will be marketed as FrontierExpress. Frontier will hire new employees for Lynx flights, likely at lower pay scales than unionised Frontier employees.


Frontier does have a regional jet feeder operator, Horizon Air, which also happens to be the only US operator of Q400s, but Potter said Frontier decided against having Horizon operate the new 74-seat turboprops. Potter said it would cost less for Frontier to use its new subsidiary.


Potter did say Frontier also wants to expand the number of planes in its regional jet partnership from nine to as many as 20 RJs for longer feeder routes. It will issue a request for proposals to operate that regional jet fleet, inviting Horizon, an Alaska Air Group subsidiary, and other carriers to compete for that flying. Frontier also has a small feeder relationship with Great Lakes Aviation, which Potter said will not be affected.

One Response to Mountain ‘props modify the model

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