Originally Posted by
hercretired
While I agree that listening to doomsdayers is getting old, the "everything of roses" (the inverse of the doomsday crowd) is not accurate either.
Spirit, an arguably previously well-run company, and our primary competitor, is having serious issues.
Ryanair, publicly per Barry himself is the "model to emulate" is having issues.
etc
to say that Frontier has no challenges ahead is also incorrect
I agree with you. The truth lies between the two sides (as it normally does)
There has undoubtedly been a shift in the market. The Legacies are doing better then they have done since deregulation. You have to remember that the legacy airlines have had so many bad years, all have been thru bankruptcy and so much unhappy labor. My uncle has been at United since the early 90s. He's only recently been happy. 30 years of bad days and about 3 or 4 good years.
Southwest on the other hand had 30 great years, yeard profits and happy pilots. Only recently have things turned sour there.
The ULCCs in the US are still pretty fresh to the market. It's definitely had its ups and downs. Frontier and Spirit were both wildly profitable at one point, but post Covid have found themselves in a changed market. Both are adjusting and I'm sure there's a lot more change ahead. But the market definitely has a spot for them. People can argue about "being just as expensive after you add up the fees" but it's just not true. The airlines revenue is proof of that. A fully loaded up ticket on Frontier is still much cheaper on average than a legacy ticket.
Cost is king and there's a huge majority of the population living pay check to pay check. The ULCCs can survive.
Spirit and Frontier have very, very similar business models but have very different finicial positions. Spirit has over a Billion in debt and Frontier has very little. Spirit, as the first big ULCC has had a harder time with their public reputation. (We deserve a worse reputation but don't really suffer it. SNL and late night comedy still uses Spirit as the go to punching bag). In addition, Spirit suffered, and still is, badly from the P&W engine issues. They got absolutely decimated by that. Having nearly 40 aircraft out of service is horrible for business. Hopefully Frontier can navigate the P&W engine issues much better. It'll certainly be a much smaller portion of the fleet out at any given time.
But as a post above said, as long as my pay check clears, I'm going to keep showing up to work. Frontier likely loses a couple million bucks this quarterly report but we've got $650 million in the bank. I'm not losing any sleep.