Are we next?
 

ULCC business model is officially broken. I guess it’s time to address the elephant in the room. Are we next?

maybe.
maybe not.

outlook unclear.
check back at the end of your career.

for now let’s be helpful to those who are actually suffering rather than playing head games of what ifs.

I’m not saying it’s all candy canes and unicorn farts over here at F9. But, spirit had one too many problems simultaneously.

Chugging along like this forever isn’t a strategy, but “next” is not what I think is going to happen.

This isn’t really accurate — Frontier is not in the same risk category.

Frontier is structurally in a stronger position than Spirit for a few simple reasons:

• Lower CASM, period. Frontier consistently runs one of the lowest cost structures in the industry. When margins get tight, the lowest-cost operator survives — that’s Aviation 101.
• Better balance sheet discipline. Frontier didn’t load up on the same level of debt and financial commitments Spirit did, especially tied to growth and failed merger fallout.
• More flexible network. Frontier’s point-to-point, leisure-heavy model lets them cut or shift flying quickly without being tied to complex hubs or international commitments.
• Cleaner execution of the ULCC model. Frontier leaned harder into the true ULCC structure (high-density config, ancillaries, cost control), while Spirit drifted slightly higher cost over time.
• Less exposure to disruption risk. Spirit’s operational and financial volatility has been higher — Frontier has been more stable operationally, which matters more than people think in downturns.

The ULCC model isn’t dead — it punishes whoever loses cost discipline first. Right now, that hasn’t been Frontier.

It’ll likely depend on the overall profit/solvency of Indigo.

A few more more:

• Economic tailwinds. Only major direct competitor now gone in the ULCC space. This matters a lot for Frontier around its network and secondarily for JetBlue in FLL.
• More explicitly on CASM, more A320/1neos. The per passenger fuel hit wasn't quite as bad for Frontier as for Spirit, especially with the highest-density fleet and new-technology engines.
• Open space for up-charging. The ULCC standard is now Frontier, so Frontier can price as Frontier chooses.

Sorry if this is too soon, my heart goes out to all those who lost jobs. But I see this as a different, forward-looking industry discussion...

This is NOT correct. There are still market constraints besides Spirit.

Of course, didn't mean there weren't. Meant that there is no significant direct comparison.

If your evidence is NK, you'll need to try again.

Frontier and Spirit may have been somewhat similar airlines, however our balance sheets and ownership are completely different.

We are not anywhere near Spirit's position. We are actually very far from it. Even if we keep slowly losing money quarterly, we have little to no debt and have very close to 1B in liquidity.

AI slop and much of it is wrong (none of this is to say Frontier is definitely next, but PLEASE do not make decisions based on biased, incorrect information and reasoning):

Delta and United can afford to offer loss-making economy (and basic economy) seats to fill planes, so that they can generate higher margin revenue up front. The AI is treating airlines as a full commodity, not an industry with several (mostly commoditized) tiers.

Frontier has $5.144B in net debt, compared to $388M in 2025 EBITDAR (a fake # used to give investors a reason to buy overvalued and often unprofitable, capital intensive companies), for 13.3x leverage...a healthy airline should trade at around 6x EBITDAR and should not have leverage over 2x. Just because Frontier's debt is in the form of leases rather than bonds and loans, does not make it not debt...and owning your own planes is better than leasing.

As opposed to Spirit's point-to-point, leisure-heavy model that lets them cut or shift flying quickly without being tied to complex hubs or international commitments? Good job AI.

Spirit only "drifted slightly higher cost" by adding ancillaries after bankruptcy. Frontier is in the process of doing the exact same thing, because it's a way to increase RASM without increasing headline prices, with a minimal CASM impact.

Frontier's major direct competitor is not Spirit, it's Delta, United, American, and Southwest. Frontier had a larger route overlap with all of these airlines than their overlap with Spirit. There is still capacity being added to US domestic route networks, and Spirit's reduction in flying over the past few quarters/years has not helped Frontier's RASM-CASM issue.

More fuel efficient, newer planes are great, but Frontier pays higher lease rates for these. Larger planes have been the focus of Spirit and Frontier to help reduce CASM, but that only works when you are filling the planes and operating routes with enough demand. Frontier's sub-80% load factors (vs say, Ryanair's load factors of over 95%) show that the routes Frontier is flying do not have enough demand to fill out such large planes, and the new deliveries are increasing Frontier's seats/plane from sub-190 a few quarters ago to well over 200, exacerbating the issue. Bigger planes are not always better; some markets can handle them, but those markets often see the majors enter due to their size. The markets that are better fit for low-cost carriers to operate profitably with less competition are generally too small for A321neos.

Also, regardless of whose per-passenger fuel hit was worse, an unprofitable airline burning over $600M in cash seeing their biggest cost input more than double is a massive problem, doesn't matter if it affects other airlines more...airlines price off demand not costs.

The ULCC standard is Delta and United basic economy; Frontier still has no pricing power.

Again, Frontier has over $5B in net debt, and about $300-500M in liquidity. Headline liquidity is $874M, but you should subtract the air traffic liability from cash, as once cash/ATL gets close to or below 1x, card processors will stop letting you pre-fund operations using cash from new bookings. Additionally, the $220M revolver (included in headline liquidity) includes non-standard language that indicates a cash reserve requirement when borrowing against it. That is fine for a stressed but performing business, but if cash drops too low, the revolver becomes useless as the card processor and bank both want cash reserves. Liquidity is only an important metric when judging how long a distressed company can continue operating in the current structure, and should be viewed through the lens of the worst case scenario. In that worst case, the $874M figure turns into $874-ATL-revolver (or at least part of it, depending on exactly how strict the cash reserve requirement is), getting you to somewhere between $300-500M.

Frontier burned over $200M last year even when including over $400M in SLB infusions. Fuel was $929M. If that jumps by even 50% for the full year, and the RASM-CASMx issue is not fixed, that is a huge and immediate issue. Hope the best for all the Spirit and Frontier (and JetBlue) pilots and employees.

Thank you AK26 for exposing the AI amongst us.

Yes. That’s why BB was fired and two years too late. He focused on costs while neglecting RASM. Perhaps change is afoot, perhaps not. Either way it will take time to see the changes.

And for proving that if you are bored it’s only because you want to be.

If you are worried about it, maybe see where you can help improve costs. Single Engine taxi, cost Index even on the go home leg, minimize APU use (it takes about 8 minutes worth of single engine fuel burn at these prices to pay the maintenance contract cost for starting the APU last I heard)

Let the negative comments and downvotes commence.

Your points here are valid and more interesting things to think about than the slop previously posted. Just one comment on the lease cancellations--those were not free. Usually, lease cancellations come with high cash costs, and I suspect that will continue to be the case moving forward.

The recent deal with AerCap was more complex than a simple lease cancellation. Frontier knows that they don't have enough profitable route pairings to take up capacity as much as they had planned for, but also has only been kept afloat due to cash from SLBs. Meanwhile, AerCap would rather not have a customer in financial distress, and simultaneously wants more planes and engines to take advantage of the current pricing environment. So, AerCap allowed Frontier to return 24 planes early in exchange for Frontier "deferring" their 2027-2030 deliveries to 2031-2033, with AerCap stepping in and taking over those slots. With the planes being returned early and an announcement of 48 new engines in their spare engine pool, it seems like AerCap may be parting out the planes and using the engines as spares given the high rates for spares currently. AerCap also has somewhat improved their lessee base--they now have less planes with Frontier and monetized the lease cancellations...in a hypothetical scenario where they had not done that, and Frontier went under later in 2026 or 2027, AerCap would not have a direct claim to the incoming Frontier orders; by preemptively doing this transaction, they reduce their Frontier exposure and secure the valuable 2028-2030 deliveries without paying an SLB premium. And to put some high-level math on it, using Frontier's average gain on SLBs, and discounting back to the present, we get to a present value of the SLBs of about $650M for the 69 planes that Frontier pushed out from 2027-2030. Frontier management sees $90M in annual savings from cancelling those 24 leases, which we can estimate as equivalent to a present value of about $460M for the 8 years of savings, so AerCap got some value here.

The above shows that the transaction is not proof that leasing is better than owning; lease rates are higher than debt costs for any airline that can raise debt (JetBlue is in firmly stressed territory and just raised new debt against their planes at under 7%), and you have more control over the planes, no maintenance reserves, etc. Instead, it is just another benefit of the extraordinarily well timed pandemic neo family order that IndiGo (both Frontier and Wizz) placed. I would also note that with current capacity trends, Frontier probably would have rather deferred 2026 deliveries as well, if not for the cash/SLB issues...they require the SLB cash to continue to operate, and the plan is obviously to try to stabilize the operations before 2027. If that doesn't work, however, 2027 will no longer have the several hundred million dollar cash infusion from SLBs, and the true operating profitability of the airline will become apparent.

Stabilize operations before 2027. As in make a profit?

Kirby might be gunning for F9 next

Actually, since we effectively have no union now, no contract negotiations, and virtually no protections because just about every chair has quit, the only thing we have left is the company, trying to survive in a very challenging environment. I am planning on helping the airline as much as I can. Our new CEO has impressed me a lot more than our interim MEC chair. I have ditched my ALPA lanyard and have officially become a Company man. I can’t wait to start picking up open time. I don’t even care about premium. Go F9!!’

yes.

filler

I'm sure you meant this statement for dramatic affect but we are NOT unprotected. We most certainly maintain all of the same "protections" we've always had as per the CBA. There ARE airlines bigger than ours that don't have pilot unions (or at least recently hadn't) so the sky is not falling because of our union woes. This airline/pilot force was due a correction - as I mentioned many times before - due to the purveyance of a sub-market labor rate. Subpar pay is fine for the short term but market forces were never going to hold and a reckoning was needed. It's almost decent timing given DL's early opener a few weeks ago and luckily there are 2 outcomes that will be produced - this airline will either find a way to be profitable paying market pay rates or it will continue to struggle. The ONLY way forward is via direct competition and the "merits" of the airline will need to win customers.

So, the question of "are we next?" is pertinent. But the answer has little to do w/ a temporarily disabled union...

I would have to do some digging but I’m pretty sure at the most recent investor conference Jimmy D mentioned specifically that the rejected leases did not incur a cash penalty as would normally be expected. We did also agree to 10 more Aercap leases in the future (2028?) so that could have been part of the reason why. Those future rates could be higher than usual to offset. It was too new to be posted in the 10-Q so more data required.

The lease rejection was even more complex than you describe. Those Aercap leases were mostly 8 year leases that, as recently as early 2025, had been extended to 15 year leases. Then obviously the quick about-face happened in late 2025. As to your point of “not enough profitable route pairings” I disagree. After the rejection announcement I dug a little deeper and noticed that the pilots were flying near their max capacity block hours for the month of March yet the aircraft were only at 80% utilization. In short, we were paying for aircraft we couldn’t fully utilize because we didn’t have the crews to fly them. ULCC and not max utilization lead to pain and suffering which you clearly know and our balance sheet showed. The time it would take to get the company fully staffed for these aircraft would be well over a year and at our loss rate that is an unacceptable timeline. So while I was pretty bummed at first with the rejection I think this was a very clever move on their part. Jimmy seems to be correcting Biffles bad moves.

I also did some modeling with the rejections and the reduced flying on T/W and it made even more sense. They are just too expensive of an aircraft to sit on the ground, ever, vs an older owned one vis-a-vis Allegiant. A credit to your owned aircraft point.

Thankfully for us Jimmy D has acknowledged we need to be profitable without SLB. We here are all ready for that day.

Mgmnt better figure out how to turn a profit or we WILL be next…

Agree with you 100%. As pilots we should be doing what we can within our scope to help frontier be profitable. Only, when this company gets in the black, can we have any hope of higher compensation.

i had a senior captain tell me he “doesn’t get paid enough to taxi single engine or shut down the apu”. I get the frustration, but this isn’t going to help us.

idk why people think they are going to get a new contract without the company being profitable first.

Allegiant and Sun Country make money

The network carriers make money

There is probably room for something in between. Basic Economy killed ULCC as a large airline model, but that doesn't mean there isn't room for one moderate size ULCC that stays in its lane.

NO NO NO

smh

Let's take your suggestion and extrapolate. We continue to be paid less. Attrition stays high (despite the flood of NK pilots into the market). Training costs stay high (ioe gets even longer), veteran pilot corporate knowledge decreases and the EXACT conditions we have now (not profitable) stay that way or get worse. Premium scabs become more plentiful and we already have a tail strike problem. Lack of cooperation w/ the company increases. Nothing changes and the vicious cycle of waiting for profitability before pay raise never happens.

The ONLY way forward is to pay market rates. That would end attrition and increase accessions. It would be temporary cost that would soon (18-24 months) be supplanted by profits as we can now expand, offer greater flight options and expand into additional markets. There need to be raises across the board (all labor groups) to increase customer service. We need to INVEST in wifi. We need a cash infusion on the level of probably a 1/2B (maybe more). NO COMPANY on earth starts for free and pays less forever - Indigo purchased F9 in 2013.

Growth costs money. Indigo has it. Franke just needs to find someone he believes will make the cost worthwhile in the end. Is that Dempsey? No idea. But the only certain thing is our current strategy and pay rate will end in only one way.

ULCC works... but...
 

ULCC can really work well, but it needs the whole company to stay disciplined. For us pilots, ULCC usually makes us focus on saving fuel, and it’s more than just a suggestion—it’s enforced because that’s where the big bucks are. Airlines using ULCC strategies worldwide have some pretty strict fuel policies. They often set specific CI speed limits unless ATC says otherwise, require flaps 3 for landings, have packs off during departures without APU, minimal APU usage and encourage one-engine taxiing, among other things. These aren't just guidelines; airlines actually keep an eye on pilots monitoring personality who don’t stick to the rules. When they crunch the numbers, they see that operational costs have to be kept really low—otherwise, investors lose interest, and the airline could struggle to survive. ULCC can be profitable, but it’s got to be managed right since the profit margins are super tight.
Let's assume a 700 departure day, if they can save 100lb each leg, it's 70.000lb in one day alone or 25.550.000lb of fuel per year.... just 100lb per leg means millions of dollars in a year..... for a business with such tight margins this is big a deal. That's how ULCC Business are.... penny by penny.

the management compensation committee just had an idea…..

I agree with you that a constant stream of pilots moving onto other companies is in fact a cost, but disagree with everything else you said. The regionals have been operating with that turnover since their inception, yet they turn profits correct?

During the 2022/2023 hiring boom, I flew with an FO who’s wife was an FO at Alaska. Each month they compared seniority lists. Alaska was losing almost the same percentage of new hires as we were. Frontier could pay us delta rates tomorrow, and we’d still have people leaving.

Wants to fly wide bodies
Doesn't want to fly the same plane for 30 years
Wants access to different bases
Doesn't want to tell the chicks at the bar that they fly for frontier while wearing their giant watch
Grandpa and dad both flew for xyz
I had an FO who was quitting to go to JetBlue simply for access to better pass travel agreements.

Frontier knows this. High pay would slow attrition, but would not eliminate it to legacy levels. That’s delusional thinking man.

For those of you who are new to this airline world, this is how it works: companies are profitable=pilot groups negotiate a higher contract. Companies are not profitable=pilots hope to keep existing contract. These tricky airlines will even come at the pilot group for concessions when they aren’t profitable for extended periods of time, or see a massive downturn. Yes, contracts can be negotiated the other direction. Just for fun, do some research and list all the airlines that have enacted concessionary pilot contracts in their past. I’ll give you a head start: Frontier.

Until frontier starts turning a consistent profit, we have little chance of higher pay. Take your strike lanyards off. They are embarrassing at this point. Go to work. Do what you can within your scope to help make the company profitable. That’s all we can do.

That's probably what Spirit thought in 2022 or so.

You DO realize regionals:

a). do NOT sell their own tickets and are paid for (subsidized) by legacy
b). have been going out of business for YEARS. Ask any former XpressJet, Comair, Great Lakes, Chatauqua, (and about 50-75 more) . . . member

And, the regionals that have survived, whether wholly owned or not, FO PAY is pretty much commensurate w/ F9 now. It's an actual tough decision for a FO to leave a regional w/ a flow over going to F9.

Read up on SWA - started out point to point in TX only (and had to overcome the Wright Amendment). Paid about 40% less than everyone else. Flew one type of aircraft. Sound familiar? Look at them today. Highest paid in the industry. Award winning customer service and credit card plan. Not the same as it was about 10 years ago (no airline is) but has never had a non-profitable year until COVID. They taxi fast, 2 engine and start the APU on every landing. It can be done if you MANAGE correctly.

Almost your entire post is irrelevant.

So far, it's true. The divergence is where Spirit took on more debt & rapidly increasing costs, whereas F9 has so far managed the costs reasonably well. While it's certainly possible a bankruptcy could be in F9's future, I'd bet money on them existing in 5 years, whereas Spirit is dead today.

If you have more to add to the convo, rather than just providing some useless fear-inducing driveby, please do share why the two are remotely comparable.

We are managed differently, and I will be the first to say not correctly.

Single engine taxi does not equal taxi slow, and it's a waste of gas to taxi slow if there is no traffic in front of you. If it's a Classic it may be equal money for fast taxi but NEO makes plenty of thrust to SE taxi fast for about 400 lbs/hr less a than 2 engine taxi, and only while you have the power increased to accelerate.

APU on landing is not how we are managed here. They have decided that it is worth the money to have a ramp agent spend his time hooking up power. while sitting at the gate waiting for power it takes 8 minutes of SE burn time to equal our per start cost on the APU.

I get that a lot of the cost is because the executives are missing low hanging fruit, but managing the operation of the airline is not your's or my job. operating the flight efficiently is. That is literally the only influence we have on whether we are here if these fuel prices stay up for an extended time, the rest is up to the corporate types.

Agreed. But my point was (as I think you already understand) that if you're managed correctly, small cost savings like taxi time and extra APU usage, is barely noticeable. I don't know the #s but I'd be surprised if we didn't have at least 3-5% of our flights hold longer than 8 minutes either waiting on a gate or waiting for external power. The KEY to reducing costs lies in a better network, better under wing services and better overall operational management.

What the pilots can affect is so minimal, it's hardly worth mentioning.

Minimal impact on a minimal margin is a lot larger than you might think.

$53 million profit last quarter, saving 400lbs a flight would have boosted that up at least another $5 million at the gas prices we had then. That's about a 10% impact on profit.

They are messing up a lot of things up by themselves. If I don't have a gate agent within 90 seconds I crank the APU. Almost every single time if I had left the engine running it would have been a 10 minute or more wait before I got power. That's on them. Having a mechanic wait on the phone for MCC to answer for 30 minutes, 100% on them. Gate availability is all theirs. About 2 dozen other stupid things you see nearly every single work day that is all on them and would be easy fixes.

frustratingly stupid revenue leakage, but it is what it is.

I absolutely refuse to sit at a gate with an engine running for any period of time as long as I have an operable APU. Ain’t gonna happen. It is not safe, especially given the egregious lack of experience that we have working below wing. I don’t care how much it costs to start the thing — it’s simply not worth someone’s life.

Thank you. I start the APU 2 minutes after landing, single engine 3 after landing. As soon as the parking brake is on both engines are off. To me it’s a safety issue, period. And I am willing to bet I use less fuel than sitting at the gate for 5 min waiting to get plugged in.

If you're doing single engine taxi out you're expecting to have a long taxi, so there's no point comparing SE taxi out with saving taxi time, on top of that you're not only saving fuel, if you manage properly it's less breaking as well.
About the APU it's nit only about fuel, it's about cycles. If you start it then shut down when they connect the external power then your start again later, it's two start cycles not only one, more wear and tear. I known that seems all peanuts but It all ads up to millions when you consider hundreds of flights a day.

Normal taxi times are about 12 minutes for both takeoff and landing. Let's use 15 mins for an example. Each engine burns approx 600 lbs / hr at idle and requires a 3 minute cool down (or 3-5 minute warm up). So, that's 12 minutes of SE taxi (saving 240 lbs of fuel) or about half of what you're claiming. Yes it helps but fuel used for taxi is about 1% of the total consumed so it just doesn't add up to that much as compared to other things. TBH, if we REALLY wanted to save money, we'd fly at green dot (and w/ the significantly over blocked leg times, we'd still be on-time mostly). That would save more money by far.

I have a better solution. Why don't we INVEST in better people at the gate, more friendly ticket counter personnel, update our flyfrontier app and pay labor more. Then, we improve our on time rating, our customer service and our reputation. Then we charge more for a ticket to make up for the invested funds. This is the same way ALL of the other profitable airlines did it.