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Frontier F9

Old 01-04-2008, 04:32 PM
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Question Frontier F9

Any info on what's going on with F9 these days?
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Old 01-04-2008, 06:28 PM
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Yup..........they are flyin.
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Old 01-05-2008, 09:27 AM
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They do seem to stay under the radar around here... must be a great place to work!
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Old 01-05-2008, 12:31 PM
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Outlook for pilots not so good at the moment:

The carrier is considering downsizing its fleet in coming months by leasing or even selling some of its Airbus aircraft. That could eliminate pilot and flight attendant positions, although Frontier hopes to cover any job losses through attrition and other means instead of layoffs or furloughs.

http://www.rockymountainnews.com/new...uncharted-sky/

Frontier's uncharted sky
From altered routes to new partnerships, airline explores ways to improve bottom line
By Chris Walsh, Rocky Mountain News (Contact)
Saturday, January 5, 2008

Ken Papaleo / The Rocky

Ray Davis works on the wing of an Airbus 319 on Thursday at Frontier's maintenance hangar at DIA.

New CEO Menke already has made tough decisions.

An Airbus 319 undergoes routine maintenance in Frontier's hangar at DIA. The carrier is considering downsizing its fleet by leasing or selling some of its Airbus planes.

Wade Specht works on the engine of an Airbus 319 at Frontier's maintenance hangar on Thursday. The carrier has cut 100 jobs to save up to $6 million a year.

Frontier Airlines has developed a strong brand around the bottlenose dolphin, grizzly bear, gray wolf and other animals that grace the tails of its jets.

Perhaps the Denver-based carrier should plaster a chameleon on its next new plane.

It's a fitting mascot as the company adapts to a changing industry environment stressed by soaring fuel costs, sour stock prices, consolidation speculation and nervous investors.

On top of that, Frontier operates most of its flights in Denver, which has become one of the nation's most competitive airline markets.

With a new chief executive at the helm, Frontier has made some big moves in recent weeks, including layoffs and a realignment of its route network.

More changes are ahead.

The company is considering partnering with international airlines and U.S. low-cost carriers, shedding some planes, further tweaking its route network and possibly shifting to a pricing structure in which passengers pay extra for some services and amenities.

It's all part of CEO Sean Menke's efforts to revive Frontier financially and on Wall Street, where the company has taken a beating in recent years.

"The world has changed for Frontier since I left," said the 39-year-old, who worked at the carrier for six years before departing to Air Canada in 2005. "There are a number of things going for it, but there are also some things that are not working. For me the biggest priorities are focusing on the bottom line and on profitability. We have to stabilize the airline."

One of Menke's biggest challenges will be transforming Frontier into a more competitive, profitable carrier while keeping intact the core values, employee morale and consumer brand the company prides itself on. He also might have to navigate through some turbulent skies if consolidation grips the industry.

"He's got a big job ahead of him," said Ray Neidl, an analyst with Calyon Securities in New York. "He's qualified to do it and he's capable of doing it, but it's a really tough situation right now with oil prices and competition at their key Denver hub."

On the job for just four months, Menke already has shown a willingness to make tough - and sometimes unpopular - decisions.

Oil forces hand

He took the reins of Frontier in September, hoping to focus on mid- and long-term strategies. But a rapid spike in oil prices changed those plans.

"When I started oil was at $72 a barrel, then it moved to the high $80s and then to the low $90s," said Menke, who served as Frontier's chief operating officer several years ago and has worked for other carriers including American West and United. "So my attention shifted to the short term."

The rise in fuel costs forced Frontier, which hasn't posted an annual profit in nearly four years, to revise its financial projections downward for the last three months of 2007. It's a problem that won't go away anytime soon, as oil hit a record $100 a barrel this week.

Menke's first big move to right the ship came in November, when he realigned part of Frontier's network by adding flights between Denver and some of its most profitable cities while scaling back or ending service completely in other markets. The shift included abandoning several new routes started under previous CEO Jeff Potter, including flights between DIA and Guadalajara, Mexico, and some nonstop service between cities outside Frontier's Denver hub.

Several routes "were just never going to work," Menke said, while others simply would take too long to mature and make money. Menke said it's more important right now for Frontier to have the planes flying in proven markets than to gamble on new ones.

"We were losing revenue in some markets because we actually didn't have enough capacity, while we had done some over-expansion in other areas," Menke said. "We had 15 to 20 percent capacity growth for years, and I had a concern with where we were going with all that new capacity."

It's a slight, yet telling, shift in strategy.

Frontier has failed several times to diversify away from Denver by creating domestic "focus cities," where the carrier operates several nonstop flights that don't route through DIA. The latest effort involved Memphis, Tenn., where it had started nonstop flights to Las Vegas, and Orlando and Fort Lauderdale, Fla., within the past year.

Menke, though, axed all that service with the exception of flights between Memphis and Denver. Developing new focus cities, he says, simply won't work for Frontier right now, and it's unlikely the company will try again in the near future.

Another bombshell

Frontier dropped another bombshell several weeks later, cutting 100 jobs in a move intended to save up to $6 million in annual costs.

It was the first time Frontier has laid off workers since the weeks after the 2001 terrorist attacks.

At the same time, Menke canceled the company's annual Christmas party, an expensive affair he says he couldn't justify in the face of layoffs and rising expenses. Frontier's senior marketing and planning executive also left for undisclosed reasons.

Aside from cost cuts, Menke focused on paring down the unwieldy list of projects the company was tackling.

"What I found right away is that there were too many projects going on," Menke said. "I think we needed to narrow down the priorities. When you have 100 different things going on, it's hard to do them well."

Frontier, for instance, had 250 to 300 information technology side projects alone. Menke and other executives drilled that down to 40 that they determined were of the highest priority, including one that will increase maintenance efficiency and another that involves a new flight-planning system expected to save several million dollars annually.

More changes ahead

There likely will be bigger changes in store as Menke moves from dealing with short-term challenges to addressing larger strategic issues.

Expect Frontier to keep growing, just not necessarily in the way it has to this point.

The carrier is considering downsizing its fleet in coming months by leasing or even selling some of its Airbus aircraft. That could eliminate pilot and flight attendant positions, although Frontier hopes to cover any job losses through attrition and other means instead of layoffs or furloughs.

Rather than grow by purchasing new Airbus planes (it only has two scheduled deliveries this year), Frontier aggressively will explore alliances with international carriers or even fellow U.S. low-cost airlines.

Some of Frontier's peers are moving in the same direction. JetBlue, for instance, this year struck an alliance with Aer Lingus, while Alaska Airways and Horizon Air cemented a code-share and frequent flier deal with Air France.

Frontier could look to nail down a similar partnership, or it could bolster its current marketing alliance with AirTran.

Such partnerships would give Frontier a way to offer its customers the ability to fly to more destinations without the investment and continuing costs of starting the service itself.

"For us to compete, we either have to go out and buy a bunch of new airplanes or we can develop relationships that will deliver that in a different way," Menke said. "I'm definitely a believer in the latter."

Menke hopes to strike a partnership as early as this year. The carrier also could expand internationally on its own, possibly farther into Central America and maybe even the Caribbean.

Lynx, a la carte

Some of Frontier's growth going forward also will come through its new Lynx Aviation turboprop subsidiary that started flying in December and will add routes to Colorado towns this spring.

Menke is a firm believer in the strategic importance of Lynx, particularly because the Q400 turboprop planes use 30 percent less fuel than other aircraft.

Douglas Abbey, a partner with the aviation consultancy Velocity Group, agrees with that strategy, saying it will help help Frontier "add value" to its network.

"This will help them feed traffic into their overall network and draw from cities" they can't draw from now, Abbey said.

Menke also sees a big part of Frontier's future in producing revenue in new ways, not necessarily just through selling more tickets.

One idea involves implementing an "a la carte" pricing system, where consumers pay extra for things such as checking bags, seat assignments or food. Under this plan, passengers who don't want those things can get a bare-bones fare.

The move wouldn't necessarily be surprising, as Menke came from a carrier - Air Canada - that has found success with that business model. And he has made no secret of the fact that he is in favor of it.

A critical piece, however, will be integrating it into Frontier's Web site, check-in counters and other areas of the company.

"It's becoming more important now to determine how we get more money out of the product we're offering," Menke said. "I'm a big believer that people are willing to pay more for different attributes. We're spending a lot of time on the technological capabilities that will enable that."

Consolidation, culture concerns

Frontier also might have to navigate through industry consolidation - what some say could be its biggest challenge. Several observers expect a frenzy of large mergers and acquisitions, and several big carriers including United have expressed strong interest in such moves.

That would make it hard for Frontier to remain independent.

"Frontier has done a fairly good job even through some of the difficult times," said Dan Kasper, an airline consultant at the Cambridge, Mass., office of LECG. "But they've got to be asking the question of 'how long can we continue to operate as a free-standing entity if our larger competitors consolidate?' I think they might have to look at that, and they won't be the only ones. "

Frontier has long said it wants to operate on its own. Menke, too, seems to prefer that strategy, although he said the company could take a different path if a good opportunity presents itself. Regardless, he said Frontier will be poised to grab gates, planes or other assets that airlines shed if mergers and acquisitions take place.

Menke has to weigh any changes with how they will affect customers and the company's carefully crafted corporate culture. And that could prove tough even though the company has managed to stay remarkably true to its roots, including in the aftermath of the Sept. 11, 2001, terrorist attacks.

"It's a difficult line for him to walk," said Gary Chaison, professor of labor relations at Clark University in Worcester, Mass. "He will have to decide whether he wants a warm and fuzzy company or a lean and mean company that can survive in hard times. The key is that there can't be any secrets and surprises for employees, and there has to be equality of sacrifice among management."

Menke said the company will scrutinize every decision to ensure the impact on customers is minimal, and he stressed that "in many cases inaction could lead to greater customer inconvenience."

As for the employee side, he acknowledged that the layoffs and the cancellation of the Christmas party jolted some workers. But Menke has put a strong focus on communicating with employees, and he continues to nurture the corporate culture, which is a foundation of the company's customer service.

"I'm a true believer in the culture here, but there's a question in the marketplace of the longevity of this company," Menke said. "I want people to have jobs, but if we don't make these tough decisions then we don't have a company. I've tried to make sure everybody here understands the situation we're in, and I think they do."

Last edited by Jack Bauer; 01-05-2008 at 12:37 PM.
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Old 01-05-2008, 01:50 PM
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They are one of the smallest niche airlines. Presumably they will merge or, more likely, get acquired by someone larger.
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Old 01-06-2008, 04:38 PM
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Yes but who....??? Should be interesting to hear the WN announcement tomorrow.
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Old 01-06-2008, 05:38 PM
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Default WN Annc.

Didn't know there was a WN announcement tomorrow? You guys have any idea what it's about?
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Old 01-07-2008, 12:51 PM
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Originally Posted by chicken View Post
Didn't know there was a WN announcement tomorrow? You guys have any idea what it's about?
not really sure, but the WN announcement is in Denver. Makes you wonder...
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Old 01-11-2008, 11:45 AM
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F9 can not survive the year without a huge development. They just adjusted their earnings forecast for the year to a loss of roughly 21 Mil...this after losing 22 Mil last year. As of today, their total market cap is just 130 million (or less by the time I write this based on how quickly the share price is falling). They are pulling out of markets, deferring aircraft deliveries, and SWA is gunning for them. WN has typically just gone in to new markets and tried to create more demand with low fares...this time they want F9s market share since oil prices make the increased demand thing and lower fares less viable. F9 guys I know are saying this too. They are scared!!
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Old 01-11-2008, 11:55 AM
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Originally Posted by Flex81 View Post
not really sure, but the WN announcement is in Denver. Makes you wonder...
What happened with the announcement?
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