Frontier in play
06-11-2011 | 07:11 PM
#12
Line Holder
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It makes sense but DAL does not like the 318 at all.
Also if DAL wants early positions on the C-Series, all they have to do is place an order. RJET is in trouble and unless they are bailed out, those orders will be available. I of course would like DAL to acquire parts of RJET, namely, all of the F9 airbus flying and those pilots as well as all of the MEH pilots.
Also if DAL wants early positions on the C-Series, all they have to do is place an order. RJET is in trouble and unless they are bailed out, those orders will be available. I of course would like DAL to acquire parts of RJET, namely, all of the F9 airbus flying and those pilots as well as all of the MEH pilots.
Frontier certificate is about to get alot more attractive.
06-11-2011 | 08:22 PM
#13
Gets Weekends Off
Joined: Dec 2009
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From: 7ERB
It makes sense but DAL does not like the 318 at all.
Also if DAL wants early positions on the C-Series, all they have to do is place an order. RJET is in trouble and unless they are bailed out, those orders will be available. I of course would like DAL to acquire parts of RJET, namely, all of the F9 airbus flying and those pilots as well as all of the MEH pilots.
Also if DAL wants early positions on the C-Series, all they have to do is place an order. RJET is in trouble and unless they are bailed out, those orders will be available. I of course would like DAL to acquire parts of RJET, namely, all of the F9 airbus flying and those pilots as well as all of the MEH pilots.
). I would think DAL could get 50 Airbus on their own, rather than purchase Frontier and inherit their problems.
TEN
06-11-2011 | 08:54 PM
#14
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06-12-2011 | 05:36 AM
#16
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From: In the bunk
That said, I don't believe that a failure to come up with an SLI, doomed the sale to SWA but it sure didn't help. Ultimately Republic made an even more attractive offer.
GK predicted that F9 would be for sale again at half the price, looks like he could be right.
06-12-2011 | 08:29 AM
#17
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Aug. 17, 2009/Deal Journal
Posted by Michael Corkery
The Frontier Airlines executives and unions officials returning home from last Thursday’s auction in which Frontier was sold to Republic Airways Holdings Inc. were hailed as heroes.
After landing in Denver, Frontier’s hub, their airplane taxied beneath a “water cannon salute” and was greeted at the gate by 200 cheering Frontier employees. “It was awesome,’’ recalls John Stemmler, president of Frontier’s pilots union.
The deal with Republic has people in Denver celebrating because it prevented Frontier from being sold to Southwest Airlines, which would have likely resulted in thousands of job cuts. Republic, which is a contract flier for other airlines, will likely keep more Frontier jobs because it doesn’t currently employ ticket handlers or do route planning.
The Frontier pilots were key to the outcome because they balked at a proposal by Southwest’s pilots union that would have put the Frontier pilots at the bottom of the seniority list of the combined companies. Southwest was unwilling to negotiate and handed the keys to Republic.
Deal Journal spoke with Stemmler about the auction and Frontier’s future. (Read a previous Deal Journal interview with Stemmler after Southwest first made its bid for Frontier) Here are excerpts from the latest interview.
Deal Journal: Were you surprised that Southwest, a much larger and better capitalized company, lost the auction to Republic?
Stemmler: Yes. Southwest has a $2 billion checkbook. They came in saying they intended to win. I was surprised they were unable to overcome more of the issues.”
DJ: Why was seniority such a big issue?
Stemmler: We have 640 active flying pilots. All of them would have been positioned at the bottom of the seniority list, or stapled to the bottom as we call it. Southwest is ten times larger than we are. There was no way Frontier pilots were going to move (up that list). We only had four hours to negotiate. It took Delta Northwest six-and-a-half months to negotiate the seniority issue (amid merger talks between those airlines).
DJ: Did you make any progress?
Stemmler: We started and ended negotiations with our pilots at the bottom. That didn’t seem like a good deal to us…. Southwest management didn’t want an acrimonious mix (of Southwest and Frontier pilots). At the end of the day, their management left it up to labor.
DJ: How will Frontier seniority be sorted out with Republic pilots?
Stemmler: We have confidence we can come up with a consensual list since we have time. Southwest said we will close only if you can come up with a list. Republic says we will close and we will operate Frontier as a fenced off entity until (Frontier and Republic pilots) reach a deal. And in case we can’t reach a deal, it will go to binding arbitration.
DJ: Given the tough times in the airline industry, are you concerned that Republic isn’t as well capitalized as Southwest?:
Stemmler: Sure, I would rather have Southwest’s balance sheet behind me but Republic presented the highest and best offer. We went in looking for the best deal for our pilot group and I think that’s what we got….For the last eight months, Frontier has been profitable while in bankruptcy. It’s not like we will be a drain on [Republic’s] revenue stream.
DJ: What are your hopes for Frontier under Republic’s ownership?
Stemmler: It’s very exciting for us because we’ve been in been shrinking for two years. This really is the chance to diversify and grow. We are a one hub airline that needs to change
06-12-2011 | 08:34 AM
#18
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Let me rephrase that: We didn't choose RAH over SWA. We said that a staple job was unacceptable without a lot of other stuff, and that was a deal-breaker. I think it was Sean Menke who said that even with an agreement, RAH would still have won the bid.
FAPA was concerned about that due to the total inequity of a staple job, and SWAPA unwillingness to guarantee jobs for the furloughees.
I do believe if FAPA wasn't so concerned about seat protection and benefits above and beyond what even SWA pilots get (health insurance and a monthly stipend for life for furloughees) that maybe, just maybe Gary Kelly would have made a more competitive bid.
...
GK predicted that F9 would be for sale again at half the price, looks like he could be right.
...
GK predicted that F9 would be for sale again at half the price, looks like he could be right.
06-12-2011 | 09:21 AM
#19
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From: 737 FO
Let me rephrase that: We didn't choose RAH over SWA. We said that a staple job was unacceptable without a lot of other stuff, and that was a deal-breaker. I think it was Sean Menke who said that even with an agreement, RAH would still have won the bid.
FAPA was concerned about that due to the total inequity of a staple job, and SWAPA unwillingness to guarantee jobs for the furloughees.
FAPA was concerned about that due to the total inequity of a staple job, and SWAPA unwillingness to guarantee jobs for the furloughees.
06-12-2011 | 09:56 AM
#20
Rollin'
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From: AA Airbus
There are several possible takes from this announcement:
So, in exchange for concessions Republic will, among other activities, seek a buyer for the majority of the Company's ownership.
One rumor is that Delta might be the acquiring carrier to fill the narrow body fleet gap and perhaps capture some early C Series deliveries. I do not think this likely due to the fact Delta has already passed on the E190 and would rather have the 320 NEO (my guess). A more likely buyer (which FAPA probably would not like) [B]is SkyWest with their pile of cash and need to diversify revenue streams [/]Bas fee for departure contracts expire. Republic is hoping for a Jet Blue sale.
The problem for Frontier is their need for a network. In this marginal industry the marginal traffic from network feed is an imperative.
So, in exchange for concessions Republic will, among other activities, seek a buyer for the majority of the Company's ownership.
One rumor is that Delta might be the acquiring carrier to fill the narrow body fleet gap and perhaps capture some early C Series deliveries. I do not think this likely due to the fact Delta has already passed on the E190 and would rather have the 320 NEO (my guess). A more likely buyer (which FAPA probably would not like) [B]is SkyWest with their pile of cash and need to diversify revenue streams [/]Bas fee for departure contracts expire. Republic is hoping for a Jet Blue sale.
The problem for Frontier is their need for a network. In this marginal industry the marginal traffic from network feed is an imperative.
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