Frontier Airlines to charge some customers for carry-ons, drinks

[HowardBorden]

"To fee or not to fee?" It is the question nagging every airline these days, and Frontier took a huge step toward a fee-based model Wednesday when it announced some customers will be charged for beverages and overhead-bin space.

http://www.denverpost.com/breakingn...rlines-charge-some-customers-carry-ons-drinks

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[SAABaroowski]

I think Spirits profits/model have gotten everyone's attention...........

 

[Ky.BrownBourbn]

Ballsy move,

More profits or the beginning of the end?

Good luck,
KBB

 

[AnimalMother]

So do they charge this upon taking your seat? Or when you buy a ticket?

 

[HowardBorden]

Ballsy move,

More profits or the beginning of the end?

Good luck,
KBB

It also seemed to me to be a pretty large departure from the previous business model. It seems to be working for Spirit so who knows.

 

[tzskipper]

Coincidence?

I'd bet that this has Indigo fingerprints on it...

http://www.denverpost.com/business/...suitors-both-have-spirit-airlines-connections

 

[Ky.BrownBourbn]

Here's the article before it disappears off the link!

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2 COMMENTS
BUSINESS
Frontier's suitors both have Spirit Airlines connections
POSTED: 04/21/2013 12:01:00 AM MDT
UPDATED: 04/21/2013 01:24:49 AM MDTBy Kristen Leigh Painter
The Denver Post
The two private equity firms believed to be interested in buying Frontier Airlines both happen to be stockholders in the ultra-low-cost carrier Spirit Airlines ? a parallel that analysts point to as a potential clue.

Phoenix-based Indigo Partners LLC specializes in acquisitions and strategic investments in airlines and air transportation, while Anchorage Capital Group of New York City does not specialize in aviation but has some experience in the market.

Dow Jones Newswires cited unnamed sources close to the negotiations when reporting the two firms' interest. Neither company has confirmed its interest, but executives have not denied it, with Indigo managing partner William Franke telling The Denver Post, "We look at opportunities from time to time in the airline sector."

Indigo was founded in 2002 by Franke, former chief executive of America West Airlines and current chairman of Spirit. Indigo, formerly the controlling company of Spirit Airlines, put the company up in a public offering in 2010.

However, as of Feb. 16, the firm remained the largest shareholder of the Miramar, Fla.-based airline at 16.6 percent with 12.1 million shares.

Spirit Airlines has made a name for itself in the industry for its ultra-low-cost fare structure and a la carte menu of fees. The carrier offers ticket prices far below its competitors, but often takes its customers by surprise with extra charges such as $25 to $50 for a carry-on bag.

Spirit and Frontier fly the same kind of Airbus, which airline analyst George Hamlin noted could be flown by the same crew.

"You wonder if (Indigo) is sort of looking at it as an asset buy," Hamlin said. "It could be a way to expand Spirit either directly or by moving things around."

Despite its status as a public company, Spirit's board of directors recognizes the power position that Indigo holds.

"As a result of its ownership positions, Indigo is able to exert a significant degree of influence or actual control over our management and affairs and over matters requiring stockholder approval, including the nomination and election of directors, a merger, consolidation or sale of all or substantially all of our assets and other significant business or corporate transactions," said Spirit Airlines' most recent annual report.

When Spirit Airlines announced it was re-starting service at Denver International Airport last May, Frontier CEO David Siegel rebuffed the notion that they would be a major competitor. On the contrary, some people speculated that the two airlines could merge.

"I can hear many suggesting it is time to strike up the band because Frontier's merger partner is coming to town," Bill Swelbar of Massachusetts Institute of Technology told The Post last March.

However, the technology would not allow the two airlines to code-share, but at the time Siegel would not write-off the possibility of a different type of partnership.

The airline industry is notorious for its high overhead costs and low profit margins, but the economy's upturn seems to be encouraging enthusiasm again, Hamlin said. As to why it is private equity firms most interested in acquiring Frontier, he said they are the only companies who are in a position to buy right now.

"They must be qualified buyers, and the private equity people are," Hamlin said. "There seem to be a lot of people who want to play in the biz, but few have the resources to attempt it."





Read more: Frontier's suitors both have Spirit Airlines connections - The Denver Post http://www.denverpost.com/business/...ave-spirit-airlines-connections#ixzz2S9nWG0cB
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[DUBLINFLYER]

Ryan Air has been charging for everything on board their aircraft for years (water, soda, coffee, etc.) The only thing they have not done yet is put a coin slot in the toilet door, leave it to O'Leary i'm sure its coming!!!!

 

[wscrj]

You mean like this?

http://m.youtube.com/watch?v=EYspsgIjb4U#

 

[SAABaroowski]

The ensuing battle over seniority integration should be fun.........