Frontier Airlines Facing Stiff Competition

Republic Airways Holdings which purchased both Frontier and Midwest last year said that it selected the Frontier name as the brand of the future because it was the airline whose name was more closely associated with low fares.  Nevertheless, Republic claimed that Midwest’s influence would be felt going forward.

One example of this influence is that all Frontier flights will be offering its passenger the iconic warm chocolate chip cookie this summer.  Republic said that although research showed that while passengers preferred the Frontier brand,  they also express a strong loyalty to both brands based on affordability, convenience, destinations and delivery of a unique experience.

Republic has been code sharing between the two airlines since acquiring them in separate transactions last year.  Ticket sales under the Frontier name exclusively are projected to start in November.   Full integration will take up to another 18 months, resulting in an airline with a single computer system, website, frequent-flyer program, crew uniforms, and aircraft livery.

Both airlines’ unionized workforces are in arbitration to decide on their merged seniority lists.

Republic claims that as a result of this merger Frontier is bigger and stronger, and better positioned to sustain profitable growth in its key markets.

Travel experts believe that Frontier faces significant competitive challenges in both Denver and Milwaukee.  United currently has the largest share of the Denver market, with about one third of the inbound traffic to that airport.  Southwest, which failed in its attempt to purchase Frontier in ’09, has become a major competitor in both Denver and Milwaukee.

AirTran, who unsuccessfully bid to acquire Midwest in ’06, is the dominant airline in Milwaukee.  Delta remains a major competitor in Milwaukee because of its purchase of Northwest.

If they so decide, Frontier’s major competitors can undercut Frontier by adding capacity and cutting pricing.  Hopefully travelers are the ones who stand to gain the most while these airlines duke it out.

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