After all, could Frontier Airlines and Spirit Airlines eventually merge?
“That’s my prediction,” the CEO of a competing low-cost carrier told TPG.
Discussion has swirled for years about a potential alliance between the country’s two largest low-cost airlines.
spirit and frontier Considering merger in 2022but spirit withdrew from negotiations Pursuing marriage with JetBlue instead – ultimately a deal blocked in court By the Biden administration.
Then, late last year, the Wall Street Journal reported The airline is said to have reignited acquisition negotiations. However, according to reports, the deal It fell apart A few days before Spirit The company announced that it has filed for Chapter 11 bankruptcy protection..
Spirit’s financial turmoil due to mounting debt, falling revenues and a myriad of other factors comes amid a general slump among low-cost airlines.
Tough situation for low-cost airlines
In recent years, the low-cost segment of the U.S. aviation sector has been eclipsed by large “legacy” airlines with long-haul international scores. What travelers are looking for now. Not to mention, major airlines offer amenities like premium cabins, lie-flat seats, and highly lucrative frequent flyer and credit card programs that have played a big role in profitability since the coronavirus pandemic.
Some in the industry, United Airlines CEO Scott Kirby being the most vocal. predicted death Some low-cost airlines, especially Frontier and Spirit. These airlines have long been known for offering ultra-low base fares while adding on fees for most other in-flight services.
In a wide-ranging interview with TPG last month, David Neeleman, a fellow low-cost airline executive and CEO of Breeze Airways, offered his perspective.
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“I think Spirit and Frontier will survive,” Neeleman said. “But I think it would be much easier if we merged. Once we became one.”
Asked if he absolutely foresees a future merger between the two airlines, Neeleman answered without pause: “Yes.”
Both airlines have repeatedly declined to comment on the protracted merger and acquisition talks. It may also be worth noting that the incoming Trump administration is widely expected to take a more lenient regulatory stance than the previous administration, perhaps encouraging reintegration efforts.
Premium products attracting attention from low-cost airlines
In any case, Mr. Neeleman echoed United’s Mr. Kirby’s frank assessment of the state of the U.S. airline industry: that the Chicago-based carrier is superior to the low-cost carriers (of which Breeze is one). He said that he generally agreed with the assessment that
Kirby reiterated in 2024 that United Airlines’ “structural, permanent and irreversible” dominance in the industry is similar to that of Delta Air Lines.
Now that major airlines have all but eliminated change fees and added their own cheaper, no-frills basic economy fares, Kirby and others wonder why travelers should pay less when similar fares are available on full-service carriers. I’m having doubts about choosing an airline. .
Other low-cost airline executives dismissed predictions of the industry’s demise.
“That’s crazy,” Frontier CEO Barry Biffle quipped about the claim in an interview with TPG last month.
But Neeleman took a slightly different view.
“Scott [Kirby] We figured out how to get people to fly on United the same way they fly on Spirit, knowing that if they could come to United and get on a plane, no one would fly on Spirit.” said Neeleman.
“If you fly on United Airlines, [Boeing 737] max 9 [jet] Nowadays, we’re able to perfectly cater to what people want,” Neeleman continued, adding that from first class to extra legroom to bare-bones options, United Airlines’ Mentioned.
This is a wide menu of features that travelers also have access to on Delta and American Airlines. Such diversity is also being considered in the list of fast-growing low-cost airlines. Frontier announced new first-class-style seats in December, Southwest Airlines plans new rows with extra legroom in 2026, and JetBlue plans to add first class on domestic flights. cabin. (Mr. Neeleman is perhaps best known in the United States for founding JetBlue in 2000).
Brees sees opportunity
Now, Neeleman says changing traveler preferences — a desire for more space in rows, upscale seating and overall more choice — bode well for his latest startup, Breeze. I think there is. The airline launched in 2021 in the midst of the coronavirus pandemic.
Since its launch, the Utah-based airline has offered free baggage, Wi-Fi service and first-class-style recliners to passengers who choose the “Nicest” fare. These fares are an alternative to traditional low-cost airlines’ bare-bones fares (“nice”) for bargain shoppers.
“When we play those guys, we do really well because people want to ride Brees,” Neeleman said of Spirit and Frontier.
Of course, his airline is likely to face even more competition in the coming years as travelers increasingly find options for extra space on planes on low-cost carriers. This is the main reason Breeze is “seriously considering” adding more seats to its Airbus A220’s “most impressive” fleet, Neeleman said.
“We started with 24 [first-class seats on board] “I think we’re seriously considering going back to 12 aircraft because the demand is so high,” he said, adding that airlines could reconfigure their aircraft “overnight” to make such a change. pointed out.
International flights are just around the corner
But what about international services?
The last time I spoke to Neeleman was about eight months ago, he teased: Future international expansion It is tied to major long-term growth plans for Rhode Island TF Green International Airport (PVD) in Providence.
In fact, Breeze’s fellow startup airline, Avelo, also launched in 2021. thoroughly defeat Bradley International Airport (BDL) in Hartford and Raleigh-Durham International Airport (RDU) in North Carolina offer new service to Mexico, Jamaica, and the Dominican Republic. BDL and RDU are two airports that are attracting a lot of attention from emerging airlines.
Neeleman cited delays in receiving Federal Aviation Administration approval to allow Breeze’s planes to fly internationally. He told TPG that the process should be completed by the end of March.
“And you can go to places like the North Atlantic, like Hawaii, mainly the British Isles and Ireland. Places like that,” he said.
But first?
“Mexico, Dominican Republic, Jamaica, things like that,” he said.
Breeze currently offers 280 nonstop flights, 86% of which have no competition, the company noted this month.
That growth is expected to continue into 2025. Seat capacity is expected to increase by about 49% in the first half of this year compared to the same period last year, according to data from aviation analytics firm Cirium.
Amid historic shifts in traveler preferences, it remains to be seen whether the focus will be on international or domestic flights, economy or premium cabins. stay tuned.
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