Atlanta is turning into the newest test market for the hottest trend in the airline business — the ultra-low-cost carrier. Spirit Airlines and Frontier Airlines are both planning significant expansion at ATL: Spirit said last week that it is adding nine new routes there this coming spring and summer, and Frontier announced today that it will fly nonstop to 10 more cities from ATL, for a total of 16.
On April 30, Frontier will launch a daily nonstop between Atlanta and: Cincinnati, Las Vegas, Los Angeles, New York LaGuardia, New Orleans and Minneapolis/St. Paul. To celebrate, the airline is offering one-way fares as low as $19 between ATL and New Orleans or Orlando. It should not go unnoticed that nearly every one of these cities is a key Delta hub or focus city, so it’s clear that low-frills Frontier has Delta in its crosshairs (Southwest, too).
A Frontier spokesperson told TravelSkills, “Frontier is going from six destinations to 16 from ATL by April 30. We will be ATL’s third largest carrier in terms of departures this summer. Denver is still our largest hub, followed by Chicago O’Hare, then Atlanta.”
Just last week, Delta and Southwest faced another significant threat by another “ultra low cost” carrier. As we reported on TravelSkills, Spirit Airlines announced nine new nonstop routes from ATL, giving it a total of 15 destinations out of Atlanta.
Frontier previously announced that it will launch nonstops from ATL to Austin, Indianapolis, Miami and Philadelphia in March.
It will be interesting to see how the established players respond. Equally interesting will be to see how these two ultra-low cost entrants will fight since many of these new routes overlap. In either case, it likely means lower fares in Atlanta and elsewhere. But stay tuned… both carriers have a history of moving in and out of markets very quickly.
Let’s compare these two ultra-low cost contenders:
The two airlines have some strategic similarities. With their focus on keeping basic fares to an absolute minimum, they charge more kinds of ancillary fees than other airlines (most notoriously for carry-on bags that go in the overhead bin). They also tend to have limited schedules, rarely more than one flight a day in a given market, and often only a few flights a week — hardly ideal for business travelers who value schedule frequency above all else. That’s because these airlines are going after extremely price-sensitive customers, nibbling around the edges of the larger market.
And from a bottom-line standpoint, it’s a formula that works: Spirit has become a darling of Wall Street, with better profit margins than its larger competitors and ambitious growth plans. Spirit’s total capacity rose by 18 percent last year, and is expected to increase an amazing 30 percent in 2015, making it — in percentage terms, at least — the fastest-growing airline in the country. But Spirit, which has been flying scheduled passenger service since 1992, is also the only U.S. carrier to hold a lowly two-star rating from Skytrax, the big airline quality monitor.
Frontier has been around even longer if you count the original Denver-based carrier that started up in 1950 but went bust after the airline deregulation wars. The modern incarnation of Frontier dates back to 2001, and it was acquired — after it went bankrupt — by Republic Airlines Holdings, an operator of regional carriers, in 2009. After a few years of trying, Republic couldn’t make Frontier work in a highly competitive Denver market (where United was dominant and Southwest was moving in fast), or in the other various markets where it tried to establish a niche, so in 2013 it sold Frontier to new investors — the private equity firm Indigo Partners, which turned Frontier into an ultra-low-cost carrier. That wasn’t really a surprise, since the man who runs Indigo Partners — William Franke — pioneered the concept when he ran Spirit Airlines.
So how do these two ATL interlopers stack up against each other? Both rely on one-class, single-aisle Airbus planes. The standard seats on Spirit’s A319s, A320s and A321s have a knee-crunching 28-inch pitch and seats that are less than 18 inches wide (“We’re a cozy airline,” Spirit admits on its website). The planes also offer a few better seats (four on A320/321s; 10 on A319s) called “Big Front,” with 36-inch pitch and 20-inch width, and of course they’ll cost you extra. At Frontier, standard seats have a more generous (by ultra-low-cost carrier standards) 30-31 inch pitch and seat width of 18 inches. Frontier’s planes also offer 30 (on A319s) or 36 (A320s) “Stretch” seats at an extra cost, with 36-38 inch pitch and 18-inch width.
Fares on Spirit are transportation-only, or as Spirit calls them, “fully unbundled.” If you want anything more than a seat and storage under the seat for a small personal item, you’ll pay more. At Spirit, that even includes water. If you don’t print your boarding pass at home, Spirit charges you $10 to do it at the airport. At Spirit, the cost for a carry-on bag ranges from $26 (if you pay online when you book) to $100 (if you wait until you’re at the gate to pay).
And checked bags carry fees as well, ranging from $21 to $100 for the first one. Want to select your seat before check-in? That’ll cost you from $1 to $50 for standard seats, or $12 to $199 for Big Front seats.
At Frontier, the fee for a carry-on bag ranges from $30 to $50 depending on when you pay, although Frontier does offer bundled fares that cost more but include some services. So for those who buy these Classic Plus fares (which allow full refundability, same-day standbys and no change fees) there’s no extra charge for a carry-on (nor is there one if you’re a Summit or Ascent-level member of Frontier’s Early Returns loyalty program). A checked bag costs $25-$30, again with exemptions for Classic Plus buyers and loyalty elites. Extra-legroom Stretch seats on Frontier are available free to Classic Plus fare buyers and to Summit and Ascent-level loyalty members; other passengers can upgrade for fees that start at $15. (Frontier also offers “Select” seats for fees starting at $5. These are just regular coach seats that happen to be closer to the front of the plane than the others.)
Both airlines also have loyalty programs that are pretty basic. Spirit’s is called Free Spirit and Frontier’s is EarlyReturns. Free Spirit is quite limited in its partner companies — just one hotel group, for instance (Choice Hotels International). Frontier’s plan is more traditional in that it offers tier levels that carry fee-waiving benefits, starting with Ascent level at 15,000 miles or 20 segments a year; Summit is 25,000 miles/30 segments.
So, frequent traveler… what do you think? Would you venture to fly on an “ultra-low cost carrier?” How do you think Delta will respond in Atlanta, or other legacies will respond in other cities? Please leave your comments below.
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