MSYtristar
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F9 Expected To Post A Loss

Tue Nov 29, 2005 12:48 pm

I'm not sure if this was covered or not, but here you go...

http://denver.bizjournals.com/denver.../2005/10/24/daily66.html?from_yf=1

The up and down financial saga of F9 continues. Surely they are doing better than most carriers, but one has to wonder if they can pull off a few consecutive profitable quarters as they did in the past? I'd like to see it, and it very well may happen, but I think WN's entry into DEN...even though not significant...is something that could potentially prevent that from happening.
 
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mariner
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 1:15 pm

Well, we'll see.

The date on that link is October 28, and yes, it was covered here when that (surprising) profit was reported.

Mr. Potter's comment is:

"the enormous fuel price increases we have incurred" since Hurricane Katrina slammed the Gulf Coast and the refineries there in late August. He estimates the third quarter will show fuel cost per gallon 20 percent higher than in the second quarter.

Since then, of course, the price of fuel has dropped a bit. We'll see.

cheers

mariner
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airtran737
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 1:18 pm

The biggest question is how will the upcoming arrival of Southwest effect F9's balance sheet?
Nice Trip Report!!! Great Pics, thanks for posting!!!! B747Forever
 
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mariner
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 1:28 pm

Quoting AirTran737 (Reply 2):
The biggest question is how will the upcoming arrival of Southwest effect F9's balance sheet?

DEN/MDW has been an ATA route (Southwest codeshare) for a while - and yields are shot to hell there because of that - so that won't change much. In any case, Ted's arrival on that route did the greater damage there.

Similarly, DEN/PHX was already ATA/(Southwest) and DEN/LAS is not famous as high yield for Frontier. For anyone?

From Frontier's point of view, it is a very gentle - if inevitable - Southwest invasion.

 Smile

cheers

mariner
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clickhappy
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 1:36 pm

If you have ever flown F9, and WN, you would think that F9 has nothing to worry about. While I enjoy flying Southwest I would prefer to fly Frontier, and would even pay a premium to do so.
 
iowaman
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 4:10 pm

The problem here is the WN name is known much more nationally than the F9 name, however I would imagine F9 is much more known in DEN. Also, WN is not going to just hurt yields from DEN to PHX/LAS/MDW, but to every city with available connections from those cities. WN had DEN- every city they fly to and where connections are available for $99 or less one way on DING! Sunday and all day Monday, and maybe even $79 if I remember right. That will put a dent in F9's yields. Good luck to both carriers.
 
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mariner
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 4:36 pm

Quoting Iowaman (Reply 5):
Also, WN is not going to just hurt yields from DEN to PHX/LAS/MDW, but to every city with available connections from those cities.

If you want to talk about connecting traffic, Frontier has been competing with Southwest for a long time.

MDW/SAN, for example. Or - I dunno - ABQ/BWI. Or - SCL/FLL. There are many more.

More crucially, the real low fare setter out of DEN - on one route - is not Southwest, but Northwest.

$99? $79? They should be so lucky. You can book DEN/MSP for $59 one way almost any time you want. I just checked it on Travelocity, again, for three different random dates.

It's been going on for a long time, and somehow Frontier survives it.

cheers

mariner
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SHUPirate1
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 5:23 pm

Quoting Mariner (Reply 6):
SCL/FLL

I don't think Southwest and Frontier are competing on that route at all. After all, do either of them even serve Santiago, Chile?  Silly

Edited to add smiley.

[Edited 2005-11-29 09:24:15]
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irelayer
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 5:51 pm

Quoting Mariner (Reply 6):
MDW/SAN

The only reason I would fly F9 on this route would be for the PTV's as B6 does not fly to Chicago and Song does not fly from SAN. That said, F9 is consistently more expensive than WN on that route and WN offers 3 to 5 N/S in addition to the other routings...

-IR
 
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mariner
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RE: F9 Expected To Post A Loss

Tue Nov 29, 2005 6:36 pm

Quoting SHUPirate1 (Reply 7):
After all, do either of them even serve Santiago, Chile?

Don't they? I am amazed.  wave 

Quoting IRelayer (Reply 8):
The only reason I would fly F9 on this route would be for the PTV's

Let's hear it for PTV's.

Quoting IRelayer (Reply 8):
F9 is consistently more expensive than WN on that route

That's good news, great for yields.

cheers

mariner
aeternum nauta
 
MSYtristar
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 4:32 am

Here's a new article talking about how Frontier could face a cash crunch:

http://yahoo.reuters.com/financeQuot...05-11-29_18-36-35_n29318909_newsml

I think it's vital for them to get more aircraft. They have a pretty sizeable operation for such a limited fleet.
 
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 4:44 am

Quoting MSYtristar (Reply 10):
Here's a new article talking about how Frontier could face a cash crunch:

Um - that is the standard disclaimer that appears on every SEC filing, listing every possible negative that the company - any company - might face.

The reason the stock fell is becaue Frontier announced plans to sell $80 million in convertible bonds -

http://biz.yahoo.com/ap/051129/frontier_airlines.html?.v=2

- underwritten by Morgan Stanley, which means the money is already there - and the warning was the standard disclaimer at the end of that filing.

cheers

mariner
aeternum nauta
 
MSYtristar
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 4:54 am

Quoting Mariner (Reply 11):
Um - that is the standard disclaimer that appears on every SEC filing, listing every possible negative that the company - any company - might face

I realize that, but it contained some items of interest, so I posted it. No harm in that.
 
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 4:59 am

Quoting MSYtristar (Reply 12):
No harm in that.

I didn't say there was any harm in it. I was simply pointing out the facts of it for those who don't know.

And adding the info about Frontier raising $80 million.  Smile

cheers

mariner
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azstar
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:23 am

Mariner reality check. Some people believe that F9 is a well managed, popular airline with a huge loyalty base. While Denver headquarters might contain a few of the brightest and best, the rest of the company is plagued with poor management, poor decision making, lack of planning, and many unmotivated personnel. And for those who believe that there is a large segment of the population who will pay a premium for advanced seat assignments and PTV, the truth is that 98% will not fly F9 if the fare is $1.00 higher than the competition. WN will probably cream F9 in Denver.
 
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:35 am

Quoting Azstar (Reply 14):
Mariner reality check.

Your reality, perhaps, but not mine.

Quoting Azstar (Reply 14):
the rest of the company is plagued with poor management, poor decision making, lack of planning, and many unmotivated personnel.

Um - I'm not sure what major decisions are made outside of Denver, or what planning is done outside of there.

Quoting Azstar (Reply 14):
And for those who believe that there is a large segment of the population who will pay a premium for advanced seat assignments and PTV

Um - what premium? You mean DEN/MSP at $120 round trip?

Quoting Azstar (Reply 14):
WN will probably cream F9 in Denver.

They may indeed. I cannot predict the future. But I thought Ted was going to do that?

cheers

mariner

[Edited 2005-11-29 21:36:31]
aeternum nauta
 
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clickhappy
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:38 am

Mariner - Why do you get so defensive when someone posts anything remotely negative about Frontier? it is almost comical, anytime an F9 post comes up you seem to get in to a disagreement with one or more posters, and it always seems to come down to semantics. It's weird!
 
MSYtristar
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:41 am

Quoting Azstar (Reply 14):
Some people believe that F9 is a well managed, popular airline with a huge loyalty base

No one can deny that the airline is very popular in Denver, but the same can't be said in other markets, since their market share is usually tiny at best with (at the most) limited local marketing.

Quoting Azstar (Reply 14):
While Denver headquarters might contain a few of the brightest and best, the rest of the company is plagued with poor management, poor decision making, lack of planning, and many unmotivated personnel.

During my three year tenure with F9, I witnessed a lot of what you have referred to. It was a mixed bag really. But it was no different than what went on at Vanguard when I was there. Pretty similar actually, but on a broader scale. It was a good company to work for, but every company has its problems.

Quoting Azstar (Reply 14):
And for those who believe that there is a large segment of the population who will pay a premium for advanced seat assignments and PTV

Regarding the PTV's, I sort of think would depend on the duration of the flight. They are not really used on a paid basis by many people on flights under two hours. But they come in handy for the longer transcons. It's a good novelty to have, but no, I wouldn't pay a premium for it. A book works for me.
 
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:49 am

Quoting Clickhappy (Reply 16):
Mariner - Why do you get so defensive when someone posts anything remotely negative about Frontier? it is almost comical, anytime an F9 post comes up you seem to get in to a disagreement with one or more posters, and it always seems to come down to semantics. It's weird!

Following Mariner's previous posts on F9, which are always intelligently written with good analysis, I'd say he's got a ton of money tied up in the stock. Or, alternatively, he's got relatives working for F9.  cheerful 
My other home is in the sky inside my Piper Cherokee 180.
 
Byrdluvs747
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 5:59 am

Quoting Azstar (Reply 14):
WN will probably cream F9 in Denver.



Quoting Mariner (Reply 15):
They may indeed. I cannot predict the future. But I thought Ted was going to do that?

I have to agree with Mariner. Contrary to those who drink WN's brown koolaid. The presence of WN doesn't always mean the death of that hub'b prominent carrier. HP has proven time and time again that a carrier can compete with WN and still profit.

F9 offers a better product than WN. I would imagine that many business pax would chose F9 over WN if given a choice.
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:04 am

Quoting RedFlyer (Reply 18):
I'd say he's got a ton of money tied up in the stock.

Not at the moment - I only have about 200 shares. I have had many, many more, but I have bought and sold over the years.

I was very, very tempted to buy a big bunch this morning, on the drop - but I missed it. By the time I got my act together here, the stock has started to rebound.

 

cheers

mariner

[Edited 2005-11-29 22:08:45]
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FlyGuyClt
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:08 am

Quoting Clickhappy (Reply 16):
Mariner - Why do you get so defensive when someone posts anything remotely negative about Frontier? it is almost comical, anytime an F9 post comes up you seem to get in to a disagreement with one or more posters, and it always seems to come down to semantics. It's weird!

Or he suggests you say things you don't say. But, we won't go there. Best of luck to Frontier.

Quality Equipment.
Quality People.
Quality Product.

Safe Flying  

[Edited 2005-11-29 22:14:32]
Florida Express, Braniff II and ......
 
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:12 am

Quoting Clickhappy (Reply 16):
ariner - Why do you get so defensive when someone posts anything remotely negative about Frontier? it is almost comical, anytime an F9 post comes up you seem to get in to a disagreement with one or more posters, and it always seems to come down to semantics. It's weird!

Frontier is my hobby. And I like to keep the facts straight - there is a great deal of misinformation presented here, including on this thread.

Sorry if it offends you. It isn't going to change.

You could always ignore me.  Smile

cheers
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LAXintl
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:12 am

At the end of the day, Frontier must develop some non Denver centered options. Having nearly all your eggs in a single hub has always been risky. Going forward anyways Denver can only absorb limited additional growth due to gate availability limits the carrier faces.

Whether Frontier should continue its Mexico build up, add significant point to point flying, or develop several focus cities are debatable, however non Denver centric options must be pursued if the company wishes to grow.
From the desert to the sea, to all of Southern California
 
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clickhappy
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:28 am

No, no need to ignore, I was just curious. You were one of the reasons I decided to give F9 a shot, after 12 segements in 5 weeks I am very happy with their service. I only wish they flew to more of the places I need to travel...
 
MAH4546
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 6:36 am

I've been hearing latley that there might be an announcement within a month or two regarding two new destinations, both in the southern US. Any one hear more?
a.
 
flashmeister
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 7:23 am

Some people believe that F9 is a well managed, popular airline with a huge loyalty base.

Well, some of these "some people" include a number of Wall Street analysts, who have a whole lot riding on the well-managed aspect of this statement. I'd trust their opinion more than a potentially disgruntled employees' statement... And, with the news this week and that "cash crunch" article garbage, lo and behold, their analyst coverage hasn't changed at all. Still rated overweight/buy by Merrill Lynch and JP Morgan, among others. Of course, they don't know anything about where the money is.

While Denver headquarters might contain a few of the brightest and best, the rest of the company is plagued with poor management, poor decision making, lack of planning, and many unmotivated personnel.

Unmotivated as evidenced by their #1 on-time ranking (see news release), right? Those planes are dispatched at remote stations by someone, I'd assume. Sounds like a motivated someone... Let's also not forget F9's success (albeit Denver-grown) growing year-to-date load factors by 4+ points and yields by 3+ points (see news release). Poor management indeed.

And for those who believe that there is a large segment of the population who will pay a premium for advanced seat assignments and PTV, the truth is that 98% will not fly F9 if the fare is $1.00 higher than the competition.

PTVs be damned, which is the more attractive itinerary below? Let's take PDX-BNA as an example:
Frontier: Depart PDX 620a, 40 min layover@DEN, arrive BNA 155p
Southwest: Depart PDX 615a, 1hr20min layover@LAS, an extra stop somewhere, arrive BNA 405p.

In the case above, for 25Jan on a one-way ticket, F9 beats WN by $8 anyway, but even if WN was cheaper, I know a whole lot of people who would prefer to get to their destination 2 hours earlier, without an extra stop alon the way, and with a shorter layover. So, while you might be right that PTVs aren't worth money to many passengers (although they are to some), time and ease of travel certainly are. Here, Frontier has WN beat.

WN will probably cream F9 in Denver.
Must be new math.
 
n471wn
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 7:47 am

The smartest thing that F9 could now do is establish a presence in COS......WN should have gone in there but since they did not then F9 needs to pick up this under used and great airport....Pacific Western proved that the demand was there as the Denver metro area is growing to the South.
 
flashmeister
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 7:52 am

The smartest thing that F9 could now do is establish a presence in COS......WN should have gone in there but since they did not then F9 needs to pick up this under used and great airport....Pacific Western proved that the demand was there as the Denver metro area is growing to the South.

First, the airline's name was Western Pacific. Second, and more importantly, their "experiment" failed and they went bankrupt, remember?

Frontier would be foolish beyond a means of comparison to establish any significant COS presence, if at all. DEN-COS isn't a market to waste resources on.
 
n471wn
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 8:20 am

From Flashmeister:....."and more importantly, their "experiment" failed and they went bankrupt, remember?"

Yes I do but they went downhill after they went into Denver. My sources tell me that if they had stayed at COS they would have survived....you are naive if you think that COS is not a diamond waiting to be found or else you do not know the Denver area.
 
PHXinterrupted
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 8:27 am

Quoting Mariner (Reply 6):
If you want to talk about connecting traffic, Frontier has been competing with Southwest for a long time.

Yeah, if you call losing money competing.
Keepin' it real.
 
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mariner
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 8:34 am

Quoting PHXinterrupted (Reply 30):
Yeah, if you call losing money competing

Hmm? I'm sorry, I don't understand.

Frontier is profitable for their financial year.

This may or may not continue, but I can't predict the future.

cheers

mariner
aeternum nauta
 
MattMSP767
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 8:36 am

Quoting Mariner (Reply 20):

I love all of your posts - You're a smart guy...people should take note from you.
 
Hillbilliescot
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 9:32 am

Quoting Dbba (Reply 29):
Yes I do but they went downhill after they went into Denver. My sources tell me that if they had stayed at COS they would have survived....you are naive if you think that COS is not a diamond waiting to be found or else you do not know the Denver area

I know West Pac would be huge right now. I wouldn't doubt it if West Pac would be flying international if they were still around. Since the demise of West Pac we (COS) have been hoping F9 would turn the tables on United and send flights from DEN to COS. It makes sense. If F9 offers competitive fares or even special fares like they do in DEN, F9 could make some big bucks picking up pax from all over southern Colorado, while picking up pax from northern Colorado going to DEN. Its a win/win situation.
 
flashmeister
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 4:06 pm

they went downhill after they went into Denver. My sources tell me that if they had stayed at COS they would have survived.

This isn't the case. Western Pacific began to have fairly serious problems well before the move to DEN. Being almost completely lesiure driven, they had a fairly hard time finding any success in bringing in higher fares (and thus being profitable), which prompted their entry into DEN and their rebranding to a more business-friendly image, which quickly failed.

you are naive if you think that COS is not a diamond waiting to be found or else you do not know the Denver area.

I'm neither. I was born in DEN, lived there at the height of the WestPac craze, and return regularly. I don't honestly think that COS is a "diamond" waiting to be found, particularly for Frontier. There are opportunities for COS to get new service from a variety of carriers, but its future is not likely to be a major hub. That's just the way the mop flops when you're the smaller town out of two main cities in a region.

PDX is another example -- we'll never be a megahub, but there are a few routes that I think AS has left on the table, and they're being taken up one by one by the other carriers.
 
azstar
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RE: F9 Expected To Post A Loss

Wed Nov 30, 2005 10:01 pm

TUS is 110 miles from PHX airport, and loses over 1 million passengers per year to PHX. COS probably loses considerably more to DEN due its proximity and the perception that the fares are always lower from the large hub, and the selection of flights is so much larger. It would be very difficult to establish any kind of major presence in cities like TUS and PHX since so much O&D traffic is diverted.

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