seatback
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Frontier On Titanic Watch List

Sat May 06, 2006 11:57 pm

Planebusiness.com has put Frontier on its Titanic Watch list (bankruptcy watch) saying that due to its weak RASM numbers, the airline needs to do something drastic, such as a merger, acquisition, new management etc...

Thoughts?
 
burnsie28
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RE: Frontier On Titanic Watch List

Sat May 06, 2006 11:59 pm

Well that have not made a profit in quite sometime, so it is possible.
 
luv2fly
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:02 am

You might want to see this thread for some insight.

Frontier - Survivng Southwest

http://www.airliners.net/discussions...eneral_aviation/read.main/2756375/
You can cut the irony with a knife
 
MaartenV
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:07 am

I have never heard of Planebusiness.com before, although that doesn't have to mean anything of course...

They have been ordering a couple of A320s lately so I guess the management themselves are not really that worried about the future, although (again) that doesn't have to mean anything of course...

RASM means something like Revenue Average Seat Mile right, so if that number is decreasing, I assume that means less yields? If they decreased it themselves (by lowering fares, to increase the number of seats sold) in a way that the revenue created by these extra chairs is bigger then the decrease in revenue of the other chairs, then it wouldn't necessarily be a bad thing.

If its caused by increased competition (healthier UA, WN entering DEN),or higher costs, or when they don't sell any extra seats, but just the same number for a lower price, then they could be in trouble.

Would replacing the (so far) reasonable successful management team really put them back on track (IF they are off). I think a merger would be more appropriate, since they might be to small to continue operating like a hub and spoke LCC in today's environment.
Its all about supply and demand...
 
NAV20
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:16 am

Sorry - I've been laying off Airbus recently (enough is enough) but I can't resist commenting on the perfect timing of this EADS press release:-

"Toulouse, 02 May 2006 - Frontier Airlines, of Denver, Colorado, has finalized a contract for six A320s, the first time the low-cost carrier has selected the aircraft type. The incremental order comes less than one year after Frontier converted to an all-Airbus operator. Also as part of the agreement, Frontier is converting four of its existing A319 orders to A320s, and four other previously ordered A319s to four A318s. Frontier will receive its ten A320 aircraft starting in early 2008 through 2010 and the A318 aircraft in 2007. In addition to these new Airbus orders, Frontier anticipates obtaining three additional A319 aircraft through arrangements with leasing companies."

http://www.eads.com/web/lang/en/1024...F00000000400004/6/03/31000036.html

[Edited 2006-05-06 17:20:33]
"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
 
seatback
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:19 am

F9's revenue growth last year was something like 1 percent compared to US's 20 percent. I'm not sure routes like SFO-LAX are going to cut it.

Planebusiness.com is a subscriber site that is well respected.

I love Frontier, from my days of living in Denver. I wish them well.
 
SPREE34
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:20 am

I don't believe Frontier's demise is any thing to worry about. If the sky did fall, think of what a nice addition to the New USAir the company would make. Good people, good equipment, overall good hub (DEN).
I don't understand everything I don't know about this.
 
MaartenV
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:24 am

Quoting SPREE34 (Reply 6):
Good people, good equipment, overall good hub (DEN).

Wouldn't a third western hub be a bit much for US?
Its all about supply and demand...
 
DLKAPA
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:28 am

Frontier's RASM rose in April compared to April the previus year, Yields rose over the same period, Load Factor rose (actually it's been a very long time since LF hasn't risen), they've played a very conservative game and are now confident enough to order a larger fleet type...why would they be going Titanic?
And all at once the crowd begins to sing: Sometimes the hardest thing and the right thing are the same
 
steeler83
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:37 am

Quoting MaartenV (Reply 7):
Wouldn't a third western hub be a bit much for US?

Maybe a focus city... They have a hub in PHX and a focus city in LAS. How many flights does F9 operate out of DEN?

Yeah, with the fall-out of F9 (which I DO NOT want to see...) US would get A319/A318 aircraft which would build up their fleet quite a bit. I was about to say that they could start to phase out their 733 and 734s but that is not necessary for them at this point I don't think...

I don't see US being the only beneficiary of such a thing though... What about UA? I was about to say B6 but they're downsizing their fleet last time I checked. That, and they don't fly A319s... UA I believe has A319s though.

Coming back to the US hub/focus city and the fact that UA has a considerable hub there, would US want another large operation where another star alliance carrier already has a hub?
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
SPREE34
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:19 am

Quoting MaartenV (Reply 7):
Wouldn't a third western hub be a bit much for US?

Yeah, I think it would. That's why I think I said overall. It would give US a greater presence than now, but I imagine a hub would be hard to justify.
I don't understand everything I don't know about this.
 
aa757first
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:46 am

Quoting SPREE34 (Reply 6):
If the sky did fall, think of what a nice addition to the New USAir the company would make. Good people, good equipment, overall good hub (DEN).

It's hard enough to integrate two fleets, two sets of equipment, two technology systems, two groups of employees, two route networks, etc without adding an additional set. It's safe to say US Airways would have no interest whatsoever in aquring Frontier, or any other carrier.

AAndrew
 
CWAFlyer
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:58 am

Planebusiness.com used to be the place to get the dirt on all the airlines.
The message boards were pretty good too, but about 5-6 years ago,
they made it a subscription service. I don't know anyone that
has a subscription, so I don't know if it's any good or not.
 
exFATboy
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 4:04 am

I used to read Holly's site before it went subscription, and even had a subscription for a little while. To paraphrase the joke about economists, she's correctly predicted 10 of the last 1 airline failures...

Quoting Steeler83 (Reply 9):
Coming back to the US hub/focus city and the fact that UA has a considerable hub there, would US want another large operation where another star alliance carrier already has a hub?

Well, I don't see a F9-US merger in the cards, but if there was, it'd be a sure sign that US is looking forward and seeing that UA may want them out of Star in the long run...
 
burnsie28
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 4:05 am

Just because an airline orders planes in bad times doesn't mean anything. NW converted its options for A330's in BK. Of course companies are going to plan for the fact that they will make it out just fine. It doesnt mean anything that they ordered or converted planes, or even taken delivery of them. Just because your not doing well doesnt mean you are going to stop taking planes and such. NW is still taking all of theirs on-time for example.
 
F9Animal
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 4:16 am

Oh man. How in the hell can someone compare F9 to the Titanic?

F9 has very little debt and loans. If F9 wanted to borrow, they have enough of a good credit rating to do so.

How many payments has F9 faulted on? How many vendors are requesting cash for service?

Was US put on the "Titanic" list? NW, DL, UA, B6, and TZ?

And one other thing..... It sure is hard to hit an iceberg at 35,000 feet.

Mariner!!! Give us some insight!  Smile

[Edited 2006-05-06 21:18:20]
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N1120A
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 4:28 am

Quoting SPREE34 (Reply 6):
If the sky did fall, think of what a nice addition to the New USAir the company would make. Good people, good equipment, overall good hub (DEN).

And a quick exit from the Star Alliance

Quoting Steeler83 (Reply 9):
What about UA? I was about to say B6 but they're downsizing their fleet last time I checked. That, and they don't fly A319s... UA I believe has A319s though.

United flies A319s and A320s but they use IAE V2500 engines, not CFM56 like F9. Also, they are in no position to buy anyone.
Mangeons les French fries, mais surtout pratiquons avec fierte le French kiss
 
socalfive
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 4:34 am

Quoting SPREE34 (Reply 6):
I don't believe Frontier's demise is any thing to worry about. If the sky did fall, think of what a nice addition to the New USAir the company would make.

Too much too soon for US, the fit is with Jetblue, it gives them the badly needed west coast ops.
 
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mariner
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 5:14 am

Quoting Seatback (Reply 5):
F9's revenue growth last year was something like 1 percent compared to US's 20 percent. I'm not sure routes like SFO-LAX are going to cut it.

Hmmmm? Yes, US Airways April RASM was up over 35%. Continental's was about 11%.

Frontier reprted a RASM increase of over 6%. A number of analysts are cheering this, because it is up at all, in spite of Southwest:

http://today.reuters.com/investing/f...IRLINES-FRONTIERAIRLINES-STOCK.xml

http://custom.marketwatch.com/custom....6721528704-872417075&alias=/ht/nw

Quoting Socalfive (Reply 17):
the fit is with Jetblue, it gives them the badly needed west coast ops.

Oh, please - I really don't want to see Frontier sacrificed to the ego of David Neeleman.

cheers

mariner

[Edited 2006-05-06 22:17:06]
aeternum nauta
 
L1329II
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 5:33 am

Quoting Mariner (Reply 18):
Oh, please - I really don't want to see Frontier sacrificed to the ego of David Neeleman.

Oh come on hes not that bad... but I get your point. I doubt that will happen. Does B6 want the hassle of unions? Doesnt F9 have an FA union? What will they be willing to bear?

Also do they have the capital to do so? And with B6's losses this year it wouldnt make sense for anyone to invest in the aquisition or not make sense for B6 to get themselves involved with this if they have issues of thier own!

Although, unions aside, this would be a perfect matchup.
"By the way, is there anyone on board who knows how to fly a plane?"
 
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mariner
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 5:44 am

Quoting L1329II (Reply 19):
Oh come on hes not that bad...

To start an airline? I think he is great, I'd want him on my team, he is a media darling.

To run an airline on an ongoing basis? I have a different opinion.

mariner
aeternum nauta
 
PSA727
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 6:48 am

If Frontier were to merge, or be acquired by anybody, my money
would go to AirTran, even though they operate different fleets.

AirTran has experience going up against a goliath (DL in ATL), so
that would help them with UA in DEN. It also gives them a
much needed presence in the western states.

As for US...they already code-share with UA out of DEN and their
LAS and PHX hubs can basically cover the same region.

Or F9 can just shutter-up like Independence Air, but I still think that
is still a long ways off from now.
fly high, pay low...Germanwings!
 
Kohflot
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 7:15 am

Frontier in trouble?

How bout a purchase by Southwest, run as a completely seperate entity?

Southwest could then get all the lovely A-concourse gates at DEN. All the Airbii could be moved to DFW and create a nice new little hub in the D and E concourses - eventually complete with a broadened Mexico schedule.. say, to CUN, CZM, MEX, BJX, GDL, MTY, SJD, MZT, PVR for starters (assuming there's availability in the 'slot'-controlled routes).. maybe even throw in a few Central America or Caribbean routes.

Eventually, the Airbii could be expanded to international flights from HOU, SAT, ELP, ABQ, and PHX.. effectively working as the south-of-the-border arm of WN..

Such a combination would:

* 'Take out' F9 as Boyd prognosticates without actually destroying the revenue F9 brings in

* Put the hurt on UA and AA simultaneously

* Give RapidRewards members access to international markets

* Compete with CO in US-Mexico markets

* Put the costly Wright fight on hold for the time being

* Keep DFW's E-gates out of someone else's hands (sure, no one wants them now, but that'll change)

* Shield the WN route system from the complications of international flying


I think the only downside would be consumer confusion with seat assignments and boarding a WN/F9 plane at DFW with different amenities than a WN 737. But, how long is it before WN has assigned seating anyway?

[Edited 2006-05-07 00:17:43]
Ask why..
 
socalfive
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 8:32 am

Quoting L1329II (Reply 19):
Although, unions aside, this would be a perfect matchup

JetBlue has to face Union Labor sooner or later, they all do.

Quoting PSA727 (Reply 21):
If Frontier were to merge, or be acquired by anybody, my money
would go to AirTran, even though they operate different fleets.

Too different for the intelligence of Airtran management to consider for even a second. Airtran/Alaska, fleet and routes work

Quoting Kohflot (Reply 22):
think the only downside would be consumer confusion with seat assignments and boarding a WN/F9 plane at DFW with different amenities than a WN 737. But, how long is it before WN has assigned seating anyway?

The downside is thinking there's any part of this idea that works. WN may go forever without assigned seating. They study it closely, so far, they haven't felt the need. It's quicker to turn the plane without it. Remember, what isn't broke doesn't need a friggin fix.

Don't laugh, in 2002 I predicted the US/HP merger, long before even Doug Parker. Routes/Fleets and weaknesses strengthened through merger. Look it over. The success of the US merger is proving a new round of consolidations is coming soon, stay tuned.
 
L1329II
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 9:21 am

Quoting Mariner (Reply 20):
To start an airline? I think he is great, I'd want him on my team, he is a media darling.

To run an airline on an ongoing basis? I have a different opinion.

I absolutely agree. Time to rip him out of the right seat. Maybe he needs to do something like Bill Gates and "step aside as CEO thing..." and let someone else "run" the company.
"By the way, is there anyone on board who knows how to fly a plane?"
 
flashmeister
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 10:13 am

As much as I hate to say it (being a F9 shareholder), I sort of see where Holly is coming from with her prediction. I'm a PlaneBusiness subscriber, and I read what she wrote about F9, and she's not far off.

To paraphrase, these are the reasons she's putting Frontier on the Titanic Watch:

  • She thinks that LAX-SFO is a mistake. She does have a point that even Southwest had trouble sustaining that route (before dropping it ultimately).
  • Frontier was able to obtain higher revenue (1.1% higher) last quarter, but nothing like the revenue gains posted by FL and US (in the neighborhood of 20%). The demise of Independence Air helped FL and US, however.
  • Expansion programs (especially LAX) in the past two years have been only moderately successful
  • F9 has lost a number of leaders to other carriers. Key leadership defected to Air Canada and Midwest, and new blood has not stepped up to the plate to play a visionary role
  • The airline hasn't shown much innovation in terms of planning new routes or services
  • They have relatively little cash (despite their credit access)
  • More competitve pressure is certain to be felt at DEN
  • The current management team is more likely to stay the troubled course instead of making some large changes that she thinks are necessary


Holly compares Frontier's position today to that of America West a year ago, albeit slightly worse because of Frontier's smaller scale and the lack of a visionary leader like America West had at the time.

I can't say that I totally blame her. What's especially alarming to me is the sea change that's taken place between Frontier and Midwest: a year ago, Midwest was totally on the ropes. Their latest quarter, while still a loss, showed suprisingly strong and upbeat numbers. Frontier's did not. Frontier's former Vice-President of Planning and Revenue Management, Greg Aretakis, joined Midwest in April 2004. Sean Menke, Frontier's former Chief Operating Officer, left the airline in July 2005 to become the Chief Commerical Officer of Air Canada.

Look how F9's fortunes have turned since then... not exactly a coincidence, from my view.

[Edited 2006-05-07 03:15:04]
 
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mariner
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 10:51 am

Quoting Flashmeister (Reply 25):
She thinks that LAX-SFO is a mistake. She does have a point that even Southwest had trouble sustaining that route (before dropping it ultimately).

It's a valid opinion. But it is a very minor route. I doubt the airline stands or falls by that one route. I hope not.

And, as I understand it, Southwest's problems were weather related. Her brother, who works at Southwest, would have been able to tell her.

Quoting Flashmeister (Reply 25):
Frontier was able to obtain higher revenue (1.1% higher) last quarter, but nothing like the revenue gains posted by FL and US (in the neighborhood of 20%). The demise of Independence Air helped FL and US, however.

I am not sure which quarter you are talking about. To my knowledge, Frontier has not reported the Jan-Mar quarter (the first "Southwest at DEN" quarter) . So if it is Oct-Dec, then - um - Cancun? Fuel?

Quoting Flashmeister (Reply 25):
Expansion programs (especially LAX) in the past two years have been only moderately successful

I'd have said that LAX was a flat out failure, but it ties in with the next point - who devised those programs?

Quoting Flashmeister (Reply 25):
F9 has lost a number of leaders to other carriers. Key leadership defected to Air Canada and Midwest, and new blood has not stepped up to the plate to play a visionary role

The people who thought up the LAX focus city - Menke/Aretakis - have left. Is this a good thing or a bad?

Quoting Flashmeister (Reply 25):
The airline hasn't shown much innovation in terms of planning new routes or services

Canada? The holding company?

Quoting Flashmeister (Reply 25):
They have relatively little cash (despite their credit access)

Hmmmm? They almost doubled their cash base on a y-o-y basis. From the January quarterly report:

"The airline's current unrestricted cash and short-term investments and working capital as of December 31, 2005 was $222.7 million and $113.9 million, respectively. This compares to the Company's unrestricted cash and short-term investments and working capital for the same period last year of $149.0 million and $55.9 million, respectively."

They have never had so much money in the bank.

Quoting Flashmeister (Reply 25):
More competitve pressure is certain to be felt at DEN

That's true. Thus - perhaps - the holding company?

Quoting Flashmeister (Reply 25):
The current management team is more likely to stay the troubled course instead of making some large changes that she thinks are necessary

Ummm - the holding company? if they do start a Mexican subsidiary - or a regional one - that is hardly "staying the trouibled course".

Quoting Flashmeister (Reply 25):
Midwest was totally on the ropes. Their latest quarter, while still a loss, showed suprisingly strong and upbeat numbers.

Only two quarters ago, Frontier made a handsome profit. The loss in the Oct/Dec quarter is almost directly attributable to the loss of Cancun (and fuel).

I doubt this quarter will be good because it is - again - the first "Southwest" quarter

But - um - Titanic? There's Holly for you - she never saw a bandwagon she didn't love.

 Smile

mariner
aeternum nauta
 
brokenrecord
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 11:14 am

I've never thought about an F9-US merger before, but now that I do, I could some positive things about that.

1. Fleet commonality
2. The DEN hub could be downsized to a focus city and allow more connections to UA trans-Pac flights

Could be an expensive task to add F to the F9 birds though.
 
flashmeister
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 11:35 am

Mariner-

I never said that I agreed with all of her points, just laying them out for those who can't see the article.  Smile

I do feel, however, that Frontier is a bit rudderless about now. I'm not excited about Canada routes after seeing WestJet's abysmal performance a few months ago on its US entries, and the holding company is fine if something is done with it, which hasn't yet been the case.

Remember that Holly's job is to provide insight onto investing in the industry. I think that she has a valid point to say that Frontier is an iffy investment to get into right now, since we're not sure how bad the first Southwest quarter really will be, and since it's clear that Southwest wants to grow at DEN to be much bigger than they are now. Plus, Frontier, while having more cash than ever, doesn't have the war chest to sustain war for as long as Southwest does.

I own quite a bit of F9 stock, and I'm not getting out of it... but I probably wouldn't buy into it right now, either.

Your point about personnel is well-taken, except that in addition to LAX, these guys also found some pretty stellar opportunities and executed on them. I think that it's fairly clear, to me anyway, that the braindrain that goes along with these sorts of departures has hurt the airline.

Thing is, both Frontier and jetBlue are facing some developments in revenue and planning that they haven't taken on before. If one or both of them get into real trouble (since neither is at the level of "real trouble" financially yet), I can't help but think that a merger would be pushed. The carriers' products (not cultures) are just too similar to ignore.

In a battle of Neeleman vs. Potter for CEO, I don't know who wins, but Neeleman has a history of walking away from mergers...
 
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mariner
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 12:23 pm

Quoting Flashmeister (Reply 28):
Remember that Holly's job is to provide insight onto investing in the industry. I think that she has a valid point to say that Frontier is an iffy investment to get into right now,

To suggest it is an iffy investment right now is absolutely okay. Several other - better - analysts have done it, why not she? The J P Morgan analysts did it at the beginning of last week.

But - Titanic Watch?

Maybe things have changed since the days when I knew Holly, but "Titanic Watch" used to be reserved for airlines that might appear to be on the brink of going under. As did the Titanic.

If Frontier is at that point, I must have missed something. I would also be amazed that they were able to raise $90 million in the rights issue.

So - I would also be interested to know when she published - before Thursday evening or after. Or, at least, when did she commit herself to that decision.

And I do recall that about three years ago, Holly was insisting that Frontier should make what she called "the difficult call to Airbus" and cancel their orders.

I'm pleased the CEO did not take her advice.

mariner
aeternum nauta
 
WesternA318
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 1:17 pm

Quoting Mariner (Reply 18):
Oh, please - I really don't want to see Frontier sacrificed to the ego of David Neeleman.

Of course not, but then again, it would be better than a Don Burr perhaps?
Check out my blog at fl310travel.blogspot.com!
 
TWAAF9
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 1:24 pm

I used to follow the forum on planebusiness, but haven't since they switched to the pay format.

At any rate, what is Holly's track record? I haven't read anything from her since (probably) college, and I honestly can't remember any other predictions that have panned out.
Ahh, the power of SABRE...
 
steeler83
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 1:37 pm

Quoting N1120A (Reply 16):
United flies A319s and A320s but they use IAE V2500 engines, not CFM56 like F9. Also, they are in no position to buy anyone.

And US also uses the CFM56 like F9 as well, and given the case with UA, I guess US would be the only beneficiary from a F9 fallout... But, I do have to say... I don't see a F9 fallout happening any time soon really; I like the way they're doing business and expanding... They are growing and expanding, but not at a suicidal rate like B6 or WN... They're taking it one step, one plane, one city at a time, pretty much...
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
JetCaptain
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 1:39 pm

Quote:
I haven't read anything from her since (probably) college, and I honestly can't remember any other predictions that have panned out.

Around a week before Southwest announced they were moving into DEN, she recommended Frontier stock as one of her top picks.

JC
 
wjcandee
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 2:35 pm

Quoting TWAAF9 (Reply 31):
At any rate, what is Holly's track record?

She has a great track record at being a shill for the views of the major carriers who kiss up to her. She purports to be an analyst, but I personally don't put much faith in her predictions. But like a stopped clock...
 
We're Nuts
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:19 pm

Quoting MaartenV (Reply 7):
Wouldn't a third western hub be a bit much for US?

Since when does US keep the companies it buys? Besides, a DEN hub would be far too convenient.
Dear moderators: No.
 
gregtx
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:21 pm

They are trying to restructure their payment schedules for leased aircraft directly with the foreign banks to reduce costs and cycle payments more evenly throughout the year. While not unhead of, it makes other creditors and some investors nervous.

At this point, it's Much Ado About Nothing---and likely an astute move to reorganize cashflow before 'having' to do it if the situation gets worse.
 
We're Nuts
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RE: Frontier On Titanic Watch List

Sun May 07, 2006 3:30 pm

Quoting Steeler83 (Reply 32):
They are growing and expanding, but not at a suicidal rate like B6 or WN...

If you are willing to put money where your mouth is, I'd be happy to make a bet that there is nothing "suicidal" about Southwest's growth.
Dear moderators: No.
 
F9Animal
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 2:21 am

Quoting Wjcandee (Reply 34):
She has a great track record at being a shill for the views of the major carriers who kiss up to her. She purports to be an analyst, but I personally don't put much faith in her predictions. But like a stopped clock...

Wow, she is not a very faithful frequent flyer of Frontier obviously. I begin to wonder if she has ever flown on F9? I bet she would change her thought process if she had tried it.

I wonder if she has ever been on the Titanic? Do you think she knows that Icebergs are not at 35,000 feet?

[Edited 2006-05-07 19:22:53]
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GentFromAlaska
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 3:08 am

Frontier as long as I've been monitoring them (1996) has always been the little engine that could. Every once in a while they hit a pocket of turbulence but keep on trucking.

I would like to see them initiate one stops in select markets. I've often thought BNA would be a perfect focus city and or mini hub for their east coast Ops. There is plenty of room for them to grow in Nashville. DEN-BNA-MCO, DEN-BNA-BWI are two examples. F9 can still fly the non-stops in these markets, but throw in a single one stop.

A wish list item would be for them to incorporate a bereavement fare, into their fare structure, more so for their Alaska ops. Alaskans just can't hop in the car and drive to the lower forty eight, when time is of the essence.  crossfingers 
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steeler83
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 3:42 am

Quoting We're Nuts (Reply 37):
If you are willing to put money where your mouth is, I'd be happy to make a bet that there is nothing "suicidal" about Southwest's growth.

I wasn't saying that WN's growth is suicidal for "WN..." It would be, however, for F9, a much smaller airline that doesn't have the financial background that WN has... If I am still digging a hole here, by all means, shut me the hell up...  

Then again, perhaps they could expand at that kind of a pace, and maybe they're afraid of taking that kind of a risk. There is another thread on here that states, pretty much, that F9 is doing a pretty good job with competition against WN at DEN...

[Edited 2006-05-07 20:44:39]
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antoniemey
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 4:12 am

Quoting GentFromAlaska (Reply 39):
I would like to see them initiate one stops in select markets. I've often thought BNA would be a perfect focus city and or mini hub for their east coast Ops. There is plenty of room for them to grow in Nashville.

Would be nice... except for the lack of baggage claim office space and the fact that the only available gates that are actually together and usable as a group are on teh C councourse at the opposite end of the airport from their ticket counter. There is more counter space available for them to take, but only on the A councourse block. They currently inhabit the former TWA counter space and gate area, but they have to do baggage claim ops out of their ticket counter.
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We're Nuts
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 4:56 am

Quoting Steeler83 (Reply 40):
I wasn't saying that WN's growth is suicidal for "WN..." It would be, however, for F9, a much smaller airline that doesn't have the financial background that WN has...

Thank you for clearing that up.  Smile
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king
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 5:11 am

Would WN be saying "iceberg, right ahead" if they were paying current fuel prices? I wish I could see what's going to happen a few years from now when WN's fuel hedges expire.
 
We're Nuts
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 5:25 am

Quoting King (Reply 43):
Would WN be saying "iceberg, right ahead" if they were paying current fuel prices? I wish I could see what's going to happen a few years from now when WN's fuel hedges expire.

No, they would not. Don't be ridiculous. Even at current prices WN would be profitable. WN is a living, breathing company that adapts to market forces. History has shown they do that better than any of their competitors, and that's why they remain profitable through the tough times.
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king
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 5:36 am

Not being ridiculous. Just been reading other threads.

Quote "I wish you were correct, but in WN's 1Q results announced April 20, the company reported net income of $61 million, which included a $133 million benefit from hedging. Without the hedges, ostensibly, WN would've reported a $72 million net loss."

Times are changing.
 
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mariner
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 5:40 am

Quoting We're Nuts (Reply 44):
Don't be ridiculous.

Why be rude? It is a perfectly valid question.

There is considerable debate as to whether or not Southwest would be profitable absent the fuel hedges.

It isn't simply the hedges themselves, there are many other factors that come in to play. One example - the company tax due if they are profitable that wouldn't be due if they were not.

Quoting We're Nuts (Reply 44):
and that's why they remain profitable through the tough times.

Certainly that is true. And one reason for that - now - is the price Southwest pays for fuel.

You might want to do a search in the archives - there are strong Southwest supporters in this forum who have said that without the fuel hedges, Soutwest's profitablity might be questionable.

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flashmeister
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 6:15 am

She has a great track record at being a shill for the views of the major carriers who kiss up to her.
I somehwat agree... although in the interest of fairness, she's been very hard lately on management at UA and DL, and was the target of a (settled) lawsuit from Mesa CEO Jonathan Ornstein after some less-than-flattering remarks.

I begin to wonder if she has ever flown on F9?
I don't remember exactly when, but I do recall a trip report of hers that was on Frontier. She had very good things to say, as I recall.

There is considerable debate as to whether or not Southwest would be profitable absent the fuel hedges.
Southwest's first quarter earnings press release makes it fairly clear that the carrier would not have been profitable. They reported profits of $61 million, but later in the press release acknowledged a $133 million benefit from their fuel hedges. Take the benefit away, and the profit disappears. Their income tax provision was $35 million, which would disappear for an unprofitable carrier.

So: $61 - $133 (hedge benefit) + $35 (income tax provision) = a loss of about $37 million.
 
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mariner
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 6:22 am

Quoting Flashmeister (Reply 47):
I don't remember exactly when, but I do recall a trip report of hers that was on Frontier. She had very good things to say, as I recall.

She has flown on Frontier a number of times. However, there is a history with the airline.

She has profound respect for Sam Addoms, the Founder/CEO, she is - or has been - less thrilled with the new management.

There was also an issue involving one of her best friends, who left Frontier under odd circumstances, which seem to involve a (new then) most senior exec.

At about that time, she certainly took "a shine against" Frontier. It was within that time frame that she stated the airline should make the call to Airbus.

mariner
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flashmeister
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RE: Frontier On Titanic Watch List

Mon May 08, 2006 6:32 am

However, there is a history with the airline.
Yeah, I remember that -- something to do with Elise Eberwein, currently at US Airways and part of the America West team. Since then, though, she's had generally only good things to say about Jeff Potter with the exception of this past issue and the holding company (which she didn't seem too excited about, but didn't actively call for it to be defeated either).

If she had a bias against Frontier, it certainly went away before she called Frontier as one of her top stock picks for the 4th quarter last year. That wasn't a good call, as it turned out, but she was definitely bullish on the airline 6 months ago or so.

I do agree that the assessment of "Titanic" seems to be out of place considering previous members of that list, which if I recall correctly, included Independence, TWA, Vanguard, and at one point, United. In fact, it seems really out of place when you consider that Delta isn't on the list and it's a union vote away from being history.

OK, so I've changed my mind. Titanic Watch isn't warranted, but writing about being extremely concerned about the airline's performance (in boldface) is.

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