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flymco753
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Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 12:41 am

A quite controversial topic about mergers is on Spirit and Frontier; will they ever become 1?

You could say yes because of:
•same aircraft type
•similar business models (ULCC)
•targeting the same customers
•similar amenities and awards programs

Those, like myself, say no because:
•different power plant types
•different route structures and goals
•conflicting hub locations
•brand recognition in differen geographies
•lower hand opportunity

When it comes to route structures specifically, Spirit is very conservative about the destinations they add and expand out of, where F9 heavily uses the dartboard method, something Spirit has no interest in. Also, F9 just finished their Headquarters in Denver, but Spirit wants to stay in Fort Lauderdale to keep costs as low as possible. Essentially there’s a conflict between the 2 airlines.

Spirit focuses heavily on Detroit, Orlando, Myrtle Beach, Fort Lauderdale, and Las Vegas as well as newer stations like Baltimore whereas Frontier focuses heavily on Denver, Chicago, Philadephia, Orlando, Atlanta, Austin, etc.

What are your thoughts?
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RamblinMan
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 12:56 am

Spirit is not exactly small in ORD, ATL, or MCO either. They offer a similar product, and the route maps would complement each other. As far as brand recognition, I think they're equally despised. I'm not a fan of further consolidation but this one definitely looks like the most likely to happen.
 
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FA9295
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 1:13 am

It could be possible, although definitely not anywhere in the near future for sure. It would make the competition in the ULCC market much thinner, and would thus, be able to target more customers in the long run. I'm not sure what you mean by "conflicting hub locations". As someone else already pointed out, they have very similar focus city locations (such as ORD, ATL, MCO). If they were to merge, I think each of the two airlines would make their case as to why the airline should be headquartered where (either Denver or Fort Lauderdale). I'm not sure which airline name would survive (what the merged airline would be called, either "Spirit" or "Frontier"). I guess it would heavily depend on whether it would be a "true merger", or if one of the airlines filed for bankruptcy and got bought out by the other airline.
 
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AAlaxfan
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 1:19 am

I can see Spirit and Frontier merging. Spirit fills in a lot of dots in the Caribbean and Central America while Frontier fills dots in the west and Midwest. There's quite a lot of overlap in the northeast, Florida and the east coast, but considering their sizes that shouldn't be a problem. As far as hubs, that really shouldn't be a problem, as they can pick any of their current stations that isn't hubbed by a legacy and just build there. LAS, MCI, RSW, FLL, MYR, CVG are a few that come to mind.
Grumpy. Not a dwarf, not an attitude. It's a lifestyle.
 
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flymco753
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 2:04 am

The thing is though, both airlines are completely different when it comes to their route structure. Spirit wouldn’t put up for F9’s dartboard approach.
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brian415
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 2:15 am

I think F9 and NK will forgo a merger. I see the possibility of Allegiant wanting to get in bed with Frontier. G4 is already 66% done with dumping MD-80s. Also, as another poster mentioned F9 loves the dartboard and so does G4.
 
ShinyAndChrome
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 2:18 am

Possible, sure. Probable even, when considering the possible money at stake if/when Indigo Partners finally cashes out. I can't say inevitable, though. While they may be off their all time peaks, both carriers are still quite healthy as independent entities. This isn't a VX scenario by any means.
 
cschleic
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 2:35 am

Anything's possible. But it seems that one of the usual reasons comes up....fleet commonality, except that doesn't have anything to do with mergers. AS and VX. WN and AirTran. DL and NW. AA and US. They all had very different fleets. It's not the reason to merge.

G4 is a tour company that also has an airline, very different model than the others. And considering how successful both F9 and NK have been, maybe there is room for two ULCCs in the industry, just as there is room for the US3 and Southwest. There's still a lot of geography out there to be had.
 
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einsteinboricua
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 2:46 am

cschleic wrote:
Anything's possible. But it seems that one of the usual reasons comes up....fleet commonality, except that doesn't have anything to do with mergers. AS and VX. WN and AirTran. DL and NW. AA and US. They all had very different fleets. It's not the reason to merge.

The only unlikely pairs due to fleet incompatibility were AS/VX and DL/NW, and even then, the DL/NW commonality was marginally different due to the DC-9s and 757s that NW brought, the former of which you can say were distantly related to the MD80s and MD90s DL has.

WN and FL = 737. The 717 fleet was minimal and WN knew it could find a buyer/leaser immediately.
AA was already (or close to) receiving A32Xs when it merged with US, and US brought in a small, but still common, 757 fleet.
"You haven't seen a tree until you've seen its shadow from the sky."
 
UGA777
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 3:08 am

The 717 was not minimal for FL, it was the majority of their fleet. They had 88 717s and 52 737s at the time of the WN acquisition. Fleet commonality plays less of a role than eliminating a competitor.
 
AWACSooner
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 3:43 am

flymco753 wrote:
Spirit wouldn’t put up for F9’s dartboard approach.

Really? I beg to disagree...NK's approach in the past when they've moved into an airport is more akin to strip mining...they move in and launch half a dozen (or more) routes from that new city...and end up canceling a good 1/3-1/2 of them within a year. Basically, they take the low hanging fruit and move on in a lot of cases.

So maybe they're good for each other.
 
deltadudejg
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 3:52 am

My opinion F9 is better suited to merge with G4. Fleets and routes align better,
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FlyinRabbit88
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 4:06 am

For all the speculation and the unknowns in the industry, JetBlue could in theory make a play on Spirit. Could get the greater west coast presence, and point to points, more exposure in the Midwest, and put a stranglehold on FLL and the Caribbean LCC market. Have the extra airframes to increase MINT, and give its system breathing room and limit exposure during IROPs.
Of course this is all speculation and you never what will or could happen.
 
StrandedAtMKG
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 4:25 am

Maybe it's just because there's been speculation here for a while now, but I am of the opinion that a merger between F9 and NK is just a matter of time. NK is doing everything they can to run their brand right into the ground (A yellow and white livery modeled after taxicabs? Gee, there's a positive association you really want to make in Middle America.) F9 seems like a rudderless ship with no real strategy except picking up teeny, tiny barely-profitable crumbs left over from the Big 4. At least a merger would give them a little bit more critical mass to compete with the bigger airlines. Without it, they're both condemned to be bit players for the rest of their existence.
 
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XLA2008
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 4:33 am

Spiritier... lol, not flown on either. But don’t see a merger in the near future
“For once you have tasted flight you will walk the earth with your eyes turned skywards, for there you have been and there you will long to return.“
 
Flaps
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 4:41 am

brian415 wrote:
I think F9 and NK will forgo a merger. I see the possibility of Allegiant wanting to get in bed with Frontier. G4 is already 66% done with dumping MD-80s. Also, as another poster mentioned F9 loves the dartboard and so does G4.


G4 most certainly does not love the dart board approach. It may appear from outside that they do but the reality is far from it. They know exactly what they are doing when it comes to new markets and they don't make many mistakes. Their model is quite different from both NK and F9. G4 would stand to gain nothing from either carrier. They wouldn't even benefit from fleet acquisitions as the lease rates on the newer planes flown by NK and F9 do not fit the the low cost of acquisition that supports G4's low utilization. G4 is just fine as it is.
As for F9 and Spirit there would appear to be some possibilities there. My impression of those two is that F9 has somewhat better service but NK is somewhat better run. In terms of what benefits the traveling public, I don't think any more mergers are needed. I shudder to think of the [email protected] that would occur trying to integrate those two carriers operationally.
 
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hOMSaR
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 5:02 am

I’m curious (since fleet/engine commonality were both #1 on the OP’s yes/no reasons list), where did this idea come from that fleet commonality has anything to do with merger decisions? Has there ever been a merger that happened specifically because of fleet commonality? Has there ever been a credible case where a merger would have happened, but didn’t because of incompatible fleet types? This meme refuses to die, yet there seems to be little relevance to reality.
I was raised by a cup of coffee.
 
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flymco753
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 5:08 am

deltadudejg wrote:
My opinion F9 is better suited to merge with G4. Fleets and routes align better,
Thank you!
...the carriage of liquids, gels, and aerosols are prohibited through the screening checkpoint except for travel size toiletries of 3 ounces or less...
 
Bobloblaw
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 5:58 am

what is the benefit of these airlines merging?
 
DarthLobster
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 6:11 am

Bobloblaw wrote:
what is the benefit of these airlines merging?


Less competition and more A.Net chatter.

On that note, I predict at least one if not both will be part of B6 in 10 years.
 
santi319
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 6:27 am

DarthLobster wrote:
Bobloblaw wrote:
what is the benefit of these airlines merging?


Less competition and more A.Net chatter.

On that note, I predict at least one if not both will be part of B6 in 10 years.


Out of all of them people forget NK has ZERO debt and $1Billion in the bank and counting.

If anything NK is the one that calls the shots on a potential future merger...
 
caverunner17
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 6:30 am

StrandedAtMKG wrote:
Maybe it's just because there's been speculation here for a while now, but I am of the opinion that a merger between F9 and NK is just a matter of time. NK is doing everything they can to run their brand right into the ground (A yellow and white livery modeled after taxicabs? Gee, there's a positive association you really want to make in Middle America.) F9 seems like a rudderless ship with no real strategy except picking up teeny, tiny barely-profitable crumbs left over from the Big 4. At least a merger would give them a little bit more critical mass to compete with the bigger airlines. Without it, they're both condemned to be bit players for the rest of their existence.

Every F9 and NK flight I've been on out of ORD or DEN has been a full or almost full flight. Including the odd 11PM or 6AM depatures. NK's branding is unique. But it's not too different than other ULCC's like Air Asia or Scoot. If anything, Legacies going to Basic Economy fares without carry-ons might even make the ULCC's more popular.

While I wouldn't be surprised to see a merger, it seems like both Frontier and Spirit have been operating in the green.
 
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PatrickZ80
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 7:17 am

Also keep in mind that Frontier isn't entirely an independant airline, they're part of Indigo Partners which also holds Wizzair, Volaris and JetSmart. So in case of a merger, what would happen? Would Indigo Partners acquire Spirit, or would Spirit buy Frontier from Indigo Partners?

Indigo Partners also has a large order for new aircraft pending. Suppose they sell Frontier to Spirit, then the aircraft that were supposed to go to Frontier will go to their other airlines. But if they acquire Spirit, what will happen to the already agreed number of aircraft that each airline is supposed to get?
 
deltadudejg
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 9:35 am

DarthLobster wrote:
Bobloblaw wrote:
what is the benefit of these airlines merging?


Less competition and more A.Net chatter.

On that note, I predict at least one if not both will be part of B6 in 10 years.


Clean up the negative air one of those two airlines, shouldn't be hard to figure which of the two.

Plus if you watch the pattern of their new routes. One will announce service out of a city and the other will soon follow.
Aviation Enthusiast working in Airport Operations
 
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flymco753
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 4:12 pm

santi319 wrote:
DarthLobster wrote:
Bobloblaw wrote:
what is the benefit of these airlines merging?


Less competition and more A.Net chatter.

On that note, I predict at least one if not both will be part of B6 in 10 years.


Out of all of them people forget NK has ZERO debt and $1Billion in the bank and counting.

If anything NK is the one that calls the shots on a potential future merger...
True, and NK wants to keep their HQ in Florida, so I think it’s most likely that either A. It’ll stay in Miramar or B. It’ll move to Orlando (because of the heavy AirTran influence).
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MIflyer12
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 6:19 pm

Bobloblaw wrote:
what is the benefit of these airlines merging?


Private equity firms - Indigo Partners owns Frontier - are always looking for an exit strategy. They want to cash out and spin the funds into new investments. I don't know if that goal is two years away, or five, or eight.
 
CATIIIevery5yrs
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 6:51 pm

People have been calling this merger for years and no action yet. What’s different now? The F9 pilots would probably appreciate the CBA upgrade.
 
qcpilotxf
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 7:07 pm

I personally think that the opportunity for an F9 NK merger has came and gone. A few years ago when F9 was transitioning to ULCC they greatly complimented each other and were very much exploding in size at the time. I feel that they have both matured in their respective markets enough to be stable on their own and compete against not only the US4 but each other. Private firms are always looking for an exit stratigy by Indigo Partners has 4 airlines now that are starting to synchronize and play off each other which makes me think they plan on holding F9 close.

Private
 
MO11
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 7:28 pm

MIflyer12 wrote:
Bobloblaw wrote:
what is the benefit of these airlines merging?


Private equity firms - Indigo Partners owns Frontier - are always looking for an exit strategy. They want to cash out and spin the funds into new investments. I don't know if that goal is two years away, or five, or eight.



Exactly, which is why it sold Spirit at a beneficial time.
 
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spinkid
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Re: Spirit and Frontier: is a merger inevitable?

Tue Mar 06, 2018 10:40 pm

CATIIIevery5yrs wrote:
People have been calling this merger for years and no action yet. What’s different now? The F9 pilots would probably appreciate the CBA upgrade.



You really hit the nail on the head here. I would say that a merger of some sort for these three airlines is somewhat inevitable in the long run, but not until one ore more of them falter economically. Economies are cyclical and when the next recession comes I imagine a move will be forced. Right now, there really is no reason for any of these airlines to merge. They all seem to be making money.

Now that Sun Country is moving toward an ULCC product I would put them higher on the list of mergers and takeovers by any of those 3.
 
axiom
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Re: Spirit and Frontier: is a merger inevitable?

Wed Mar 07, 2018 12:05 am

In what universe do people think that G4 and F9 have compatible business models? Do people actually understand what G4's business model is? Barring some sort of existential change in the kind of package holidays they sell (I don't see a big market for Buffalo weekend getaways...), this makes exceptionally little sense.

I am also deeply confused as to how someone could say F9's fleet is more similar to G4's than it is to NK. #AlternativeFacts strike again.

F9 and NK are peas in a pod. They are each other's greatest competitors. And that makes them most likely to wed, I'd say.
 
santi319
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Re: Spirit and Frontier: is a merger inevitable?

Wed Mar 07, 2018 12:42 am

axiom wrote:

F9 and NK are peas in a pod. They are each other's greatest competitors. And that makes them most likely to wed, I'd say.


Nah, they coexist perfectly fine... the "people that otherwise will take greyhound fly NK/F9" myth is purely an a-net one. Truth is, it is the future of aviation here in the US and both of these carriers are taking the lead. The younger crowd (Millenials,etc) dont really care for first class upgrades and butt kissing, they want reasonable fares and to save Mother Earth, they will be taking over the country in the next decade, which will leave ironically the retirees to also fly these carriers since living longer lifes means spending less $$ on travelling...

If anything NK and F9 are a threat to the likes of WN and specially B6, the big three have recognized this already so they are becomming more and more like an ULCC in economy..

Interesting times ahead indeed
 
dc10lover
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Re: Spirit and Frontier: is a merger inevitable?

Wed Mar 07, 2018 1:05 am

Surprised they are still both in business.
Why endure the nightmare and congestion of LAX when BUR, LGB, ONT & SNA is so much easier to fly in and out of. Same with OAK & SJC when it comes to SFO.
 
dc10lover
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Re: Spirit and Frontier: is a merger inevitable?

Wed Mar 07, 2018 1:12 am

DarthLobster wrote:
Bobloblaw wrote:
what is the benefit of these airlines merging?


Less competition and more A.Net chatter.

On that note, I predict at least one if not both will be part of B6 in 10 years.

I am REALLY hoping Frontier Airlines merges with JetBlue Airways. Can we say "Denver".
Why endure the nightmare and congestion of LAX when BUR, LGB, ONT & SNA is so much easier to fly in and out of. Same with OAK & SJC when it comes to SFO.
 
PDX88
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Re: Spirit and Frontier: is a merger inevitable?

Wed Mar 07, 2018 2:02 am

dc10lover wrote:
Surprised they are still both in business.


No you're not, you just don't want them to be. Big difference.

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