The Skift Airline Innovation Report is our weekly newsletter on the business of airline innovation. We look closely at the technological, financial, and design trends at airlines and airports.
Brian Sumers writes and curates the newsletter, and we send it on Wednesdays. You can find previous issues of the newsletter here.
When Frontier Airlines switched to an ultra-low-cost model roughly four years ago, it began using the tagline “Low Fares Done Right,” a not-so-gentle jab at what was then its biggest competitor, Spirit Airlines.
The line was appropriate, as Frontier was probably more customer-friendly than Spirit, then run by CEO Ben Baldanza, who insisted on charging passengers for everything, including water. Frontier, determined to not be so antagonistic, offered it free.
But Frontier, with only one genuine competitor, was not customer-friendly. It ran a shoddy operation, and customers often complained about delays, cancellations, and lost bags.
Frontier’s still not perfect, but we’re beginning to see a more refined airline. This summer, it overhauled its elite frequent flyer program, adding perks for loyal travelers, while making it easier for many customers to pool points. Last week, Frontier reduced fees for customers who change plans at least two weeks in advance.
We can probably thank the Big Three — United Airlines, Delta Air Lines, and American Airlines — for forcing the pivot. With their newish, no-frills basic economy fares, all three are more formidable competitors to discount airlines. Frontier may have been losing share to legacy airlines, and its executives probably realized they needed to change strategy to keep up.
What do you think of Frontier’s changes? Let me know via email or Twitter.
Stories of the Week
Discount Airlines Take Frequent Flyer Programs More Seriously After Initial Snub: Frontier isn’t the only discount airline taking loyalty more seriously. As I mention here, both Spirit Airlines and EasyJet plan to overhaul their schemes soon. They say it’s good business to reward customers. “By driving loyalty, first of all you’re getting the first look,” Spirit President Ted Christie told me. “The customer is coming to see you first to buy their ticket. That’s a tremendous value to any product. Secondarily, over time, loyalty breeds the interest in being willing to pay you more for the same product.”
Skift Global Forum Preview: How American Airlines Is Reacting to Higher Fuel Prices: American Airlines President Robert Isom is speaking Thursday at Skift Global Forum in New York. He and I will chat on stage, but I interviewed him last week by phone to learn about what he’ll say. Spoiler: Isom is bullish on American despite higher fuel prices.
Frontier Lowers Its Change Fees as Competition Heats Up: Frontier altered its change fee structure last week, and is letting customers pick new flights without paying extra as long as they alert the airline at least 90 days prior to departure. Customers who tell Frontier at least 14 days in advance now only pay $49 to make a change, down from $99. Why is that significant? Basic economy fares sold by American, Delta, and United don’t allow changes, even for a fee, so this makes Frontier a more appealing option for many customers.
Turkish Airlines Plans for Growth With Business Travel at Core: Skift’s Andrew Sheivachman traveled to Istanbul recently, where he learned everything is going well for Turkish Airlines. At least that’s what airline executives told him. But Sheivachman notes no one wanted to talk in detail about geopolitical events or currency fluctuations. Executives were more focused on bragging about their 2023 plan: A 500-aircraft fleet and a 4 percent share in global aviation.
JetBlue Founder Sees His Startup as Tech Company That Happens to Fly Planes: David Neeleman, fired as JetBlue CEO in 2007, has had more than a decade to dream about his next foray into the U.S. airline industry. He expects to be back by 2020, with a new airline flying Airbus A220s in what are now unserved markets. “The mantra will be let’s try to get people there twice as fast with fares 30 to 50 percent lower than they’re paying today,” he told Bloomberg.
5 Ways an Emirates-Etihad Merger Would Transform the Airline Industry: Will Emirates and Etihad merge? They probably should, but it’s a tricky situation. Bloomberg’s Benjamin Katz looked at some of the issues involved, including politics, antitrust, and the future of Etihad’s hub in Abu Dhabi. Related: Emirates Looks to Become World’s Largest Airline With Potential Takeover of Etihad, by me.
Tired of Being Stuffed in an Airplane Seat? Congress Is Trying to Help: U.S. legislators are taking a lot of credit for doing relatively little. Congress is not regulating the size of an airplane seat. Instead, it is directing the FAA to examine the issue and come up with size minimums for safety. Here’s betting the FAA finds a 17-inch-wide seat with 28-inch pitch is perfectly safe. We’re not going back to the 1970s, and 34-inch pitch. Sorry.
Norwegian Air Is Reportedly on the Hunt for Its Next CEO: Bjorn Kjos is not a young man, so it makes sense he’s ready to call it quits. But the timing is interesting. Norwegian has been on a growth binge, and some analysts are skeptical the airline can make it as an independent entity. Bloomberg has the scoop.
Skift Senior Aviation Business Editor Brian Sumers [email@example.com] curates the Skift Airline Innovation Report. Skift emails the newsletter every Wednesday. Have a story idea? Or a juicy news tip? Want to share a memo? Send him an email or tweet him.