Though its new competitor may have an advantage selling flights to customers in Las Vegas, Phoenix and Chicago, Frontier Airlines says it has the advantage in selling flights to customers in Denver.
But Frontier’s financial performance on some routes has already been hurt by Southwest Airlines, chief executive Jeff Potter said at a JPMorgan airline conference in New York on Thursday.
Potter said Frontier’s unit revenue, or revenue per available seat mile, fell 12 percent to 12.5 percent in January in the three markets Southwest began flying in January – Denver to Las Vegas, Phoenix and Chicago Midway.
“It’s better than we expected,” Potter said, adding that he anticipates improvement in February and March.
Frontier increased capacity in those three markets by 22 percent, in part as a response to Southwest.
Potter said United’s recently announced capacity increase in Denver is a bump of about 4.6 percent in markets where it competes with Frontier.
Southwest is the largest airline in the country based on domestic passenger traffic, and has a fleet of 447 planes. Frontier is a Denver-centered airline with a fleet of 49 planes.
“Providing that service from Denver to the strongest cities in our route system made perfect sense for us,” said Southwest spokeswoman Edna Ruano.
Separately, Potter said Frontier will focus on increasing bookings through its website, a move that can cut costs. Thirty-five percent of its seats are booked through Frontier’s website.
He also said Frontier has had discussions “off and on” about forming partnerships, such as code-share marketing or frequent-flier alliances.
Staff writer Kelly Yamanouchi can be reached at 303-820-1488 or kyamanouchi@denverpost.com.
