Frontier Airlines, facing tougher competition at its Denver hub, is looking for new sources of revenue: more flights to Mexico and Canada, new routes to mountain airports and even selling extras to passengers.
Paul Tate, the Denver-based airline’s chief financial officer, said Thursday the company plans to begin selling travel insurance early next year.
“There’s definitely some low-hanging fruit and some options that we haven’t entertained,” Tate said.
Price details on the insurance were not disclosed.
The airline already sells “confirmed standby” status for $25 and charges $5 extra for bookings over the phone or in person at the airport.
In wide-ranging remarks at an analyst conference in New York, Tate also said the competitive situation in Denver is not as dire as some think. United is not adding the same flight capacity it has in the past, according to Tate.
“Ted was the savior of United, and now you don’t hear anything about it,” Tate said, referring to United’s discount operation.
Ted “continues to perform well,” said United spokeswoman Robin Urbanski. “Right now Ted already flies to all the leisure destinations that we serve out of Denver.”
A new entrant to Denver, Southwest, poses another competitive threat. Southwest covers about 25 percent of Frontier’s markets, Tate said.
“One of our strategies is to diversify from the domestic war, so to speak,” Tate said.
Canada, Mexico and even Central America could offer more opportunities, according to Tate.
Separately, the new Q400 turbo-prop planes Frontier has ordered for delivery next year are “perfect for the mountains, like Telluride, Aspen, Vail. We don’t serve those markets right now,” Tate said.
Southwest is “not going to be flying to Vail or Aspen, probably ever. They’re not going to fly to Canada or Mexico and they’re not going to fly to regional jet markets,” Tate said.
He said using the Q400 fleet to provide services to other airlines is a possibility.
Frontier also plans to announce its new regional jet carrier to replace Horizon Air in 30 to 45 days, and add more regional jets to its fleet for a total of 17. The full fleet will take about 18 months to get into operation.
Staff writer Kelly Yamanouchi can be reached at 303-954-1488 or kyamanouchi@denverpost.com.
