Frontier Airlines said today it has reduced its indirect labor workforce by 10 percent, to save $5 million annually.
Indirect labor typically includes employees not directly involved in production, such as white-collar workers.
“Due to the extreme cost environment we are faced with, we have elected to make several decisions to position the airline for long term viability,” Frontier chief executive Sean Menke said in a written statement today.
Denver-based Frontier expects fuel prices for the current quarter to increase 17.7 percent year over year. Because of the increase in costs, it expects to lose 58 to 68 cents a share in the current December quarter, excluding special items. That’s a wider loss than it had previously forecast.
The company also plans to reduce its year-over-year flight capacity growth for the March quarter to 8.6 percent, from 13.7 percent.
“We are also evaluating our fleet size and future aircraft deliveries to ensure the fleet is ‘right-sized’ to endure this difficult cost environment,” Menke said in the statement.
The moves were announced as Frontier reported that its planes were 78.1 percent full in November, up from 72.8 percent a year earlier. The company had a 22.5 percent increase in traffic measured by revenue passenger miles, on a 14.1 percent increase in flight capacity measured by available seat miles.
Frontier’s passenger yield, a measure of airline financial performance, fell 3 percent in November.
Kelly Yamanouchi: 303-954-1488 or kyamanouchi@denverpost.com
