DENVER—Frontier Airlines Holdings Inc. announced Thursday it will expand service to eight cities across the Rockies as it works to improve the bottom line while coping with persistently high fuel costs and aggressive competition.
Frontier Airlines will start the flights in April and May using turboprop aircraft from its Lynx Aviation subsidiary and regional jets operated by Republic Air, both of which can be more efficient and economical on shorter trips.
The new destinations are Colorado Springs, Aspen, Grand Junction and Durango in Colorado; Missoula and Bozeman in Montana; Fargo, N.D., and Jackson, Wyo. The company expects to hire up to 20 employees for each station.
Frontier’s goal is to drive more traffic to its hub at Denver International Airport where it competes against United Airlines and Southwest Airlines.
Calyon Securities airline analyst Raymond Neidl said the move into smaller markets may benefit Frontier if there is enough traffic to sustain operations. “They’ve got to diversify as much as they can out of Denver,” he said. “They are being squeezed on one end by United and the other by Southwest.”
The announcement comes as Denver-based Frontier is completing an operational review under Chief Executive Officer Sean Menke, who came on board five months ago. Menke said he is satisfied with the route adjustments overall and will look at other ways to boost revenue as he strives for sustained profitability.
One area he wants to explore is a la carte pricing such as charging more for specific services similar to United’s decision to charge more for some checked bags and Southwest’s new business-class fare.
“Every airline is going to look at how they can get additional dollars,” he said.
The eight new cities are among 62 that offered bids for Lynx service which began in December after a two-month delay in certification. It already serves Wichita, Kan., Rapid City, S.D., and Sioux City, Iowa.
Menke said the cities offered incentive packages that included reduced landing fees and rent and marketing campaign assistance. However, he said his decisions were based largely on demographics and economic opportunity.
The company plans to announce other new destinations in early summer. Among the possibilities are Vail, Steamboat Springs and Crested Butte.
At a news conference, Menke was joined by Gov. Bill Ritter and representatives of Colorado Springs and Aspen who said the new service would be an economic benefit to the region.
Colorado Springs, which also will be home to a Frontier maintenance hangar, expects the new competition to help lower fares. Mayor Lionel Rivera said his next goal is to convince a carrier to add nonstop service from Colorado Springs to the East Coast.
Frontier’s shares closed up 1 cent to $3.16 a share in Thursday trading.
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