US airlines shift to ultra-low budget model

Frontier Airlines.
Frontier Airlines. 

With the addition of new passenger fees, Denver-based Frontier Airlines took another step Monday in its shift toward refocusing itself as an ultra-low cost carrier.

Starting Monday, Frontier began to charge passengers from $US20 to $US50 ($A21.60 - $A54) to carry on a bag and $US3 to $US15 ($A3.24 - $A16.22) to preselect a seat.

In the past, Frontier waived both fees for economy fliers who booked through Flyfrontier.com.

Now, all economy fliers pay the fee.

For more than a year, Frontier has been moving toward the business honed by Spirit Airlines and Allegiant Airlines, both of which charge for carry-on bags and dozens of other services.

The shift gained pace last year when Indigo Partners bought Frontier from Republic Airways Holdings Inc for $US36 million ($A38.9 million) in cash.

Indigo also agreed to accept $US109 million ($A118 million) in debt.

Indigo helped finance Spirit Airlines, making it the airline with the highest profit margin in the nation last year.

Last week, Frontier announced the appointment of a new president, Barry L Biffle, who previously worked as executive vice president at Spirit and as chief executive at VivaColombia, the first ultra-low-cost carrier in South America.

He will take his post in July.

A list of the nearly 30 fee categories at Frontier — including a $5 ($A5.40) fee to print out a paper receipt and $10 ($A10.82) to make a reservation over the phone — can be found on their website.

By charging fees for services previously included in the full price of economy tickets, Frontier said it has cut its lowest fares by an average of 12%.

"With an unbundled product, customers can save even more by choosing to pay for only the products that they want, allowing them to customize their flight experience for each and every flight," said Frontier Chief Executive David Siegel.

 

MCT

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