Low-cost carriers Frontier Group Holdings and Spirit Airlines Inc yesterday unveiled plans to create the fifth-largest US airline in a US$2.9 billion tie-up likely to tighten competition against traditional carriers.
Spirit's wage expense as a percentage of revenue shot up by more than 10 points last year versus 2019. Higher fees prompted Frontier to exit airports such as Los Angeles and San Jose in California, and stop serving Washington-Dulles and Newark. The merged company would be in an “excellent” position to combat rising operating costs, McNally said.
Biffle acknowledged the Frontier-Spirit deal would require DOJ approval but predicted it would be “well received” by regulators because it would lead to “low fares to more people in more places”.