Spirit Airlines, the ultra-cheap carrier known for charging
passengers to carry a bag on a flight, is fast looking more like the
nation's true low-cost airline.
Spirit, which only a few years ago
flew largely to destinations along the East Coast, is rapidly adding
planes to its fleet and expanding its routes to more cities that are
dominated by the country's biggest airlines.
And it's asking for
fares, such as $38.79 one-way from Minneapolis-St. Paul to Chicago
O'Hare, that at times are about half the price charged by bigger carrers
such as American.
"Whenever we add a new market or a new
service, we always try to price that market at lower than the prevailing
fares in that market to bring back some people who've been priced out,"
says Ben Baldanza, Spirit's President and CEO.
Baldanza says, "is to make sure the customer who can't afford to pay
current airline prices has an option to still travel."
never have the flight network and frequency to make it the go-to airline
for frequent business travelers. Nor is its bare-bones way of flying -
in which all you get for your ticket price is a flight because
everything else costs an extra fee - for everyone.
But with its
ultra-low fares, Spirit increasingly sticks out against bigger,
traditional low-cost carriers, such as Southwest and JetBlue, which
increasingly charge prices comparable to what passengers pay to fly the
traditional network airlines such as United, Delta, American and US
Spirit's growth arrives as fares to fly many of the big
carriers have risen seven times since January, roughly 4.5% over last
year. And low-fare giant Southwest, which has merged with another
low-cost carrier, AirTran, has led the way on five of those increases.
realized that in really large markets ... fares are higher than they've
ever been," Kevin Schorr, vice-president of airline and airport
consulting firm Campbell-Hill Aviation Group, says of Spirit.
he says, "even though they charge all those (extra) fees, there's no
question if you're the kind of passenger that just wants a flight from A
to B, can put your belongings under the seat in front of you, and sit
anywhere on the plane, you will no doubt get the cheapest ticket on
200 flights a day
Florida-based Spirit has
announced or begun service this year on more than three dozen new
routes, offering its rock-bottom fares on flights between Denver and
Phoenix, where a one-way ticket late this month will cost $38.79, or
Houston and Las Vegas, among other destinations.
By the end of
this year, Spirit will have a fleet of 44 jets flying on average more
than 200 flights a day to more than 50 destinations. And Baldanza says
the airline plans to add roughly seven more planes a year through the
end of 2015, increasing its number of seats or flights by at least 15%
While bigger carriers, such as United and Delta, compete
for fliers with their cabin perks, loyalty clubs and vast international
service, Baldanza says Spirit's main selling point remains the fares it
brings to a market. And though Spirit is planting a bigger flag on the
turf of the larger airlines, Baldanza says it's not trying to directly
"We're not trying to take share from any other
airline or convince a customer you're better off flying us than JetBlue
or Delta," he says. "We're just saying we want to offer a lower-priced
product to people who want to pay less."
Baldanza likened Spirit
to McDonald's or Wal-Mart. "Neither of their goals is to dominate the
restaurant or retail worlds," he says, "but to serve their niche really
Southwest has long been the nation's low-fare kingpin, which has forced down competitors' prices just by entering a market.
Southwest no longer can be counted on to always have the cheapest
flights. And Southwest, which carries more passengers domestically than
any other U.S. airline, is looking more like a traditional carrier with
its large route network and entrance into international service.
Some analysts say Spirit, along with Allegiant Air and Frontier, now has a truer claim to the industry's low-cost mantle.
the end of the day, our goal is to be the low-fare leader in the market
we serve," says Spirit spokeswoman Misty Pinson, adding that the
airline aims to have a total fare that is at least 25% lower than the
currently available average ticket price.
Airline and travel
industry analyst Henry Harteveldt says that because Spirit tends "to
operate just one flight a day on most routes, they're never going to
challenge the major airlines for the corporate business traveler."
Harteveldt says, "There's always somebody out there who would like to
pay less for an airline ticket than they're paying now. Airlines like
Spirit and Allegiant and Frontier, I think, could pose a credible
challenge, not only to larger network airlines but to even some of the
low-cost carriers like Southwest and JetBlue."
As recently as May
2011, Spirit flew to just three destinations from Dallas/Fort Worth
International Airport, a hub for American Airlines. Now, Spirit provides
service to 17 cities from Dallas. It will add nine more destinations by
"It's a very different segment of the market that
they target," says Luis Perez, Dallas/Fort Worth airport's vice
president for air service development. Spirit is "a la carte," he says.
"They have services you use as you need them. And, basically, that opens
up a whole new possibility for people who normally would not travel if
Spirit wasn't around."
Spirit's niche has proved profitable. For
the second quarter of this year, its net income, excluding special
items, increased 35.4%, to $35.3 million, compared with the same period
last year, Pinson says.
Roughly 40% of the airline's revenue is currently coming from its myriad fees, Baldanza says.
Spirit, not even a glass of water is free. The airline was a pioneer
among U.S. carriers on fees, becoming the first to charge passengers to
check a bag. And it sparked the ire of Congress when it began last year
to charge for carry-on bags that need to be stowed overhead. That fee
will shoot up to $100 starting Nov. 6 if a flier waits until the
boarding gate to pay it.
A roomier "Big Front" seat, bought in
advance, can range from $12 to $199. And in February, Spirit began
tacking a $2 "unintended consequences fee" onto its one-way fares in
response to a new Transportation Department rule that allows travelers
to change their minds within 24 hours of booking a flight without
penalty - a rule Baldanza says can ultimately lead to empty seats on
flights and higher costs for all passengers.
Baldanza defends this
à la carte strategy as a democratic way to help keep fares low. He says
it "allows customers to not have to subsidize anyone else - to say I'm
going to pay for what I use but not carrying the burden of other
Spirit says even the fee for carry-on bags has
been successful. It has sped boarding and deplaning, it says, and has
allowed the airline to save almost 6 million gallons of fuel in the last
year because of the lighter load.
Other airlines have taken
notice. Most carriers now charge passengers to check a bag. And in
April, Allegiant Air began to charge for carry-on bags that need to go
in overhead bins.
Cheap tickets with no frills are also popping up
at other airlines. In March, Delta introduced "basic economy" on a
handful of routes where it competes with Spirit. Passengers flying
non-stop between Detroit and four cities in Florida, including Orlando
and Fort Lauderdale, can grab an ultra-low fare but can't reserve their
seat prior to checking in at the airport. And with a few exceptions, the
fare is non-refundable.
More seats, less room
But flying Spirit has its critics.
Zipursky, managing director of an investment banking firm who lives in
Omaha, says that he flew Spirit a couple of years ago when he had to
travel to Santo Domingo on business.
He says it "was reminiscent of riding Greyhound back in the day."
experience was less than pleasant," Zipursky said. "I had only my
single bag, so the extra fees were minimal, but I would avoid flying
Spirit at all costs."
Jami Counter, senior director of SeatGuru,
which informs travelers about airline cabin features, says Spirit is "as
bare-bones as bare-bones can be, basically stripping everything form
the flight experience ... charging for anything they view as an add-on.
And part of that is cramming as many seats in the plane as possible."
acknowledges packing passengers in, putting 178 seats on its A320s.
Those jets usually have 150 seats. Spirit's A320s also feature
"pre-reclined" seats that can't be adjusted. And there's a 28-inch
pitch, or the distance from the back of a seat to the front of another.
Most U.S. airlines offer at least 3 more inches.
"That's a difference between having your knee crammed in the seat back or 3 inches for your knee to breathe," Counter says.
flight experience is probably the worst in the U.S.," Counter says. In
his site's ongoing airline survey, only 21% of those who'd flown Spirit
say they'd recommend it to others. That's the lowest rating of any U.S.
carrier, he says.
Ads all over
Spirit also pushes the envelope when it comes to advertising.
has ads throughout its jets, from the tray tables to the uniforms of
its flight attendants. Its promotions have ranged from tacky to topical.
Most recently, it made light of American Airlines' woes when the
carrier had to ground more than 40 Boeing 757s because some seats had
become loose in flight. Spirit offered a 7.57% fare discount in a
promotion that declared "we let low fares loose, not seats."
its edgy ads and lack of customer service, it's unabashed about what
type of service it offers: an inexpensive, no-frills ride from one place
to the next.
"What I respect about Spirit is that they don't try
to be something they're not," analyst Harteveldt says. "They don't
promise you a flight attendant who'll fuss over you. They don't tell you
the gate you'll be in will be a high-end lounge."
And at a time
when a trip on most airlines means flying on a packed plane, where only a
soft drink is free, some travelers feel Spirit isn't so unique.
main complaint is that they charge for carry-on bags," says Al Katz, a
comedian who lives in Kissimmee, Fla. "Other than that, they compare
with all other airlines."