The combined airline would be one of the biggest in the United States, ranking as the 5th largest.
Is a Frontier-Spirit merger actually on the horizon?
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In February 2022, Frontier and Spirit announced plans for a $2.9 billion merger that would have created the 5th largest airline in the United States. But then JetBlue Airways stepped in that April with a hostile $3-plus billion proposal, which Spirit ultimately accepted. However, that deal collapsed this past March after a federal judge blocked it.
Mergers can have mixed results. They can reduce competition and lead to higher airfares. But they can also make the resulting airlines stronger and better able to expand to new destinations.
In this case, the benefits of combining Frontier and Spirit may outweigh the risks. Spirit is struggling – it's cutting routes because dozens of its planes are grounded due to engine issues. Plus, with a big debt bill coming up next year, there's a chance it could go bankrupt and shrink dramatically in size. And a smaller Spirit wouldn't be good for consumers.
"A national airline with very high usage and very low costs will take away the competition between two airlines chasing the same cost-conscious passengers," wrote Tom Fitzgerald, an airline analyst at the investment bank TD Cowen, in a report shared on Wednesday, October 23rd. "The combined company will likely be in a stronger position to compete in the Southeast and Caribbean."
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This stronger competitor would be good for consumers, lowering average airfares and giving them more options when they travel.
The combined Frontier-Spirit airline would be the 5th largest in the United States by number of seats, according to October schedule data from aviation analytics firm Cirium Diio. It would even be larger than Alaska Airlines after its recently approved merger with Hawaiian Airlines. The combined airline would serve 115 cities, including 24 international destinations in countries like Colombia, Costa Rica, and Mexico.
Frontier-Spirit would also be the largest airline at South Florida's second busiest airport, Fort Lauderdale-Hollywood (FLL), and the second largest airline in popular destinations like Dallas-Fort Worth, Las Vegas, and Orlando.
Based on a presentation on the benefits of their first merger proposal from 2022, Frontier-Spirit could be strengthened to enter new markets that neither airline serves today like Eugene, Ore., Ithaca, N.Y., and Worcester, Mass.
First, Frontier and Spirit must reach an agreement before anything can happen. According to The Wall Street Journal, this could be part of a potential Chapter 11 bankruptcy filing by Spirit. In the best-case scenario, consumers wouldn't see any benefits from a Frontier-Spirit merger until 2026 at the earliest.
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