Pilot Vote Will Decide Frontier's Future
STEVE INSKEEP and RENEE MONTAGNE, host:
The future of Frontier Airlines may rest on a vote today by its pilots. The pilots are being asked to reduce their pay and benefits to help keep the Denver-based carrier in business. In exchange, they would get a share in the airline.
NPR's Jeff Brady explains.
JEFF BRADY: High fuel prices contributed to a $55 million loss for Frontier during the first quarter this year. In 2009, Indianapolis-based Republic Airways bought Frontier out of bankruptcy and tried to expand it. But last week, CEO Brian Bedford sent a letter to employees saying without $120 million in financial improvements, Frontier will not be a viable business.
Airline analyst Mike Boyd says Republic's strategy for Frontier is partly to blame.
Mr. MIKE BOYD (Boyd Group International): They have an operation in Denver and they have an operation in Milwaukee, and they're trying to fly flights out of Kansas City and out of Omaha, and I think it's kind of frittered away their strength.
BRADY: Boyd says Frontier's strength is its association with Denver and the brand loyalty the airline has with flyers here. Boyd says Frontier is still a well-run airline; it just needs to return to its Mile High roots.
Mr. BOYD: So with a little more capital, there's no question they can survive.
BRADY: If pilots approve concessions, then Republic says it will raise more cash. The deal would give Republic a minority stake in Frontier within three-and-a-half years. The pilots union is expected to release voting results later today.
Jeff Brady, NPR News, Denver.
NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.