CEO of Spirit Airlines Abruptly Replaced

Cptnchia said:
Just cause it's not used doesn't mean they still don't own the marketing rights to the name. Northwest isn't use anymore, but that name is still owned by Delta.
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Cherokee_Cruiser said:
It's owned by Virgin Australia, but whatever the Virgin brand (or Branson) wants, the rest would follow.

IMO for the time being I don't see a VX merger. But down the road I think it's inevitable.
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I suppose they could lease the rights to the Virgin Blue name from Virgin Australia. But would Virgin Australia's rights to the name apply in the U.S. as well? After all, there are completely separate airlines called SkyWest in both the USA and Australia.
 
Cptnchia said:
VS, VX , whatever you call yourselves. Still doesn't mean he has any input to the board.
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In an interview he was asked where VX would go next and he laughed and said well the last time I gave an idea it was Toronto and it didn't work out, so I'll leave it to them to figure out what's best. Right around the time of the Denver announcement.

VS - Atlantic, VX - America, VA - Australia. I believe those are the official codes.
 
Say what you want about Ben Baldanza, but he was the first to make what I call the "plus postage and handling" business model work for the airlines in the US. This guy came up with a fee for just about everything when no one else was doing it.

Today, the "plus postage and handling" business model is what almost every airline uses.

This business model is what took all of the airlines from being in the red to being in the black. You basically sell the passenger a cheap ticket and then attempt to get another $150 out of that passenger in fees. It works. It's here to stay and the airlines have made billions of dollars because of these fees.

So even though Ben was a complete jerk much of the time, the business model he came up with is the reason that almost every domestic airline is incredibly profitable today.

I used to think it was ironic that this guy used to work at USAir and was responsible for the fortress hub fares at that airline.

He left high fare (at the time) USAir to go to Spirit and promoted low fares.

Somehow I never thought is was in his DNA, but he sure made it work for 10 years.

Don't be surprised if this guy doesn't end up where you least expect it.
 
JOEFRIDAY2 said:
Say what you want about Ben Baldanza, but he was the first to make what I call the "plus postage and handling" business model work for the airlines in the US. This guy came up with a fee for just about everything when no one else was doing it.

Today, the "plus postage and handling" business model is what almost every airline uses.

This business model is what took all of the airlines from being in the red to being in the black. You basically sell the passenger a cheap ticket and then attempt to get another $150 out of that passenger in fees. It works. It's here to stay and the airlines have made billions of dollars because of these fees.

So even though Ben was a complete jerk much of the time, the business model he came up with is the reason that almost every domestic airline is incredibly profitable today.

I used to think it was ironic that this guy used to work at USAir and was responsible for the fortress hub fares at that airline.

He left high fare (at the time) USAir to go to Spirit and promoted low fares.

Somehow I never thought is was in his DNA, but he sure made it work for 10 years.

Don't be surprised if this guy doesn't end up where you least expect it.
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The reason it works is because the gobermint taxes heavily on the ticket price itself. Unbundle the costs of stuff like baggage and seats, and that's pretty much pure profit for the airline. To be honest, I wouldn't be surprised to see uncle Sam eventually get their hand in these fees too.
 
@Cherokee_Cruiser
I'm not going to play a mines better than yours game, but I'm not sure you're understanding the difference in product between Spirit and VX et al.

We fly the same birds, but fly them differently. Same goes for everything else about the operation.

Spirit is growing too fast and is having issues, because of the "cheap ass" mentality.
 
That goes almost without saying. It sounds like they are experiencing something similar to what we had in 2009-2011. Unfortunately it did end up in deferring airplanes in 2012 in order to slow down the massive growth. We're now back in a growth mode but at a much more tempered pace than before.
 
Cherokee_Cruiser said:
That goes almost without saying. It sounds like they are experiencing something similar to what we had in 2009-2011. Unfortunately it did end up in deferring airplanes in 2012 in order to slow down the massive growth. We're now back in a growth mode but at a much more tempered pace than before.
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Same story at JetBlue in the mid-2000's (2005-2008ish).

The key differentiatior here is profitability. VX and B6 were forced to stop the growth because it was massively unprofitable - sucking up most (if not all) of their cash - at a time when they were already running mostly on borrowed money and when the credit markets were going the wrong way (limited supply of debt capital). Spirit's growth, on the other hand, has been hugely profitable and they continue to expand margins. The market has penalized them this year for (what I think has been) poor expectation management -- initially guiding to maintain relatively strong revenues AND keep the massive windfall from fuel. Instead they've found that the fuel windfall has encouraged legacies to compete aggressively on pricing (i.e. AAL), forcing them to eat some of the profits they thought they would generate (but they are still growing profitability).

I'll be curious to see what they do - but I don't think it will be the same extreme as VX/B6. Possibly defer a few aircraft, but I don't think they'll flat out stop deliveries (or come close) -- my hunch is they will start looking to expand in less competitive markets (re: not DFW/ORD/LAX etc.), and instead expand in cities that have less of a legacy presence. We'll see though - I could be way off - only time will tell.
 
I think that Mr. Baldanza picked a fight with American that he got the short end of the stick on.

Parker is a competitive dude that knows know to market against the low fare carriers when they start getting to close.
 
Thinking I might be outta luck for a while, just counted there are almost 200 in front of me (with the people who bypassed) but I know of quite a few who are going to take the upgrade now because of the "changing of the guard." 200 at an average of 10 a month is still almost two more years, I'm betting we are the "Spirit of Frontier" by then.
 
Eagle421flyer said:
Thinking I might be outta luck for a while, just counted there are almost 200 in front of me (with the people who bypassed) but I know of quite a few who are going to take the upgrade now because of the "changing of the guard." 200 at an average of 10 a month is still almost two more years, I'm betting we are the "Spirit of Frontier" by then.
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"Frontier Spirit" has a little better ring and a nice, American pioneering undertone to it.
 
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