Frontier CEO Barry Biffle Wants Changes. Now.
Business is neither good nor trending in the right direction. Also, Southwest's CEO explains why August is no longer a great revenue month.
Have you noticed something amiss at Frontier Airlines? Its ultra-low-cost model, which has worked nearly everywhere else in the world, probably should be a winner in the United States. But Frontier cannot break out of its rut, with the airline resorting to deep discounts to fill airplanes — including a recent 99 percent off base fare sale — even as many low-cost and legacy competitors say demand is fine.
I’ve been struck at how CEO Barry Biffle has reacted. While I generally laud leaders who take action and don’t just wait (and hope) for good times to return, Biffle seems to want to chase the idea of the day. I like his urgency, but to me there’s a fine line between urgency and panic.
Last week, I briefly wrote about Frontier’s issues in a broad piece about Morgan Stanley's investment conference in Laguna Beach, California. Today, I want to return to Biffle's session for a more thorough discussion. Biffle admitted something is wrong with Frontier's performance, promising investors he would hatch a plan to fix it. The night before the event, Biffle said, he held a nearly two-hour meeting with airline leaders to brainstorm ideas. He said he planned more meetings for his return and warned his team that the next few weeks will be busy.
Usually, publicly traded companies wait to flesh out ideas before CEOs share them at investor conferences. But Biffle didn’t want to wait. He shared some early plans with Morgan Stanley’s Ravi Shanker, even as he admitted it will take a while to implement them and to estimate how they will influence profit margins.
"There's nothing like a change in the demand environment to focus the mind," Biffle said. "We're going to be pretty darn busy the next couple of weeks. I'd like to be able to update at some point this fall. But yes, you're going to see changes come out of Frontier."
Read on to learn Biffle’s plan to save the airline, including his somewhat bizarre rant about employees who work from home. Also continue reading for some commentary from Southwest CEO Bob Jordan, including a discussion about why August is no longer one of the carrier’s best revenue months.
First, to Frontier.