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Spirit's new CEO hints at nuanced changes rather than an overhaul. Operations are a key focus

13-Feb-2016

Top priorities for the new chief executive of Spirit Airlines are improving operations and customer service, areas where the company has lagged far behind its US airline peers during the last couple of years. As US competitive dynamics change, those two factors are becoming distinguishing factors for succeeding in an environment where falling fuel costs are, for the foreseeable future, keeping fares low.

Although Spirit has no plans to match the 30% expansion in capacity that it recorded in 2015, management still believes that a growth rate of 15% to 20% is reasonable. However, it appears that the airline seems poised to make some nuanced changes to its network strategy by focusing less on large markets and evaluating more mid-sized markets. Depending on the changes that occur, the composition of Spirit’s fleet could look different in five years, compared with today.

In the short term, Spirit has not observed further deterioration in the US pricing environment; however, it has not experienced marked improvement either. As a result its unit revenue revenue performance in 1Q2016 will likely mirror the 16% decline the airline posted in 4Q2015.

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Throwback to our 2013 Airlines in Transition conference in Dublin to our top table dinner hosted by CNN Anchor and Correspondent, Richard Quest.
DiscussionLeader:RichardQuest,Anchor,CNN
Top table participants:

Derek Sharp, Group Vice President And Managing Director, Global Distribution Sales And Services, Travelport

Kevin Toland, CEO, Dublin Airport Authority

Christoph Mueller, CEO, Aer Lingus

Montie Brewer, Former CEO, Air Canada

Catherine Lynn, Group Commercial Director, easyJet

Tewolde GebreMariam, CEO, Ethiopian Airlines

Matthew Baldwin, Director, Air Aviation and International Transport Affairs, European Commission

Jeffrey Shane, General Counsel, IATA

Willie Walsh, CEO, International Airlines Group

David Barger, CEO, JetBlue

Alex Cruz, CEO, Vueling

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