New Orleans Louis Armstrong International Airport

Frontier Airlines has numerous fits and starts in its network as it remains on the selling block

US ultra low-cost carrier Frontier Airlines has made sweeping changes to its network during the last few weeks as it attempts to find the right mix of profitable routes that act as shields from one of its largest competitors, Southwest Airlines.

The changes include axing a short-lived focus city in Colorado Springs, hopping between airports close in geographical distance and introducing new seasonal flights from its Denver hub. Despite the end to the brief test case of the Colorado Springs focus city, Frontier for now remains committed to building up point-to-point service from Trenton, New Jersey and Orlando, Florida.

While the argument could be made that Frontier’s swift reaction to ever-changing market conditions reflects the nimbleness that its smaller size allows, the constant upheaval could be a turn-off to customers that expect a certain level of network consistency. And as Frontier’s parent Republic Airways Holdings works to secure a sale of Frontier in early 2013, would-be buyers may be scratching their heads over the long-term value Frontier might provide.

Southwest continues to show conservative approach to growth with deferral of 737s

Southwest’s move to defer deliveries of 30 Boeing 737-800s scheduled for 2013/14 to 2017/18 is a concerted effort to continue a disciplined approach to capacity management and a way to accelerate the company’s often-touted goal of achieving a 15% return on invested capital that it enjoyed in the 1990s. The move illustrates Southwest’s classic conservative approach in running its business as it believes an uneasy economic recovery and volatile fuel prices are creating uncertainty in how the airline business will evolve during the next couple of years.

The carrier first committed to the 737-800 in Dec-2010, opting to substitute 20 of the larger 175-seat aircraft for 137-seat 737-700s it had on order. Southwest expanded its Next Generation 737 order a year later and now has 73 737-800s on firm order with Boeing, plus an additional five leased from a third party scheduled for delivery later in 2012.