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Frontier Airlines makes a network push starting in late 2015 as it flexes its new ULCC muscle

Analysis

With its transition to an ultra low cost airline essentially complete, Frontier Airlines continues to undergo network changes to maximise its ULCC business model. In the latest round of flights starting in late 2015 and continuing early into 2016, Frontier is stepping up competition with familiar foes, namely American Airlines and Southwest Airlines. American in particular has faced deep discounting in its markets during 2015 from Southwest and other ULCCs, which has been one main factor in the Fort Worth-based airline's sagging unit revenues.

Among the network changes for Frontier is the pruning of some service from Cincinnati, a market that seemed ripe for the airline's business model. But it appears Frontier is opting to focus much of its new network offerings in leisure markets with a push from Fort Myers, Florida and Las Vegas.

Frontier also recently marked a milestone with the delivery of its first larger gauge Airbus A321 featuring a high density configuration of 230 seats. As it continues to fine-tune its network and product offerings, Frontier finds itself in a US domestic environment where unit revenue and yields are falling, yet profits are reaching record highs.

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