spooldup

The point of a ULCC is to keep fares low for the Customer.

Yes, fares will increase with JB/NK because JB was buying NK to turn themselves into a suedo legacy that is attempting to gain the hearts of the people who already are focused on the big 3(4).

Frontier buying Spirit when they are on the verge of bankruptcy is keeping fares low. Say Spirit goes under. What happens to the fares they cared so much about then? Frontier could just jack them up. (no one would fly us obviously..) If JB aquired NK, Frontier could once again jack up prices (Once again, no one would fly us.)

IF Frontier buys Spirit, two ULCCs with the same business model, a good bit of overlapping routes. This leads to Maybe slightly higher prices, but overall more routes, frequency, etc for the customer.

F9 Merging with NK would be a very good move for the general public because even with both of us combined, increasing ticket prices by even $10 to compensate for both of us not undercutting each other and trying to compete with legacies and their bare bones tickets would still lead more people to fly us, have less issues with 1/2 flights a day, cancellations, etc.

But what am I kidding, management said they can't afford to pay us market airbus rates, so I am assuming they can't afford to buy an airline either and this is just some weird theory everyone is talking about again.

Maybe Frontier will buy NK and JB? Big ULCC = more cheap seats for those the judge cared so much about.

skitheline

What's going to happen when Frontier doesn't have any direct competition on low-fare tickets? Do you know how supply and demand work?

Goingolfing

lol. You are just trying to argue without actually thinking. Do you honestly think people will fly F9 with higher fares?? There's a law of diminishing returns that goes along with supply and demand. As mentioned above by someone else, the fares "may" increase slightly but they can only go up so much before you will run out of demand. The prices will still need to be considerably less than the competition on their routes or nobody would fly. At a certain price point customers would just fly on the competition with more comfortable seats and less issues.

BagMan

Your going to say that when we just pulled 72 pilots out of Vegas Because "there were to many seats going to Vegas" more like "Frontier is not competitive with other airlines "

planejoe

B6 will most likely be appealing because if they don't they owe Spirit shareholders 470 million dollars. No way B6 shareholders just walk away from half a billion bucks. So it'll be a long road ahead either way.

TurboFanMan

So if the merger is considered illegal, they are required to pay? Also, what happens about the monies JetBlue as already paid the Spirt share holders? I have received 2 payments from JetBlue already.

planejoe

The agreement to pay the "break up" fee included antitrust issues, so yes they will still have to pay it. Don't know about the payments already made.

DrJekyll MrHyde

https://finance.yahoo.com/video/jetb...tentType=VIDEO

Apparently most of those payments (400mil) have already been made to shareholders, but the remaining 70mil that goes directly to Spirit is still due. The $470mil is addressed by this analyst at the end of the video.



Side note: I don’t agree with her conclusion that “other airlines won’t step up” with a merger offer, I still believe Indigo/Frontier likes its chances. Interesting though, that she thinks Spirit could go to liquidation. That’s a bold forecast.

bidnez

I think F9 is just as likely to buy NK as it is to buy B6... Buying B6 isn't going to hurt the ULCC market, which is what the judge wanted to protect

Powderkeg

Possibly...looking today at JB + NK market cap Indigo could buy both for less than the original NK deal. Call the whole thing JetBlue but convert it to the ULCC model with some class. Open 40 bases. Ryanair efficiency overnight. Keep JB's new CEO that has a customer service focus. Stranger things have happened...