MW This airline is the best bet to fill Spirit's void

By Claudia Assis

Frontier is ready to pounce on routes left behind by Spirit

Frontier and Spirit planes at Fort Lauderdale's airport. Frontier says it's ready to pounce on routes Spirit has left behind.

Wall Street seems to have crowned Frontier Airlines as the main beneficiary of Spirit Airlines' demise - judging by the stock's 20% move higher this week.

Markets also like that Frontier has enough liquidity to withstand the onslaught of rising jet-fuel prices.

"Frontier inherited the keys to the ultra-low-cost carrier kingdom" after Spirit Airlines ended operations on Saturday, Jamie Baker, an analyst with J.P. Morgan, said in a note Wednesday.

Frontier $(ULCC)$ and Spirit historically operated under very similar business models, targeting mostly price-sensitive leisure travelers and operating planes with dense seating configurations, said Ahmed Abdelghany, an associate dean and professor at Embry-Riddle Aeronautical University.

Other budget carriers such as Allegiant $(ALGT)$, which is planning to buy Sun Country Airlines (SNCY), are different, Abdelghany said. Allegiant focuses heavily on low-frequency leisure routes connecting smaller cities to vacation destinations like Florida cities and Las Vegas, he said.

"Its model is built around limited weekly frequencies and extremely disciplined capacity deployment, not large-scale competitive overlap in major metro markets," Abdelghany said. Allegiant may opportunistically enter some markets, but it is not designed to become a broad replacement for Spirit.

Sun Country is even more specialized, operating a hybrid strategy that combines leisure flying with a significant cargo operation for Amazon.com (AMZN), he said.

That said, Frontier is unlikely to replace Spirit one-for-one across the entire network, Abdelghany noted. The company is moving quickly to fill the gaps left by the defunct Spirit, raising some eyebrows in the current market climate.

"The industry today is much more cautious about rapid growth because of higher fuel costs, labor expenses, aircraft and engine supply constraints, and pressure from investors to improve profitability rather than simply grow market share," he added.

More broadly, that ultra-low-cost model in the U.S. is under significant pressure right now, Abdelghany said.

It's not disappearing, because there will always be a segment of travelers extremely sensitive to price, but the budget-airline economics have become much more difficult than they were a decade ago, he said. That's due to higher fuel prices, which disproportionately hurt ultra-low-cost carriers with limited room to absorb additional costs, labor costs and direct competition from major airlines, which have unveiled their own basic fares.

Read more: Spirit Airlines is no more, but discount plane tickets are here to stay

Fuel is second only to labor in terms of costs for airlines, and prices have climbed in the wake of the Iran war.

U.S. jet fuel prices averaged $4.29 a gallon in April, up more than 90% from the January average of $2.21 a gallon. Prices have moderated this month, and averaged $4.18 a gallon on Tuesday, according to Argus Media and an industry group.

As an added benefit, J.P. Morgan's Baker noted that Frontier has sufficient cash "to weather the storm" caused by jet-fuel prices, Baker said.

As Spirit grounded flights and ended service, several airlines offered lower-priced flights to help strained Spirit travelers, but mostly over the weekend and only in airports where they overlapped. Frontier went one step ahead, however, offering systemwide discount fares through next weekend, and executives said this week they are ready to pounce on the routes Spirit left behind.

Don't miss: Spirit Airlines is no more, but discount plane tickets are here to stay

Frontier reported quarterly results earlier this week, showing a wider loss on a year-over-year basis, but narrower than Wall Street's dialed-down expectations.

Frontier executives said on a call with analysts following the results that Frontier will expand service this summer with nine additional routes, plus 15 new daily departures across 18 former Spirit routes, including Orlando and Fort Lauderdale, Fla., as well as Las Vegas.

"We have more over-route overlap with Spirit than any other U.S. carrier, uniquely positioning us to recapture the demand they left behind," COO Robert Schroeter said on the call.

Raymond James analyst Savanthi Syth said she was concerned about those plans to add off-peak, weekday flights.

Other airlines, including majors such as United $(UAL)$, have cut such flights, which are generally emptier and thus less profitable, to stay ahead of fuel costs.

But with Spirit out of the picture, the capacity risk is mitigated, Syth said.

Back in 2022, Frontier made a move to buy Spirit, but ended up in a bidding war with JetBlue $(JBLU)$ and eventually bowed out. Spirit and JetBlue wound up ending their merger deal in 2024 after a court sided with the Justice Department, which said that a merger between the two airlines would hurt competition.

Shares of Frontier are up more than 38% over a 12-month span. That compares with gains of around 30% for the U.S. Global JETS ETF JETS and of 31% for the S&P 500 index SPX in the same period.

Related: Could a jet-fuel shortage turn your European summer vacation into a nightmare?

-Claudia Assis

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May 06, 2026 15:56 ET (19:56 GMT)

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