"Other than from a metro Denver or Colorado perspective, I don't see this as a bad news story -- especially for our employees," he says.
Why not? Here's his argument.
The move of operations personnel to Indy "makes sense because of existing infrastructure, existing technology. It would just be foolish to have three operations centers in one place and one in Denver. There are cost savings involved, and operational efficiencies and synergies gained from that."
Moreover, those employees who elect to move "will have their job in Indianapolis. It'll be offered to them at the same title and the same pay they currently have. And Republic is providing them with a relocation package that, by airline standards, is very impressive. It provides assistance such as paying to pack and move a household and free flights out to Indianapolis for people who want to see what the city is like. It provides them with hotel reimbursement for that travel -- and if they arrive and for some reason their housing isn't ready, we'll provide them with housing."
And if staffers choose to stay put in Colorado?
"We have a retention program based on the job that people do and their length of service," Kowalchuk explains. "And they could be eligible for severance if they're eligible."
This info was passed along in a respectful manner, he goes on.
"The employees affected by this were all notified by managers or supervisors. It wasn't something they got in the mail," he notes. "And Wayne Heller, the executive vice president and chief operating officer of Republic, and four other vice presidents were out here yesterday. They met with all of the affected employees as a group if they could make it, and we set up a call-in line for people who couldn't. They explained the move and what it meant. And I think the employees, while maybe surprised and confronted with a difficult decision, thought it was handled quite well."
Okay, so the blow was cushioned. But what's the "good news" part?
"A year ago, Frontier was perceived as an airline that wouldn't be anymore," Kowalchuk says. "But as a result of this acquisition and the moves that are being made, we are an airline that is, and an airline that will be. And I think that's important to employees. They fought for something like eighteen months to bring the company out of bankruptcy with the understanding that there would be change -- but that this change would be less radical than if we failed to make it out of bankruptcy.
"The moves that are being made now are being made to make the airline stronger," he continues. "And we'll see growth in Denver. In fact, we're already seeing growth in Denver with the expansion of a codeshare agreement with Midwest," another recent Republic acquisition; see the release below for more details. "And there's also the purchase of three new Airbus aircraft next year. That wouldn't have been possible without Frontier having been acquired by Republic, and without us having attained cost savings from the integration efforts that are going on. All of this is making Frontier stronger and ensuring that it won't be going away. It'll continue to be Republic's largest single operating entity and retain Denver as a hub."
Even so, Kowalchuk concedes that many Frontier workers are edgy, especially given the possibility of more job shifts -- something he neither confirms nor writes off for all eternity.
"I don't think 'relaxed' would be the appropriate word," he says. "But I think there's an appreciation for the fact that when we know things, we tell employees, and we tell them personally. We don't drop a letter in the mail or a pink slip on their desk."
Let's hope the latter doesn't happen, for everyone's sake. Here's that codeshare release:
Frontier Airlines Expands Codeshare Partnership with Midwest AirlinesExpansion to entire Frontier/Midwest network
DENVER (Dec. 8, 2009) -- Frontier Airlines today announced an expansion of its codeshare agreement with Milwaukee-based Midwest Airlines. Now that Midwest and Frontier are both wholly owned subsidiaries of Republic Airways, they are allowed to expand their joint code sharing program as fully affiliated carriers. The expanded codeshare, which was launched on a limited basis in September 2009, will allow customers of both airlines to travel to more destinations while enjoying a seamless ticketing and customer service experience.
Effective immediately for travel starting Dec. 13, Frontier is able to sell tickets to all Midwest destinations (except Kansas City routes, which will be added later) under a Frontier code. Also, Midwest Airlines is able to sell tickets under a Midwest code for nonstop flights for the entire Frontier domestic network (except Kansas City routes).
Further expansion of the codeshare to include one- and two-stop routes, Frontier's international routes and Kansas City routes will be announced over the course of the next few months. Once these routes are added, customers of both airlines will have complete access to the combined network.
"With today's expansion of the codeshare, Frontier customers are able to buy tickets for the first time to 10 new destinations such as Boston and Grand Rapids," said Daniel Shurz, Frontier's vice president, Strategy and Planning. "This, together with our expanding nonstop network from Denver, allows us to serve even more of their travel needs with our well-known value and outstanding service."
Both airlines' customers will also be able to participate in each other's respective frequent flyer programs -- Frontier's EarlyReturns® program and Midwest's Midwest Miles program, to earn miles and redeem them for free tickets.
