In Shurz's view, the Southwest-AirTran team-up will have only a "small impact" in Denver, at least in the immediate future. Right now, he says, Southwest has 144 daily weekday departures from Denver, while AirTran has five. However, AirTran offers non-stop flights to Milwaukee and Atlanta, as does Frontier -- so the level of competition could increase there, but only marginally.
"Whatever Southwest does in Denver it could probably have done with or without an AirTran merger," Shurz believes. "Southwest has grown aggressively in Denver since arriving in 2006. They've committed a lot of resources, and we've obviously learned to live with them. And we have various pieces of differentiation with them."For instance, he continues, "we serve over sixty destinations non-stop from Denver, and Southwest has under forty. We fly to a lot more places," including such relatively recent additions to the Frontier roster as Anchorage and Fairbanks, Alaska, plus six destinations in Mexico and a pair in Costa Rica. "And the differentiation happens domestically, too. We fly to Madison, Wisconsin, Fort Myers in Florida -- and we're adding Des Moines."
The Southwest-Frontier scrap "has been very good for consumers," Shurz feels. "It forces us to be more nimble and creative. In a literal sense, United is a bigger competitor than Southwest. There's a far greater route network overlap with United than with Southwest in Denver. But from a retail consumer perspective, Southwest is the aggressive marketer in the market."
Indeed, Southwest hasn't written off Denver even after failing to purchase Frontier last year in a contest eventually won by Republic Airways Holdings. The airline's been running a campaign using the slogan "Southwest Loves Denver" to supplement its main national message, "Bags Fly Free."The latter catch-phrase is "very simple," Shurz says -- and this straightforwardness stands in contrast to Frontier's pitch, which he sees as "more nuanced.
"In our case, our cheapest fare gets you an assigned seat -- and there are clearly customers out there who don't find Southwest's boarding process to be the most fun thing in the world. And if other things are meaningful to you, we give customers the option to buy them," including STRETCH seating, which provides more legroom than in most standard passenger sections.
Even so, Shurz maintains, "we essentially have the lowest prices in the market. We have a lower cost of operation than Southwest, and over time, we will have net lower fares. Today, I'd say most of the time, we're equal on the lowest fares, so if you want cheap travel, we're very competitive. You can great great value from Frontier -- better value, I would argue, than you can get from Southwest a lot of the time."
Getting local travelers to grasp this information hasn't been as easy as it was back in the days when United was Frontier's primary target, Shurz concedes.
"We were friendlier, we were cheaper, and we gave a better travel experience than United," he says. Now, though, "Southwest uses bullhorns, whereas United didn't shout as loudly. And even though this market has been a challenge for them, they've been persistent. If they want to make something work, Southwest will work hard to do it."The same can be said of Frontier when it comes to defending its turf.
"Denver is the largest part of our network, the most profitable part of our network," Shurz says. "We have convenience, and we're not forcing you to connect. If you fly Frontier, we're going to be non-stop wherever you're going. And we really care about Denver."
The shift of some Frontier jobs to other cities since the Republic acquisition may have created doubts about this last assertion, but Shurz says it shouldn't.
"We're aware of what the media message has been," he concedes. "But even though our parent company is in Indianapolis, Denver is the home of the Frontier brand. The vast majority of people who work for Frontier live here, and I'm talking to you from the same office on Tower Road that Frontier has had for a long time. We may not be the hometown airline in quite the same sense we were, but we're a very big player in Denver. We employ over 3,000 employees here. Southwest has less than 600.
"Did some jobs move from Denver to Indianapolis? Yes, some jobs moved. Did maintenance move out of Denver? Yes, they did -- and I know that's been a football in the current gubernatorial campaign, which I don't really want to get into. But the story's been what's leaving, and the context has been lost about how much actually stayed. And far more stayed than left. The airline didn't disappear. We're bigger in Denver than we were a year ago in terms of our schedule, and there will be more new destinations, more non-stop routes in Denver in 2011. We're growing here."
