Frontier Airlines and Spirit Airlines are proposing to combine in a $2.9 billion deal that would create a larger discount airline to compete against the nation’s dominant carriers and, they say, promote lower fares.
Both are ultra-low-cost carriers that tempt travelers with rock-bottom prices for no-frills service but often generate more than their share of consumer complaints.
The deal is likely to get a close examination from antitrust regulators in the Biden Administration, which has signaled a tougher line against big corporate mergers. Consumer advocates criticized the Obama administration for allowing a string of major-airline mergers that greatly consolidated power in the industry.
However, the Frontier-Spirit combination would rank only fifth among U.S. airlines in passenger-carrying capacity and seventh in revenue. Frontier and Spirit are pitching their merger as a counterbalance to American, Delta, United and Southwest, which together control about 80% of the U.S. air travel market.
“The Biden administration has made it very clear over the last year that they would like to promote competition in the airline space, and this is really an answer to returning balance from a competitive perspective to the big four,” Frontier CEO Barry Biffle said in an interview.
