Frontier Airlines announced up to 120 jobs will be cut at Milwaukee’s Mitchell International Airport in an effort to bring the airlines out of a financial slump.
Known as the airline with furry woodland creatures adorning the tails of its planes, Frontier Airlines lost $102.4 million last year, according to the Republic Airways 2010 Annual Financial Report.
“The reductions are being made to balance our staffing needs with our Milwaukee flight schedule which has been reduced, effective in January,” said Peter Kowalchuk of Frontier Airlines media relations. “The schedule changes were made to reduce the unprofitable flying from Milwaukee and to strengthen our Milwaukee operation.”
Kowalchuk said although about 120 layoff notices were sent, it is possible that Frontier will not have to involuntarily lay off all those employees.
“It is possible that some employees will take voluntary layoffs and that other positions will be reduced by attrition,” he said.
In 2009, Republic Airways Holdings bought Frontier — which had filed for Chapter 11 bankruptcy — with a bid of $108.75 million, according to a 2009 Frontier Airlines press release. The Indiana-based Republic owns four airlines and services approximately 1,500 flights daily to 129 cities in 41 states, Canada, Costa Rica and Mexico, according to its website.
Although it is owned by Republic, Denver-based Frontier must find passengers to fill its planes and maintain its finances while also competing with larger airlines like Southwest Airlines and United Airlines who have a large presence at the Denver International Airport.
Frontier lost $4 million for the quarter, which ended Sept. 30, due in large part to the $10 million in expenses incurred from a hailstorm in Denver that damaged planes and cancelled hundreds of flights.
The airline also lost $5 million in fuel hedges, or the attempt to lock in the cost of future fuel prices, and $4.3 million in expenses related to fleet changes, according to the Republic Airways Third Quarter 2011 Financial Results Report.
Patricia Rowe, marketing and public relations manager at Mitchell International Airport, said that while it is never desirable to hear about reductions in air service, Frontier has said the reductions are necessary to return the company to profitability.
“There is continued strong demand for air travel in southeastern Wisconsin and northern Illinois, but Frontier has said it needs to adjust its service level in response to economic pressure,” she said. “There are many changes and mergers occurring in the airline industry as airlines cope with rising expenses and fuel costs while airfares remain as low as they were 40 years ago.”
The changes and downsizes can be seen in larger airlines as well, such as American Airlines, based in Texas.
“My dad has seen a lot of pilots retiring early, so they can get the most out of their retirement benefits,” said Benjamin Valle, a sophomore at Franciscan University of Steubenville, Ohio, whose father, Capt. Charles Valle, has been a pilot with American Airlines for more than 30 years.
Five years ago, when the failing economy made the future of American Airlines uncertain, Valle’s father sold insurance as a side job to increase his income. He has since returned to flying full-time, unlike many pilots of the younger generation.
“My dad has said that airlines are having a difficult time getting new pilots to fly for them,” Valle said, “Many airlines now make it easier for pilots to get their licenses by reducing the number of flight hours needed.”