Republic Airways Announces Termination of Frontier Agreement
Apr 23, 2008, 8:41 am
#1
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Republic Airways Announces Termination of Frontier Agreement
INDIANAPOLIS--(BUSINESS WIRE)--April 23, 2008--Republic Airways Holdings (NASDAQ/NM: RJET), today reported that it has reached agreement with Frontier Airlines with respect to Frontier Airlines rejection of its Airline Services Agreement ("ASA") in Frontier Airlines' chapter 11 cases. The agreement is subject to customary approvals. Currently, the Company is operating 12 E170 aircraft under the ASA.
"We have enjoyed our partnership with Frontier and have a lot of respect for their people," said Republic CEO Bryan Bedford. "It's unfortunate that despite their many efforts to reorganize their business outside of Chapter 11, factors beyond their control conspired to force a deeper reorganization. We wish them success in their continuing efforts to combat persistently high oil prices."
The agreement provides for an orderly wind-down under which the Company will remove four aircraft on May 1, an additional six aircraft on June 2 and the final two aircraft on June 23, 2008. Immediately prior to Frontier's filing, the Company was generating approximately $6 million in gross monthly revenues under the ASA. Under the ASA, Frontier pays for certain costs such as fuel and landing fees directly.
The Company has additional commitments on five E170 aircraft that would have otherwise been placed into service with Frontier during the second half of 2008. The Company will seek to place the aircraft into service with other airline partners and/or sell the aircraft.
"We appreciate the great job Republic has done in helping us serve our customers," said Frontier President and CEO Sean Menke. "Republic, while operating under the Frontier brand, provided a safe, efficient and customer friendly product that is hallmark to our Company. Unfortunately with current economic conditions and other business changes, we have been forced to drastically rethink the use of regional aircraft in our fleet mix."
The Company intends to file a damage claim for approximately $260 million arising out of Frontier Airline's rejection of the ASA. The ultimate amount of the Company's claim will be determined in the future by the Bankruptcy Court. The ultimate recovery value of the claim is unknown at this time.
Management will discuss the Frontier situation during the Company's regularly scheduled 2008 first quarter earnings conference call scheduled for Thursday, April 24th at 11:00 a.m. EST.
Republic Airways Holdings, based in Indianapolis, Indiana is an airline holding company that owns Chautauqua Airlines, Republic Airlines and Shuttle America. The airlines offer scheduled passenger service on approximately 1,300 flights daily to 125 cities in 37 states, Canada, Mexico and Jamaica through airline services agreements with six U.S. airlines. All of the airlines' flights are operated under their airline partner brand, such as AmericanConnection, Continental Express, Delta Connection, Frontier Airlines, United Express and US Airways Express. The airlines currently employ approximately 5,000 aviation professionals and operate 226 regional jets.
We have enjoyed seeing all of you on our flights. It has been our pleasure serving the F9 community. Thanks for the memories....
"We have enjoyed our partnership with Frontier and have a lot of respect for their people," said Republic CEO Bryan Bedford. "It's unfortunate that despite their many efforts to reorganize their business outside of Chapter 11, factors beyond their control conspired to force a deeper reorganization. We wish them success in their continuing efforts to combat persistently high oil prices."
The agreement provides for an orderly wind-down under which the Company will remove four aircraft on May 1, an additional six aircraft on June 2 and the final two aircraft on June 23, 2008. Immediately prior to Frontier's filing, the Company was generating approximately $6 million in gross monthly revenues under the ASA. Under the ASA, Frontier pays for certain costs such as fuel and landing fees directly.
The Company has additional commitments on five E170 aircraft that would have otherwise been placed into service with Frontier during the second half of 2008. The Company will seek to place the aircraft into service with other airline partners and/or sell the aircraft.
"We appreciate the great job Republic has done in helping us serve our customers," said Frontier President and CEO Sean Menke. "Republic, while operating under the Frontier brand, provided a safe, efficient and customer friendly product that is hallmark to our Company. Unfortunately with current economic conditions and other business changes, we have been forced to drastically rethink the use of regional aircraft in our fleet mix."
The Company intends to file a damage claim for approximately $260 million arising out of Frontier Airline's rejection of the ASA. The ultimate amount of the Company's claim will be determined in the future by the Bankruptcy Court. The ultimate recovery value of the claim is unknown at this time.
Management will discuss the Frontier situation during the Company's regularly scheduled 2008 first quarter earnings conference call scheduled for Thursday, April 24th at 11:00 a.m. EST.
Republic Airways Holdings, based in Indianapolis, Indiana is an airline holding company that owns Chautauqua Airlines, Republic Airlines and Shuttle America. The airlines offer scheduled passenger service on approximately 1,300 flights daily to 125 cities in 37 states, Canada, Mexico and Jamaica through airline services agreements with six U.S. airlines. All of the airlines' flights are operated under their airline partner brand, such as AmericanConnection, Continental Express, Delta Connection, Frontier Airlines, United Express and US Airways Express. The airlines currently employ approximately 5,000 aviation professionals and operate 226 regional jets.
We have enjoyed seeing all of you on our flights. It has been our pleasure serving the F9 community. Thanks for the memories....
Apr 24, 2008, 8:59 am
#3
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I suppose there's a chance Republic can get UA to use a few of the E170s for operation, since they're retiring 30 737s by the end of the summer. Don't know how big that chance is, though.
Apr 24, 2008, 10:04 am
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I doubt that UA is going to want to add more regional jets, no matter how nice the EMB's are... no way they can compete on fuel efficency with oil at $120/bbl and climbing.
I wonder how A380 orders are going, with it being the world's most fuel-efficent aircraft per seat.
Too bad about these planes, they were nice... I will always remember my one and only "business class" flight on Frontier, in row 1 on a newly-added aircraft before they had removed the business seats put in by their last customer.
I wonder how A380 orders are going, with it being the world's most fuel-efficent aircraft per seat.
Too bad about these planes, they were nice... I will always remember my one and only "business class" flight on Frontier, in row 1 on a newly-added aircraft before they had removed the business seats put in by their last customer.
Apr 25, 2008, 3:07 pm
#5
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Denver's Frontier Airlines ends jet service to five cities
Frontier Airlines Holdings Inc. took one of its first significant steps to restructure operations Wednesday, ending a regional jet pact with Republic Airways and announcing plans to eliminate service to five cities.
http://www.msnbc.msn.com/id/24276743/from/ET/
Frontier Airlines Holdings Inc. took one of its first significant steps to restructure operations Wednesday, ending a regional jet pact with Republic Airways and announcing plans to eliminate service to five cities.
http://www.msnbc.msn.com/id/24276743/from/ET/
Apr 26, 2008, 12:25 pm
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Republic piliot's take on F9
Sat next to Republic E170 piliot last night on a DAL-LIT Southwest flight. he stated that republic had 56 throttle jockeys based in DEN to relocate and absorb. He flews from Houstan and said they can't use all the planes and drivers. thus the 200+ mil claim against F9. he said they were already trying to sell E170 jets to Expressjet but they are bleeding to much red ink also.
Apr 27, 2008, 5:28 pm
#7
Original Poster
Join Date: Sep 2007
Location: The views I express here are not necessarily supported by any airline or codeshare partners, nor do I represent their views and/or opinions. They are my own OPINIONS dont like them dont read them.....
Posts: 1,462
Sat next to Republic E170 piliot last night on a DAL-LIT Southwest flight. he stated that republic had 56 throttle jockeys based in DEN to relocate and absorb. He flews from Houstan and said they can't use all the planes and drivers. thus the 200+ mil claim against F9. he said they were already trying to sell E170 jets to Expressjet but they are bleeding to much red ink also.
We have over 100 pilots and 110 F/A's based in DEN. Pilots were offered displacements to a set group of bases and F/A's were granted transfer to any base at any of the three companies...
We have a contract with UA in the coming months for more
170's that we were planning on pulling from our DL operation when we convert DL to 175's. We also can use some for spares on the US side. Also with mesa in a doubtful situation we may get to use our planes as a stop gap measure...
We will not be furloughing anyone at this point and LOA have been granted to those who wanted them. I don't think the situation is as bad as everyone make it out to be. We were short staffed and now we are over staffed and the senior crew members can start dropping their lines to enjoy the summer...
Apr 27, 2008, 8:26 pm
#8
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