CHICAGO, Sept 21 Reuters Travel boom has delivered bumper earnings for U.S. carriers, but nofrills airlines such as Frontier and Spirit are struggling to return to sustainable profitability.
That has made some of them weigh premiumprice offerings, including firstclass seats, customer lounges and branded foods even as they expect fares to remain the primary driver for bookings.
Ultra lowcost carriers offer a nofrills experience at rockbottom fares and charge heavily for ancillary services.
They were tipped to be the big winners after the pandemic, but persistent operational constraints have exacerbated their cost pressures, making it imperative to find new highmargin revenue streams.
With consumers more willing to splurge on travel, demand for premium cabins has gone up. This together with soaring bookings for flights to Europe and Asia have allowed the legacy airlines Delta, United and American to mitigate inflationary pressures.
Budget carriers lack these products.
Frontier CEO Barry Biffle said while he will not invest in longhaul jets, he has been struck by a greater desire among leisure travelers to pay for firstclass seats on domestic flights.
Frontier is watching the trend very carefully and would consider adding premium seats if it lasts for multiple years, he said.
If people are really willing to pay that much for a premium, maybe there is an opportunity, Biffle told Reuters.
Similarly, Minneapolisbased ultralowcost carrier Sun Country is…