Frontier Airlines will return to the Missoula market this summer, but it will reduce its weekly flights to Denver International Airport from four days to three, local officials confirmed.
The reduction in service has prompted air travel and economic development advocates in Missoula to launch a new plan to boost the city’s ability to compete with other markets and to provide revenue guarantees to airlines considering new or expanded service.
“We love having Frontier here, and they’re important to our market,” said James Grunke, president and CEO of Missoula Economic Partnership. “But we don’t know how long their commitment will be to our market, or how that will work with our business model.”
Frontier re-entered the Missoula market last year after a 19-year absence. Over seven months, flights ran at 90 percent capacity and helped make 2014 the busiest year ever at Missoula International Airport.
But as traffic in Missoula grew, thanks in part to Frontier, the airline announced in November that it would cut flights and jobs at DIA because increased taxes and landing fees had made the hub unprofitable.
According to the Denver Post, the airline also cited the lack of incentives at DIA as its reason to move. It described the changes as "right sizing" the airline.
“Frontier, as an airline, is looking at city-to-city destinations as opposed to the hub-and-spoke model,” Grunke said. “Our task force is working on developing a more robust revenue guarantee program. Absent revenue guarantees or risk sharing, we’ll always be at a competitive disadvantage.”
Grunke said federal programs are available to airports to help attract new air service. They’ve been used successfully in places like Boise, Idaho, which used its funding to launch new direct flights to Houston.
"Airports are having to compete for service as airlines look at different locations and what represents the best economic decision for them,” said Cris Jensen, director of Missoula International Airport. “Part of that is incentives, and other communities are putting together and offering incentive packages.”
Grunke noted Jackson Hole, Wyoming, for its unique approach to providing revenue guarantees for air service. The owner of Jedediah’s restaurant at Missoula International owns the same restaurant at the Jackson Hole airport and is lending insight to that airport’s success.
If revenue is raised, Grunke said, it will be up to the community on where to place it. Options range from new service to cities like Dallas or New York City, or year-round service to locations that are now served seasonally, such as Chicago or San Francisco.
“We’re looking at what new markets make sense to us,” Grunke said. “It’s going to come down to the community’s willingness to put up the revenue to get the airlines.”
Jensen said Missoula’s passenger count represents the local market well and could be enticing to airlines if guarantees were also there.
More than 667,000 passengers either arrived in or left from Missoula. Enplanements were up roughly 12.6 percent while deplanements increased around 12.1 percent.
“As we’re looking at our seat projections going forward, we’ll have a good year,” Jensen said. “Looking through to June, we’re going to be up 14 percent in available seats over last year. We like that trend.”
The increase is due in part to Delta Air Lines' larger jet sizes and Alaska Airlines' year-round flights to Portland, Oregon. Despite the loss of a single Frontier flight, Jensen said the airport’s service will remain stable, if not grow.
“Frontier was pretty rock solid, and they were happy with the performance of the flights here,” said Jensen. “They’ll start service again on May 14, which is a little earlier this year than last year.”