PG: When an airline merges, same thing happens, right. We’re talking about contraction. Give me an industry overview where you think the industry is right now.

BB: If you go back a number of years when there were– when there were more airlines operating than there are today, you had hubs that were created that weren’t necessarily long-term viable on their own. Pittsburgh and Cincinnati and Memphis and Cleveland, Ohio–all great cities–but they ended up with a level of service that was greater than their local demand justified.

These cities were very efficient connect points, but there were probably a dozen hubs you could connect through. So everybody’s trying to get you in the seat that would otherwise be empty on them. That kept prices real low for consumers, but it also drove a lot of losses for the industry, a fundamentally unstable industry.

After 2008, oil jumped up to $147 a barrel and the industry came to this shocking rationalization that oil prices are going to be high going forward. To make money and rethink our business, Delta bought Northwest, then United and Continental merged and then Southwest and AirTran merge, and now you see American and US Airways merging.

It’s an effort to rationalize capacity so that the airline can make money in a long-term, higher energy price environment.

PG: If you’re the mayor of St. Louis or the mayor of Cincinnati, you got a problem, though.

BB: The reality is some cities drive more origin traffic than others. In a place like Dallas, it’s always going be a big hub because a lot of people live in Dallas and a lot of people go to and from Dallas for business. And the same is true for Chicago or Atlanta. It’s just less true for a Memphis or a Cincinnati. It’s not that it’s totally true and totally untrue. But it’s less true. And that makes it harder.

PG: Back in the old days when legacy airline pulled out, Southwest would come in and the prices went down and all of a sudden everybody was matching their fares, nobody’s stepping in to fly those routes anymore.

BB: Southwest has been a terrific, terrific airline. And they still are a terrific airline. But they’re not the Southwest that they were in the ’80s and ’90s. They have higher costs. They have higher fares. At one point Southwest used to promote the fact that their highest fare was $299.

PG: I remember when they took over AirTran within 15 minutes, AirTran was announcing they were pulling outta 16 cities. Contraction happening there as well.

BB: What happens is the capacity contracts a little. That creates fewer service options. That makes fares go up. And that has created a more stable airline industry. But it’s also been bad for consumers in the sense.

That’s where Spirit comes in, because we can fly under that umbrella. And we can offer that low-price option. In some cases maybe we only fly out once a day. And if you want to go at 7:00 AM, we don’t have the option for you. But if you’re a little more flexible in your time, our one flight a day will work for you. Or maybe in some cases you have to drive to another airport. Eg. We serve Western Pennsylvania but we don’t go to Pittsburgh International Airport. We go to Latrobe Arnold Palmer airport.

PG: Talk about the cities that you fly that people don’t even know you go.

BB: We serve four cities in the country of Colombia–Cartagena, Armenilla, Medellin, and Bogotá, Colombia. We fly to Lima, Peru. We fly to a bunch of islands in the Caribbean. We fly to San Pedro Sula in Honduras. We fly to multiple points on the Dominican Republic and– and the island of Puerto Rico. We go to St. Thomas. We go to St. Maarten. We go to Aruba. We go to a lotta fun places internationally. Domestically we go to Plattsburg, New York. I don’t know if people know we go there. We go to Niagara Falls, New York. We fly to Las Vegas. We fly to the Bay Area. We fly to L.A.

PG: One of your bigger hubs came as a surprise to me…Atlantic City.

BB: Atlantic City has been a Spirit city for a long time. It’s a great way to serve Southern New Jersey. Often a lower price option than going over to Philadelphia Airport or in some cases Newark Airport.

PG: Is there an airport in your route system that is singularly responsible for any delays that other than LaGuardia, ’cause I think you’re gonna say LaGuardia.

BB: Big airports that have a lot of traffic, especially when they’re in that can have bad weather like a New York or a Chicago.

At Spirit, we because we have less total service, we have less flexibility to move our service.

Back when I worked at US Airways, for example, if there was a big snowstorm in LaGuardia, you could cancel a number of flights, protect all your customers on a flight that was leaving an hour or two later, so you could get everyone where they were going but thin out the system a little because you just flew a little less.

At Spirit, we don’t really have that option. We’ve got 12– we’ve got 12 flights a day to LaGuardia. We cancel one, we got to put all those people on another airline or ask them to wait untill the next day to fly. First one’s not a great cost option for us. Second one’s not a good service option for them, right. So we have issues in places like that. But we make it work.

One of the things we do to keep our fares low is, we fly our planes a lot of hours per day.

PG: You have departures at 1:00 in the morning.

BB: The airports are open. One of our flights to Plattsburgh leaves Fort Lauderdale around 10:00 at night and goes to Plattsburgh, gets there about 1:00 in the morning, leaves there 1:30 in the morning, gets back here at 5:00 in the morning. Frugal Canadians are on that plane, people who don’t want to pay $300 or $400 to fly out of Montreal. So they cross the border themselves. And they pay $99 or $129 or in some cases, $9 to fly onto Plattsburgh.

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