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Barry Biffle, CEO of Frontier Airlines, joined Yahoo Finance Live to break down his thoughts on the resurgence of airlines and what to expect for the remainder of 2021.
- Seana, a lot of Americans want to hit the road or, in this case, hit the skies. And how does $17 one-way sound to you for a ticket? You heard me right. Frontier Airlines, that's one of the promotions they've got going on.
But the ultra-low-cost carrier-- their ticker symbol, by the way, is ULCC. Flights usually start around $39. Let's talk about all of this with the CEO from Frontier Airlines, Barry Biffle. It's good to have you here.
And congratulations. You've launched flights from Myrtle Beach to-- you ready for this-- Buffalo, New York, Miami Portland, Maine and Providence, Rhode Island. But more important, you're predicting that you're going to be profitable in the second half of the year. How do you do it with such low fares?
BARRY BIFFLE: We've got to have the lowest costs. And we have done that for years now, and we've been a leader in the low-cost space. But not only from a ex-fuel perspective, but from a fuel perspective, we have enjoyed a really low-cost position, and that enables us to make money with really low fares.
- Barry, talk to us about the trends that you're seeing, especially in the number of bookings. What are you seeing at Frontier?
BARRY BIFFLE: So, look, I mean, bookings have been surging for several months now. People have talked about the vaccine unlocking the demand, and that's what we're seeing. And we're getting to the point now, I've been telling friends and family, if you're planning on going somewhere, you need to book it because people are literally going to run out of seats because there's just not going to be enough demand.
We've continued to add capacity as an industry, but we're almost back. Yet we're hitting records again with the passenger count. So I think by the time you get to Fourth of July, from then through the rest of the summer, I think you're going to see huge travel. So it's time to book. If you see a deal, you should buy it.
- We had Roger Dow on from the US Travel Association recently, and he was pointing out that a big part of what airlines need is the return of business travel. And a lot of people make the mistake, we were told by a former-- different airline CEO, that carriers like yours actually have a business-travel component. Can you share with us the metrics? I mean, businesses want to save money, too. Do you see a business traveler returning?
BARRY BIFFLE: So, we do see the business traveler coming back, and you're already starting to see signs of that out there. I'm seeing more sport coats in the last week. I'm seeing more individuals traveling with a laptop, which tells you what they're doing, right?
But historically, we've been less than 5% of our travel is business travel. For travel motivation, it's typically small business travelers who pay for the tickets themselves, small business owners. But I think they're already coming back, and I think by fall, I think once people go back to the office, I think you will see corporate travel back as well.
- Barry, what do you think the number is going to look like, though, when you compare it to pre-pandemic? I'm talking about business travel. Do you think we'll ever get to those pre-pandemic levels again?
BARRY BIFFLE: Well, I think you're going to exceed them. I mean, in the near-term, especially. We're doing a charity golf tournament next month, and there was a lot of questions. Do we do this in person? And now that the vaccines, and the mask rules have changed.
And we put this together, and we're sold out. We've sold out all the spots for our charity tournament. And just kind of shows you how everybody is ready to get back traveling and get back to seeing people, not just in their personal lives, but in their business lives as well. And so, I can tell you, I know my calendar's full for most of the summer and there's very few days or weeks that I have left that I'm not going somewhere or seeing someone.
So, I think it's just human nature. You want to see your friends and family, but you also want to see the people that you do business with, especially if you're in sales. And if you're not out there talking to your customer, well, your competition is.
- It's really great to hear how busy you are because, for so long, a lot of us were worried about what happened with the airlines. I just want to ask you before we talk about-- because you have international destinations, Mexico for instance-- how are you dealing with this phenomenon of the unruly passenger? Have you had any incidents with people who have just been rude to your staff or need to be perhaps reprimanded?
BARRY BIFFLE: We have. We have. It's unfortunate out there, right?
I mean, I think it's gone on far a long time. I mean, we're now 15, 16 months into this pandemic, and people are they're over it. And they're over the mask, they're over a lot of the things. And unfortunately, they've taken it out on their fellow human beings, and we're not immune to that.
Yesterday, there was the event, I think in Georgia, where unfortunately, a woman was killed just for asking someone to wear their mask in a grocery store. And that's just terrible. But I just hope that we can all get back together and save that angst. But it is a real issue. But hopefully, once the mask requirements go away in a few months, I think we'll have less aggravation on board.
- And when you take a look at the huge rebound that we've seen so far, have you been able to keep up with that demand? We talked time and time again to so many business owners. Now mainly it's small business owners.
But it happens with big companies as well. They haven't been able to fill the positions that are open. Are you seeing that at all at Frontier?
BARRY BIFFLE: Yes, we've seen that. And we're back to above 2019 flight levels and expect to grow from here, and we'll be back to full utilization by the end of the year. But look, the shortage is real. We're hearing it from a lot of people.
We actually got ahead of this. We kind of saw this coming. But I know that you look at TSA, they're having shortages. There's a lot of news about that. But I think these are just transitory.
Look, once we get through the summer and people-- everyone gets back to work, I think we'll sort out some of these labor shortages. But just like everything, I mean, it's like, we don't need masks anymore and now they're out of lipstick.
So, I think all these things will sort themselves out. Just give everybody a few months. I think the great news is the second half of this year is going to be fantastic for all parts of the economy.
- Barry, you had me when I saw you went from New York LaGuardia to Miami, or what my people call the promised land. So, we wish everybody at Frontier the best. Barry Biffle, CEO of Frontier Airlines.