by Donald Wood
Last updated: 9:55 AM ET, Thu June 6, 2024
United Airlines CEO Scott Kirby said during a recent
interview that he believes ultra-low-cost carriers are going out of business due
to a “flawed business model” and poor customer service.
According to Kirby’s interview with The Air
Show, the United CEO called out low-cost carriers like Frontier Airlines
and Spirit Airlines, which offer cheaper ticket prices due to unbundled fares, limited
onboard amenities and lower levels of passenger comfort.
When asked about the long-term feasibility of discounted
airlines, Kirby said their strategy was “fundamentally flawed” and that “the
customers hate it.” The United CEO also believes low-cost carriers do not treat
their customers with the proper respect, driving many travelers back to larger
airlines operating across the United States.
Frontier CEO Barry Biffle previously stated in an interview
that the “lowest cost always wins,” but when asked about this, Kirby said the
fellow chief executive officer was “dead wrong,” and reiterated that “best
service always wins.”
Over the last month, Frontier and Spirit have made major
customer experience improvements, though, with the former eliminating
change fees, adding upfront prices, and expanding customer benefits. The
latter also dropped flight
change and cancellation fees.
While the changes are welcomed by travelers on a budget,
Kirby said the changes were an “internal acknowledgment that the
[ultra-low-cost] business model doesn't work.”
Kirby was quick to criticize the low-cost alternatives to
United, but he admitted that the travelers who do not fly often and prefer the
more affordable airfare forced his airline to introduce basic economy tickets,
which mirror the no-frills options offered by Frontier and Spirit.
“They want the lowest price, and they're willing to have a
disaggregated price,” Kirby told The Air Show. “So, we needed to build a basic
economy cup.”
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