NEWS: Frontier Airlines Caught by Bad Timing?

UPDATE 1-Frontier Air could face serious cash crunch Dang! Timing is everything and Frontier Airlines may have gotten caught a little over extended. Frontier has been trying, unsuccessfully, to secure financing to cover purchase commitments on 4 shiny new Airbus A319's at the same time as Southwest Airlines is prepping to launch a frontal assault on Frontier's home turf, Denver International Airport, in January. When you couple new competition from Southwest with continued competition from a bankruptcy protected United Airlines it looks like you get a situation that makes potential investors want to sit back and...ummm...observe. Click Read More!

According to the article Frontier is warning that no financing may mean no new jets which could hinder their growth plans. Growth may be key for long term liquidity. No new jets for Frontier means no direct path to add new capacity into the mix and would force them to re-think current routes and plans.

Fares will almost certainly drop as Southwest dumps in new capacity to Phoenix, Chicago and Las Vegas. This will likely be made worse by United who may decide to dump in their own capacity in an attempt to minimize Southwest's success in Denver. On the other hand, United is still pretty cranky about their inability to run Frontier out of Denver, a traditional United stronghold. So they might end up using Southwest's entrance into Denver as an opportunity to take another shot at Frontier's well-being.