A $38M annual boost forecast: Economist predicts hangar will have a big ripple effect

Nov. 3--It wasn't exactly a return to the era of Western Pacific Airlines, but Frontier Airlines' announcement Friday that it will build a maintenance hangar, hire hundreds and eventually start passenger service in Colorado Springs had civic leaders...


Nov. 3--It wasn't exactly a return to the era of Western Pacific Airlines, but Frontier Airlines' announcement Friday that it will build a maintenance hangar, hire hundreds and eventually start passenger service in Colorado Springs had civic leaders talking in tones they haven't used in a long time.

"One of the biggest economic development improvements in the last 10 years," is how Mike Kazmierski, president of the Colorado Springs Economic Development Corp., put it, addressing widespread con- cerns among business leaders about airline service.

It's a $38 million-a-year boost to the economy, said Fred Crowley of the Southern Colorado Economic Forum. Spending by the hangar's workers, he said, would create more than 500 jobs at retailers, car repair shops, hair salons and other businesses.

Mayor Lionel Rivera said it was "a great day for Colorado Springs, a day to celebrate."

Frontier said Friday it will build a maintenance hangar employing 225 at the Colorado Springs Airport and begin flights to Denver by late spring.

The Denver-based carrier likely will start serving the Springs with four or five daily flights on 78-seat regional jets and probably will expand to larger Airbus jets once the maintenance hangar opens by late 2009, Frontier President Sean Menke said after the announcement.

Frontier could eventually expand its Colorado Springs service to include nonstop flights to other cities, depending on local travel demand and opportunities available elsewhere to the carrier, Menke said during a news conference announcing the plans.

Kazmierski said he hopes Frontier eventually will serve cities from the Springs that have significant economic ties to the city but no nonstop service, such as New York, Washington, D.C., and San Jose, Calif.

Colorado Springs' options for air travel were sharply reduced in 1997, when Western Pacific moved to Denver, then shut down eight months later. For a couple of years, the carrier turned the Springs airport into the nation's fastest-growing.

Born and headquartered in the Springs, WestPac earned an enthusiastic following with its discount fares, direct service that bypassed Denver, its informal style and wacky "mystery fares" promotions. But mounting losses led to a boardroom revolt, bankruptcy protection, the move to Denver and a shutdown in 1998.

On Friday, Rivera said Frontier's arrival in the Springs fulfills his January 2003 campaign pledge to bring a low-fare airline to the city.

"Today is the day I feel that the promise has been kept," Rivera said after the news conference. "People assumed I meant Southwest (Airlines), but this is a better win for the community because Frontier is a Colorado company and is making a long-term commitment."

Frontier's expansion to the Springs should force local air fares lower by increasing competition for Springs passengers, said Andrew Goetz, a Denver University geography professor who also works with the school's Intermodal Transportation Institute.

The airline selected the Springs over Denver International Airport for the hangar because it offered "the best combination of incentives, financial support and proximity to our Denver hub," Menke said. "The Colorado Springs opportunity was a better financial fit for our needs."

The city will rebate its business personal property taxes on equipment in the hangar and will exempt aircraft parts bought by Frontier from its sales tax, saving Frontier an estimated $300,000 a year. The city will also issue tax-exempt bonds to finance the hangar it will lease to Frontier for 30 years.

"The economic impact of this announcement far exceeds the (cost of the) incentive package," Kazmierski said.

Utah-based SkyWest Airlines accepted similar, but less generous, incentives to build a maintenance hangar at the airport that opened in August and employs 90. Sky-West will get the same terms as Frontier once Frontier's hangar opens, said Mark Earle, the city's aviation director.

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