Can Spirit Airlines Triple Its Market Share?http://www.fool.com/investing/general/2012/11/28/can-spirit-airlines-triple-its-market-share.aspx Jonathan Yates
November 29, 2012
Spirit Airlines is stingy and proud of it. It's the most profitable U.S. airline and flying ever-larger numbers of passengers as it seeks to raise its market share from 1% to 3%. But it is achieving that success by slashing costs and hiking fees. Can the company thrive by making customers miserable -- and should Foolish investors fly along for the ride?
When reviewing the indicators below, such as the sales growth rate, remember that Spirit is a small carrier with only 40 planes. Despite that, it's achieved industry-leading profits and strong sales growth while maintaining zero debt.
SOURCE: MOTLEY FOOL CAPS, Finviz
Success breeds contempt
Along with profits, that frugality creates contempt: There is no shortage of haters for Spirit. A Google search of "I hate Spirit Airlines" brings back about 410,000 results. The website Amplicate.com, which measures public opinion, gives it a 92% negative ranking . While that in itself is impressive, the passion of the commentators is even more so. For instance, "DavidHatesSpirit" writes that "... in my company of over five thousand frequent travelers, I intend to tell everyone to avoid [Spirit] like the plague."
However, that doesn't trouble CEO Ben Baldanza. He argues that Spirit's business model results in fares about 30% lower than the industry average, observing that, "We have no demand problem when we have the lowest pric