Budget airline king Bill Franke warms to first-class seats and premium upgrades

Budget airline king Bill Franke is warming to premium upgrades. Discount airline pioneer and Frontier Airlines Chairman Bill Franke is warming to more upscale perks. In an interview with CNBC, Franke said he thinks better, roomier seats make sense for Frontier in the U.S. but that a more traditional budget model still works in emerging markets. Franke, 89, has invested in or operated budget airlines around the world and his former employees are now CEOs at some of the biggest U.S. carriers. For decades, William Augustus Franke, Frontier Airlines' chairman and a serial airline investor, made a killing selling cheap plane tickets and charging fees to check bags, to pick seats and for everything else. Now, he says first-class seats and other traveler comforts are in order — at least in the United States. Frontier is planning to roll out first-class seats next year on its Airbus fleet. It's also joined a growing list of airlines adding SpaceX's Starlink Wi-Fi on board as it seeks to return to steady profitability. "We're not trying to have a Singapore Airlines first class," Franke, 89, told CNBC in late June at the model airplane-filled offices of Indigo Partners, the private equity firm he founded. "What we're trying to do is give the consumer an option," he said, calling it at once upscale and competitive. The ultra-low-cost airline model that Franke, who goes by Bill, pioneered has faced a reckoning in recent years. A jump in pilot salaries, maintenance costs and operating expenses, along with a boom in premium travel, have hit long-profitable and fast-growing budget carriers. Maintaining strong growth and keeping costs low were sacrosanct for that sector for years. Another pillar was not giving things away for free. At the 2017 Dubai Air Show, where he made a record Airbus aircraft order for the empire of airlines he invested in, Franke likened some consumers to teenagers and "spoiled brats," saying they expected to get low fares and what are now add-ons without paying for them, CNBC reported at the time. "They had been flying with all the amenities for ever and ever and that's what they think they ought to get," Franke said at the time. But since then, larger, more powerful rivals like United Airlines and Delta Air Lines have copied the model for their cheapest tickets. They've started offering bare-bones fare options and adding fees for everything else. This year, they even brought that pricing strategy to their first classes and plush, long-haul suites to increase revenue, stripping customers who choose that option of a free seat choice, among other restrictions. Franke has owned, operated or invested in budget airlines around the world, from Chile to Hungary to the Philippines to the U.S. He was an early investor in European budget carrier Ryanair. His legacy stretches across the airline industry: Many top airline executives, including the CEOs of United Airlines and American Airlines, worked under him earlier in their careers. Franke also ran Spirit Airlines until 2013, before becoming the chairman at Frontier at the end of that year. He tried to merge the two carriers in 2022 but Spirit shareholders voted for another offer, all cash, from JetBlue Airways. That deal fell apart after a federal court ruled it violated antitrust laws in January 2024. Struggling on its own, Spirit collapsed in May, the biggest U.S. airline failure in decades, leaving Frontier as the largest discounter in the country. Franke said he's far from out of the game and remains a major Frontier shareholder.