The father of countless airline fees is out.
Ben Baldanza, the CEO of low-fare Spirit Airlines, was abruptly fired as the airline that touted low-cost tickets with numerous add-on fees saw share of budget flights drop.
The Florida-based company had been losing money before Baldanza took over in 2006. He then transformed the budget carrier into an even cheaper one, touting $9 tickets (minus taxes and government fees) for one-way flights. The catch was that a passenger would have to pay more for seat assignments, food and drink, boarding passes, carrying luggage on board, and more. Seats were not able to recline so the airline could fit more people into the plane, a move Baldanza called making them “pre-reclined” seats.
The harsh style of leadership was constantly at the forefront for Baldanza, who told people that if they did not like paying the fees, they could fly with someone else. The negative persona did not harm the ousted CEO, in fact it may have emboldened him to create even more animosity. One of his shelves had an email tapped to its side from a passenger who said “I just want to let you know that your company sucks and your policy will run it into the ground.”
While the attitude towards the airline may be popular, it did not hurt the airline as revenue approached two billion annually. But passenger growth has slowed despite passenger availability. With available seats growing by 34 percent, passenger revenue has increased just 1 percent, likely a result of Baldanza’s own success.
Since Spirit has increased the number of fees other airlines have followed suit, with many major carriers using baggage and boarding fees, and the ever-unpopular extended seat space fees. This has resulted in shares in Spirit Airlines, Inc., the parent company, halving in value over the past year.
“Following the tremendous growth and success of Spirit over the last 10 years, the board and I have concluded that this is the right time to implement an orderly succession plan,” Baldanza said in a statement by the airline. In his stead, Robert Fornaro, formerly of AirTran, will take over.
Fornaro was appointed to Spirit’s board in spring 2014. He was CEO of AirTran from 2007 until Southwest Airlines bought them out. He has also worked for US Airways, recently bought by American Airlines, and Northwest Airlines, which has been purchased by Delta Airlines.