How Sun Country Will Turn Into An Ultra(ish) Low Cost Carrier

Filed Under: Other Airlines

A couple of weeks ago I wrote about how Sun Country will be transforming into an ultra low cost carrier. Sun Country is Minneapolis based, and at the moment has a bit of a unique position in the US airline industry. Almost all of their flights are out of their Minneapolis hub, they don’t charge for carry-ons, they have a first class cabin, they allow seats to be assigned for free in advance, they offer free non-alcoholic drinks in economy, and they have generous legroom.

The problem is that the airline isn’t able to command a revenue premium for what’s ultimately a superior product. On one end of the spectrum you have Spirit, which charges for everything and has terrible legroom, and then you have the legacy airlines, which have segmented the market so much that they’ll start to offer similar legroom to Spirit, charge some people for carry-ons, etc.

If Sun Country can’t command a revenue premium over the competition, they’re not doing as well as they could be. Last month Sun Country appointed a new CEO, who happens to be a former Allegiant executive, which tells you the direction the airline is headed.

How Sun Country will transform

At the time I noted how we should expect the following changes at Sun Country, per a StarTribune article:

  • Charging fees for carry-ons
  • Putting more seats on planes, which probably means removing legroom from seats, and possibly also eliminating first class (that isn’t stated explicitly, but given how low their first class fares are, I have to imagine this will happen)
  • Offering buyouts to senior employees, especially flight attendants and non-union employees with more than 10 years of experience; this was framed as an opportunity to give “long-tenured employees an opportunity to leave Sun Country if those individuals were not on board with the new vision”
  • Being less focused on their Minneapolis hub given the competition they have there, and instead trying to offer more point-to-point flights

Well, Wandering Aramean has some clues about what we can expect from Sun Country, based on a presentation yesterday afternoon by their CEO at a conference in Las Vegas. What should we expect from Sun Country? As of now it seems we have three major hints about upcoming changes:

Sun Country will cut their 737-700 fleet

Sun Country presently has a fleet of six 737-700 aircraft, and 16 737-800 aircraft. Sun Country plans on cutting their 737-700 aircraft, and instead switching to an all 737-800 fleet. They plan to grow their fleet by acquiring secondhand planes.

I’m a bit surprised to see this move. There are no doubt benefits to having a consistent fleet, in terms of scheduling, staffing, etc. At the same time, the 737-700 represents over 25% of their fleet. It’s not like they have 100 737-800s and just a few 737-700s. So for an airline that wants to grow, it seems like a curious move.

Sun Country will halve first class cabin and eliminate amenities

Presently Sun Country has 12 first class seats on their 737s, which are often a great deal. They offer free food and drinks, and it seems to be an all around solid product.

Going forward Sun Country will cut the number of first class seats in half, and will adopt a Spirit “Big Front Seat” approach. In other words, they plan on cutting back on first class amenities, meaning that you’ll just be paying for a larger seat.

I recently reviewed Spirit’s Big Front Seat, which gives you more space, but the service is identical to economy.

It’s a heck of a deal, though at the same time I wonder how the airline makes money on it, given how much more room these seats take up, and given that they don’t have the ability to generate incremental ancillary revenue. At that point I almost wonder why they don’t just cut first class. Maybe they just don’t think they can consistently sell that many seats without hurting their yields even more.

Sun Country 737-800s will feature 180 seats

When all is said and done, Sun Country’s 737-800s will apparently feature 180 seats, compared to the 162 seats they currently feature (12 first class seats and 150 economy class seats). So the seats will be significantly tighter than they are now. As a point of comparison, Southwest’s 737-800s are in a one class configuration and feature 175 seats, though feature good legroom. Meanwhile American’s 737-800 MAX with terrible legroom will feature 172 seats, though 16 of those are first class seats. Then you have airberlin’s 737-800s, which feature 186 seats in a one class configuration with tight legroom.

Bottom line

Along with Southwest and JetBlue (both of which are much larger), Sun Country was one of the few airlines that hasn’t cut their offerings to no end. Unfortunately I suspect their upcoming transformation was inevitable, though, as they haven’t been able to command a revenue premium for their extra services that are included. It’s sad to see the transformation, though not surprising.

Comments
  1. Picking up the used 738s to backfill the fleet cuts is easy. The efficiencies desired come from easier scheduling & such but also from the significantly lower unit costs to operate a 738 versus the 73G. One extra FA is required but you get ~60 more seats on board. The other operating costs are very, very similar. So standardizing on the lower-CASM fleet means (theoretically) better profits in the end.

  2. “Going forward Sun Country will cut the number of first class seats in half, and will adopt a Spirit “Big Front Seat” approach. In other words, they plan on cutting back on first class amenities, meaning that you’ll just be paying for a larger seat.”

    To me, this is the right approach. You can get decent food and a coffee for $10 in the airport. I’d rather just buy the more comfortable seat & cater my own food and entertainment. A bigger seat + reserved space in the overhead is basically all non-transcon first class is good for…

  3. It’s hard for such a small airline to gain much traction. Especially when they are competing with better-known companies. I’ve never been on Sun Country or heard much about it until these couple of posts. I suspect most people given the choice between a little airline they’ve never heard of and a crappy major that they have experience with will pick the devil they know. So even with superior service and comfort it’s difficult to succeed.

  4. more american hustling in the failed empire. other than get money, and get more money–what was their narrative? Crickets.

  5. There’s no value-add to the market in what they are proposing… May Sun Country die a slow and painful death as they descend toward the bottom of hell.

  6. This really blows! I live in MSP and I love Sun Country (especially considering the monopolistic control that Delta enjoys there). I’m not even a frequent flier but a year ago I had an emergency issue where I was stranded and needed to go back home before my original timeline and they waived the change fees and I just paid the difference in the costs of my original return flight.

    Don’t do it Sun Country!

  7. Should just reopen their route to London..and open more routes. Charge more for their charter flights.

  8. I love this airline. Not a frequent flier but when i do Sun Country is my first choice. Guess it’ll have to be Southwest going forward.

  9. I understand business and the need for profit, but what about the customer…in my opinion Sun Country is one of the better and most comfortable airlines to fly and they serve many vacation locations in Mexico and the Carribean…by making these changes they will not be as effective, they’re not American, Delta, Southwest or any of the other larger airlines…if they want to be more competitive with the other airlines offer more domestic flights and leave the service and seating as it is…A loyal Sun Country customer!

  10. Not sure I’m buying the “we offered more but it didn’t work, so we’re joining the race to the bottom business model…” bs. Sorry, not sorry.

    As several readers noted, outside of Minneapolis/St. Paul, hardly anyone even knew Sun Country existed, and that problem/responsibility of getting the word out to create brand awareness rests entirely on the shoulders of the company’s executives, and NOT necessarily or completely on the general public as often claimed by lazy and unimaginative executives seeking to take the easy way out to maximize profits by exploiting people outside of the industry who lack the knowledge about the despicable, deceitful, dishonest and predatory “bait and switch” pricing strategies that lure travelers with lowball headline, or base/basic, airfares, then put the hard squeeze on them to purchase an ever expanding and increasingly expensive array of “add-ons” that in the end, are as much, or even more, than they would’ve paid had they simply taken the time out to calculate the total amount they will pay between the time they purchase their seats, and the time the final bill arrives after their trip, and all of the other fees paid at the airport and/or onboard, are added up.

    It’s one of the biggest lies, and yet, the more the industry and its armies of highly paid consultants, lobbyists, and slick PR professionals (all of whom, by the way, seldom, if ever, fly these crappy ULCC airlines or sit in the 29-30″ pitch middle seats on the Big 3 Oligopolists but laugh all the way to the bank when the next few hundreds/billions of fliers dollars fund the next round of obscenely large stock buybacks) tell this lie, the more people seem to be willing to believe such utter untruths.

    Amazing.

    Fliers are repeatedly labeled cheapskates and told they are to blame for the dreadful abuse and humiliation most of us regularly experence when we fly, and all while being lied to and blamed for bringing this on ourselves.

    Nonsense.

    Fact is, barely anyone knew about Sun Country, so as one reader noted above, most, as happened when I tried to book others on Sun Country, insisted on flying the better known, “household brands”, even after offering my own experience with the airline, which was, and remains to this day, among the best experiences on any airline — foreign ones included.

    So, who’s to blame for that? Certainly NOT the flying public who barely, if at all, even knew the airline existed, and out of unfamiliarity, chose other, better known brands even if those airlines’ products were worse.

    One need not look any further than JetBlue to know there IS a space in the market for airlines who offer a superior coach product, with 32-34″ pitched rows, 18-18.25″ wide seats, extra legroom sections, free LiveTV with up to 100 channels on the airline’s A321s (36 channels on the A320s [until the cabin refresh begins next year when row pitch decreases to 32-33″ but the new 100 channel IFE is installed] and on its passenger pleasing Embraer 190s), free and unlimited snack basket offerings, plus free non-alcoholic beverages including bottled water.

    So, please, can we all stop believing the lie that “the market has spoken” and ONLY crappy, fee-laden, kneecap bashing, teeny-tiny seats, with generous helpings of nothing EXCEPT excuses, lies, and abuses rationalizing a shamelessly greedy business/pricing model by thieves pretending to be honest businesspeople is what people “want”.

    Have we all become so conditioned to these lies by our Oligopolistic abusers, that we’re suffering from denial and “Stockholm Syndrome” that we’re so willing to accept their bs excuses that WE’RE to blame for what passes for (appallingly bad) “service”?

    Sun Country chose the easy, greedy, unimaginative way out by joining the “race to the bottom”.

    They could’ve chosen a different flight path more like jetBlue, which has an award winning coach product, and is also very, very, very profitable.

    Too bad…because if there’s one region of the country that JetBlue has yet to spread its wings in, its the heartland, where Sun Country could’ve instead harnessed/leveraged its highly motivated, well trained, and exceptional employees who already believe in the airline, instead of telling them they’re no longer wanted.

    What a shame. Especially since the last thing the marketplace needs is yet another crappy, fee-laden, “we don’t give a lick about anything except picking your pockets” airline, when we’ve got three of them, and three more copying the worst of these three awful airlines’ worst elements, too.

    Folks, jetBlue alone proves otherwise: Airlines can offer a good inflight product AND make tons of money!!! They just have to WANT TO MAKE THE EFFORT!!!

    Other airlines who offer vastly superior products than any of the ULCCs (Allegiant, Frontier, Spirit) are Southwest (an airline which has NEVER filed for bankruptcy, NEVER had involuntary layoffs, has paid dividends every quarter for decades, and has been consistently profitable for 44 consecutive years), and Alaska Airlines (which bought another award winning airline, Virgin America, last year).

    Don’t believe the lies that ONLY crappy, fee-laden, base/basic fare only airlines are what the market “wants”.

    Choose airlines like jetBlue, Southwest or Alaska/Virgin America, which are proof one does NOT have to pay their hard earned money and still subject themselves to rip-offs, bait and switches, fee-a-paloozas, and whatever other forms of abuses, lame excuses, humiliations and degradations some airlines continue to insist we brought on ourselves.

  11. Allegient is no frills. No leg room. Not even seat pockets. Sun Country is going by the way side, you can see it coming.. I could not be an employee there and be proud of what senior MGMT is doing… Another mass Exodus of professional, well trained employees…

  12. Too bad, I was a loyal frequent flyer with Sun Country since MSP is my home base. It was nice having an airline you can call home & always count on since it was “Minnesota Nice” & naming each plane after Minnesota lakes were cute. They will now slowly go bankrupt along with all the other big mistake no longer existent airlines like Delta’s “Song” & US airways “Metro Jet”. Sun Country if you see this, Please listen to the consumers & don’t change a thing! There’s a reason you’ve been doing good all these years, stay that way. Let the Big boys be the big boys & just stick to what you know. That way your loyal customers will stay loyal.

  13. As of Jan 1 2018 in Business Class, it was never First Class, more perks gone…
    Appetizers, Apple Juice, Hot Meals (on a Jan 2, 2018 flight the cabin crew got me a free cheeseburger that was being sold back in economy!!), Hot Towels, In Flight Entertainment System(says available on flights over 2 hours but this trip and one late Dec system not offered to anyone on board) in most if not all planes no divider wall/curtains at back of Business and start of Economy, toilet next to cockpit door no longer just for Business Class so a continual line of people going through Business Class section— a nightmare for the cabin crew up there as they have little work room to start with. Menu booklet did not note but looks like gone are free wine and after meal liquors. What did we all expect with this new CEO from a Spirit Airlines look alike. Every cabin crew I talked to, I am a retired airline pilot, cannot wait to get out of Sun Country–retire or leave!!! We have our last pre booked flight in Business Class in August and we are done. As we can afford it we travel 5-6 months a year, half overseas, in business class for a more comfortable flight. So we will be moving our business from Sun Country after August back to the majors that appreciate Business Class travelers—if you doubt that read how much money they are putting into upgrading their Business Class cabins in the next few years. If Sun Country cannot afford to complete with the majors in Business Class service they should eliminate it and become a cattle car type carrier. As it looks now with press reports number of Business seats will be cut in half from 12 in 2018 or maybe gone altogether.
    Yep they are rushing to the bottom and we will be around only as long as it takes to get through August 2018…

  14. Just received an email from Sun
    Country announcing their plans to eliminate their Elite status in their rewards program. (As a parting gift they matched the miles I earned last year). As a frequent flyer loyal to sun country for the past 4 years I’m incredibly disappointed. Looks like I’ll be switching to delta as there is little point in remaining loyal to an airline without perks for frequent fliers. Those perks are what make frequent travel palatable.

  15. This is unfortunate. One of the main reasons my spouse and I fly (flew) Sun Country was the affordable business class experience – which includes being treated like you’re paying for business class (hot meal, even a towel, etc.)

    This week in Sun Country’s business class (4 hour flights between San Diego and MSP) we found plastic only (no glassware, no silverware), no hot meal (same sandwich and chips they sell in coach) and what amounts to paying extra for the seat only.

    We will be moving our business back to Delta – not because we want to, but at least there for a few extra dollars we get the business class experience. Good luck Sun Country! We enjoyed your experience for many years.

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