Frontier Airlines 2004 Annual Report Download - page 11

Maintenance of Aircraft and Training
Using a combination of FAA certified maintenance vendors and our own personnel and facilities, we maintain our aircraft on a scheduled and "as - needed" basis. We emphasize
preventive maintenance and inspect our aircraft engines and airframes as required. Chautauqua has an agreement with Rolls - Royce to maintain the engines on our Embraer regional jet aircraft
through November 2012, an agreement with Hamilton/Sunstrand to maintain the auxiliary power units, or APUs, on our Embraer regional jets through August 2009, an agreement with
Honeywell to maintain the avionics on our Embraer regional jets through January 2012 and an agreement with Goodrich to maintain wheels and brakes on our Embraer regional jet aircraft
through June 2014. Under these agreements, we are charged for covered services based on a fixed rate for each flight hour accumulated by the engines or airframes in our service during a
month. The rates are subject to annual revisions generally based on the Bureau of Labor Statistics' labor and material indices.
We believe these agreements, coupled with our ongoing maintenance program, reduces the likelihood of unexpected levels of engine, APU and avionics maintenance expense during their
term.
We have also developed an inventory of aircraft spare parts and have instituted a computerized tracking system to increase maintenance efficiency and to avoid excess inventories of
spare parts.
We perform our heavy and routine maintenance projects at our facilities in Indianapolis and Columbus and we perform routine maintenance services from select line maintenance stations.
All mechanics and avionics specialists employed by us have appropriate training and experience and hold required licenses issued by the FAA. We provide periodic in - house and outside
training for our maintenance and flight personnel and also take advantage of manufacturer's training programs that are offered when acquiring new aircraft.
We have an agreement with FlightSafety International to provide for aircraft simulator training for all of our pilots. We have no current plans to acquire our own simulator in the near term
and believe that FlightSafety or other third party vendors will be able to provide us with adequate and cost effective simulator training to implement our growth plans.
Employees
As of December 31, 2004, we employed 2,304 full - time equivalent employees. The following is a table of our principal collective bargaining agreements and their respective amendable
dates as of December 31, 2004:
As of December 31, 2004, we had 374 maintenance technicians and other maintenance personnel, who are not currently represented by any union, and 130 administration and support
personnel. Because of the high level of unionization among our employees we are subject to risks of work interruption or stoppage and/or the incurrence of additional expenses associated with
union representation of our employees. In connection with our proposed acquisition of 28 additional Embraer regional jets required to meet our obligations under our code - share agreements and
related expansion, we anticipate hiring approximately 750 additional employees, many of whom will be represented by a union in their employment. We have never experienced any work
stoppages or other job actions and generally consider our relationship with our employees to be good.
Code
- Share Agreements
Our code-
share agreements with US Airways, American, Delta and United authorize us to use their two - letter flight designator codes ("US," "AA," "DL" and "UA") to identify our flights
and fares in their computer reservation systems, to paint our aircraft with their colors and/or logos, to use their service marks and to market and advertise our status as US Airways Express,
AmericanConnection, Delta Connection and United Express, respectively. In connection with a marketing agreement between Delta, Continental Airlines and Northwest Airlines, certain of the
routes that we fly using Delta's flight designator code are also flown under Continental's or Northwest's designator codes. Under our code - share agreements with US Airways, American and
Delta, we are compensated on a fixed - fee basis on all of our US Airways Express, AmericanConnection and Delta Connection flights. We are similarly compensated under our code - share
agreements with United. In addition, under our US Airways, American, United and Delta code - share agreements, our passengers participate in frequent flyer programs of the major airline, and
the major airline provides additional services such as reservations, ticket issuance, ground support services, slot rights and gate access.
Employee Group
Approximate Number
of Full - Time
Equivalent Employees
Representing Union
Amendable Date
Pilots
1,019
International Brotherhood of Teamsters Airline Division Local 747
October 2007
Flight Attendants
523
International Brotherhood of Teamsters Airline Division Local 210
Currently under federal
mediation
Customer Service
226
International Brotherhood of Teamsters Airline Division Local 135
December 2005
Dispatchers
32
Transport Workers Union of America Local 540
February 2007
6