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- JetBlue Airways Corporation
118-29 Queens Blvd Forest Hills
New York, NY
- Main hub
- New York John F Kennedy International Airport
- United States
- Business model
- Low Cost Carrier
- Domestic | International
- Association Membership
- Codeshare Partners
- Aer Lingus
South African Airways
jetBlue is a low-cost carrier based at New York JFK International Airport, with secondary bases at Boston Logan, Fort Lauderdale-Hollywood, Orlando International, Washington Dulles and Long Beach airports. Using a fleet of Airbus A320 and Embraer E-190 aircraft, jetBlue has an extensive network that serves destinations in the United States, the Caribbean, and Central and South America.
Location of JetBlue Airways main hub (New York John F Kennedy International Airport)
JetBlue Airways share price
LCCs will continue to evolve into hybrids of the original core model. CAPA and OAG consider JetBlue Airways fits the LCC profile and it is included in our reporting on this basis. Please note: when reporting for an airline is changed from or to LCC the historical data is not affected and it can lead to a distortion in the current reported data. Contact us if you have any queries.
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JetBlue’s recent launch of new service from Fort Lauderdale to its southern most destination Lima, Peru, marks an important milestone in the carrier’s strategy in Southern Florida that entails building up Fort Lauderdale to roughly 100 daily departures. Once Fort Lauderdale reaches that point, its strategic importance in JetBlue’s network will be solidified as the carrier penetrates deeper into the Caribbean and Latin America from Southern Florida.
The airline’s expansion from Fort Lauderdale continues unabated during 2014 when it launches flights to Montego Bay, Punta Cana and Port of Spain, further pressuring Spirit and Caribbean Airlines.
JetBlue presently serves two out of the three destinations – Montego Bay and Punta Cana – from other points in its network, so it believes it is executing the expansion from Fort Lauderdale efficiently as highlights its method of “connecting the dots”.
A corporate leader of any organisation requires an unusual, sometimes extraordinary range of skills. Inevitably not every CEO has these; nor does having the skills necessarily always triumph over external forces. Timing is not everything but it is important. With time, those external forces change the skill sets needed, for example when an industry is undergoing major upheaval.
Arguably, given the complexity of the airline business, a leader in this industry has greater demands placed on him (rarely her; there are very few women CEOs). And today the world must seem a particularly hostile place for legacy airline managements and their workforces, under siege from all directions. Meanwhile the Gulf carriers and many new short-haul low-cost models are changing the demands made on competitors, as protectionism slips away and hiding places become scarce.
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JetBlue continued the trend of most US carriers turning strong financial performances during 3Q2013 as its profits grew 57% year-on-year to USD71 million driven by a demand environment the carrier deemed as healthy.
The carrier is still battling some cost inflation as FY2013 unit costs excluding fuel and profit sharing are projected to rise between 2.5% and 4.5%. JetBlue stresses it is taking measures to battle the unit cost inflation, noting its sharklet programme for its Airbus A320 fleet to lower fuel burn and fleet changes that include the deferral of 24 100-seat Embraer 190s to support a fleet of 60 of the smaller jets.
Even as JetBlue is taking steps to whittle away at unit cost pressure it has experienced for the last year, the carrier is fielding questions about how it intends to proceed with margin expansion and if it will hit its return on invested capital targets.
Underlying JetBlue’s recent headline grabbing release of its new premium product that includes semi-private suites, is a network strategy and expansion that continues unabated, resting on the pillars of expanding from Boston, Fort Lauderdale and its strategic base and headquarters of New York JFK.
The latest round of market additions adhere to the carrier’s stated goals of broadening its reach into the Caribbean as Trinidad and Tobago is added to its growing network in the region. At the same time, JetBlue’s milestone 50th destination from its ever-important Boston base is Savannah, Georgia, a largely leisure destination which presently is served by US majors with regional jets to their large hubs.
With the planned new service to Savannah, Port of Spain and Port Au Prince, JetBlue is taking a three-pronged approach, serving all those markets from its strategic bases – most notably Fort Lauderdale, a market JetBlue is growing as a launch pad for strengthened service to the Caribbean.
Boston Logan Airport’s recent spree of attracting new international service continues as direct flights to Dubai are scheduled to come online in Mar-2014. Emirates Airline is to begin new service that will offer connections throughout its expanding network that covers the Middle East, Africa, Europe, Asia and Australasia.
The service caps off an interesting round of new and key international destinations from Boston. JAL during 2012 introduced direct flights to Tokyo Narita followed by Copa’s launch of direct flights to Latin America’s key connection point in Panama. Emirates’ new service to Dubai will be followed by the introduction of flights to Istanbul by Turkish Airlines in May-2014.
Emirates’ service to Boston further solidifies its leading-carrier status among the three big Gulf Airlines to the United States. But as has been the case for the last couple of years, its competitors Etihad and Qatar plan to catch up as Etihad has previously stated it plans to table new North American destinations and Qatar has listed Boston as a potential new market in the US.
Given the quickly changing competitive dynamics those three carriers are ushering into the global market place, there is sure to be an interesting response from Emirates’ rivals to these latest moves in North America. Hopefully this will be in the marketplace rather than in the corridors of Congress.
JetBlue’s decision to introduce a premium product on a sub-fleet of its Airbus narrowbodies pegged for operation on highly contested transcontinental US markets marks a new era in the carrier’s hybrid evolution. As all carriers are amping up their products on transcon routes from New York to retain and steal coveted, high-yielding passengers, the outcome of JetBlue’s gamble is tough to predict.
While the creation of its strategy to attract higher-yielding customers has likely been under development for quite some time, JetBlue’s formal introduction of its premium product occurred shortly after the airline reported 2Q2013 financial results that featured continuing cost inflation and falling unit revenues, and warnings that it will not see a reprieve in cost pressure during the current quarter.
Obviously JetBlue’s forging into new territory with its premium cabin is a long-term endeavour; but in the short-term it will need to be prudent with a significant investment of this nature as its costs continue to rise - with yields meanwhile probably lagging the new investment. The carrier recently revised its 2013 unit costs estimates upwards, driven in part by a small decrease in capacity.
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