Loading

jetBlue Airways: confident of long term margin performance, despite short term RASM pressure

Premium Analysis

jetBlue Airways feels confident about its unit revenue trajectory, even as its 1Q2017 performance in that metric will be weaker than at some of its larger industry peers. The company has stopped short of predicting when its unit revenue will turn positive, opting not to set expectations that could fail to materialise.

Still, jetBlue believes its current and future network composition will position the airline to bolster its revenue generation, along with contribution from its Mint premium product, branded credit card pacts and fare bundles.

The company remains confident it can deliver competitive margins at growth rates in the high single digits for the near term. The majority of jetBlue's growth centres on its focus cities, where it holds dominant positions. It continues to build out Boston and Fort Lauderdale, touting its ability to leverage its strong position in those markets to drive revenue.

For the past several years jetBlue has undertaken numerous initiatives to build up its corporate base, ranging from making its schedule offering attractive in Boston to the creation of Mint. The gamble on Mint has paid off, and helped jetBlue capture significant corporate share in Boston. But jetBlue fundamentally remains weighted toward leisure passengers, and the company believes a higher leisure passenger base should help it to maximise returns.

Become a CAPA Member to access Analysis Reports

This CAPA Premium Analysis Report is 1,456 words.
Become a CAPA Member

Our Analysis Reports are only available to CAPA Members. CAPA Membership provides exclusive access to in-depth insights on the latest developments in the aviation and travel industry, developed by our team of dedicated analysts located in Europe, North America, Asia and Australia.

Each report offers a fresh perspective on the latest industry trends and is available online or via the CAPA mobile app, with customisable alerts to help you stay informed and identify new business opportunities.

CAPA Membership also provides access to our full suite of tools, including a tailored selection of more than 1,000 News Briefs every week and comprehensive data and analysis on thousands of companies around the world.