Loading

JetBlue guides down expectations for 4Q2015 PRASM. Aiming to keep its unit revenue edge in 2016

JetBlue has bucked industry trends in 2015 by posting growing passenger unit revenues for the first nine months of the year, while other US airlines posted sharp declines, driven by foreign exchange pressure and lower fuel surcharges. In addition to those particular challenges, pockets of soft domestic pricing have also pressured passenger unit revenues for American, Delta and United.

But JetBlue has provided guidance to a decline in passenger unit revenues of 2% to 3% in 4Q2015, which initially, and unsurprisingly, put pressure on the airline’s stock price. The company feels confident that it can continue to drive a unit revenue premium to the industry in 2016, underpinned by its new fare families product, and a new branded credit card agreement.

Most US airlines believe they can return to a flat or positive passenger unit revenue trajectory by mid-2016. If that occurs, JetBlue’s passenger unit revenue outperformance versus the industry could possibly shrink. There is also the potential that JetBlue could face some pricing pressure in 2016 from larger airlines that are opting to discount certain fares as fuel prices remain far below historic highs.

This CAPA Premium Analysis article is 1,528 words.

To access CAPA Premium Analysis you need a CAPA Membership

Your window into the latest insights

CAPA employs an industry-leading Analyst team based in Europe, North America, Asia and Australia who offer unique perspectives and independent and accurate commentary of critical industry developments globally. CAPA Members rely on our Analysis to unlock valuable insights and actionable intelligence to keep ahead of the game.

Big picture strategic view

Our Analysts don’t just report the news - they take a big picture strategic view of aviation dynamics, issues and trends and analyse the implications of these developments for you.

Global intelligence

The CAPA Analyst team is based globally to ensure our CAPA Members have access to independent, unique perspectives covering an entire spectrum of daily, worldwide commercial aviation developments.

Customise your Alerts

CAPA Members can use CAPA Alerts to receive daily, weekly or monthly and customised updates on our Analysis.

I'm very impressed by the factual and detailed analysis CAPA is always doing.

- CEO, Airline Member
To learn more, contact us:
Phone: +61 2 9241 3200 | Email: membership@centreforaviation.com