JetBlue’s Anchorage Move Seems Smart, Others Should Follow

I’m still catching up on news from last week, and one thing I meant to touch on was JetBlue’s announcement that it will fly from Long Beach to Anchorage next summer. I’ve received several emails from people who think this is crazy and that it makes no sense, but I think it’s a great move. The thought of a growing low fare carrier presence in Alaska must make Alaska Airlines nervous, but there’s a lot of room for lower fares in Anchorage during the summer.

JetBlue Goes to Anchorage

Anchorage is a really unique market. During the summer, hordes of tourists go up to enjoy 20 hours of sun and mild temperatures. In addition, boatloads of people take one way cruises between Alaska and either Seattle or Vancouver, so they need flights, at least one way. But during the winter, the tourists stay away, and only those who live there or who have business up there bother making the trip.

Anchorage has, for the most part, been the domain of Alaska Airlines, and Seattle is the main jumping off point for service to Anchorage. Looking at a random Tuesday in January, Alaska has 12 flights a day. And that’s during the off season. Try that same Tuesday in July? There are 19 daily flights. In fact, there is hourly service from 8a to 10p, sometimes even half-hourly in there. There’s no question the demand is there.

And those 19 daily flights are filled to the brim even with the insane number of summer seasonal destinations that other airlines use to siphon traffic away. But other airlines aren’t the only ones getting in on the seasonal boom. Alaska has seasonal destinations as well. For example, LAX sees two daily flights during the summer while there are none during the winter.

But of all those flights, including seasonal ones, do you know how many are on low fare airlines? Eleven flights per week. Yep, Frontier has a daily flight from Denver and Sun Country flies four times a week from Minneapolis. That’s it. So the bigger question for me is . . . why is it taking so long for low fare airlines to try this out?

Is it a technical issue? No. Unlike Hawai’i, you don’t need extended overwater capability for Anchorage flying. Is it the distance? That’s probably a big piece of it. Seattle to Anchorage is nearly 1,500 miles, or about the same distance as from Phoenix to Chicago. Let’s say you’re AirTran and you want to go from Atlanta – that’s 1,000 miles further than going from Boston to San Diego. It probably doesn’t work.

For Southwest, it’s probably an issue of getting beyond its airport model. It doesn’t do seasonal destinations, and Anchorage would be a disaster in the winter. Maybe it’ll reconsider at some point. (CEO Gary Kelly did mention Anchorage as something Southwest could look at during Media Day last week, but he gave no indication that the airline would.) It’s also tougher for Southwest because it doesn’t do redeyes, and Anchorage is the perfect redeye market.

So that leaves very few low fare airlines as good candidates. I would think Virgin America could do it from San Francisco if it felt like it, but JetBlue is also a natural fit. JetBlue leaves a fair number of airplanes in Long Beach overnight, and now it can fly one of those airplanes instead of parking it. The flight leaves Long Beach at 740p and is back the next morning at 733a, ready for another day of work.

Also, while JetBlue has a finite number of slots at Long Beach, it can move them around seasonally. Is it worth cutting out one of the multiple-frequency short-haul flights for a couple of months? I’m sure. Right now, the lowest fare Alaska has filed from LA to Anchorage is $331 roundtrip, but you can bet that lowest fare won’t be available much on peak days. JetBlue has about the same fare right now, and that’s good money for the lowest fare in the market. My guess is JetBlue will sell more of the cheap fares than Alaska would.

If I’m Alaska, this in itself isn’t that concerning, but the potential for future growth by low cost airlines is. Then again, Alaska Airlines is a lifeline for so many people, that this may not be a huge issue. But it is an opportunity and JetBlue is smart for trying to take advantage of it.

[JetBlue photo By Aaron Gustafson from Hamden, CT, USA (jetblue airplane) [CC-BY-SA-2.0 (www.creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons]


18 Responses to JetBlue’s Anchorage Move Seems Smart, Others Should Follow

  1. The bigger picture is that Alaska is still the main carrier flying within Alaska where all the high fares are. They are used to others flying to/from ANC and maybe FAI, so JetBlue with one flight for the summer may not give them cause to panic.

    People on 7 days cruises will tend to stay with one carrier they can use at each end of their journey and since most cruise ships are not U.S. registered those cities tend to be ANC and YVR.

    But like you said they just have those aircraft parked for the night, so why not try something different for a few months during the summer. As long as they stick with their summer start/stop dates and don’t end the service sooner, they will not tick anyone off and it’s a good way to test a market.

  2. Ben says:

    I think part of the reason Alaskans are so loyal to Alaska Air is because they want an airline they can fly there year round. I know when I lived there, I wanted an airline that I could earn reward points (and elite status), but most carriers called it quits after the summer, so for year round loyalty, it was Alaska or legacy carriers, or nothing. Maybe I’m overly optimistic, but if JetBlue could find a way to make this 1 daily flight work year round (especially if Alaska makes LA bound passengers connect in Seattle during the winter), I think they could build a loyal following.

    • Fred says:

      The JetBlue flight would really only be for tourism and leisure travelers. Although it might work year round for the few people going to Anchorage from the LA area and vice versa for business (or any other reason), that would be a fairly small market. Flying through Seattle would be a shorter distance and time with 12 flights a day instead of 1 if you are trying to get to anywhere else in the country.

      • Scott says:

        BUT — there is also a decent leisure market during the winter for Alaskans who want to head south. A once-daily (or few times per week) link to LGB could potentially link-up with connections to MCO, FLL, etc. I recognize it’s not the most geographically-optimal route to get from Alaska to Florida, but if B6 can attract a following with low-fares and great service, leisure customers may be willing to take the more circuitous routes via LGB.

  3. bch says:

    NW now DL offers ANC-MPS year-round I think, in addition to season nonstops to DTW and SLC. CO had a EWR-ANC 737 nonstop for a while some years back but now it’s a onestop over SEA. In this “new” and more enlightened era of controlled capacity rather than market share, city pairs get only what the demand requires, no more. Nothing wrong with that. Yes, it’s a shame to let a parked aircraft sit overnite but that costs less than a half-empty flight with crew and fuel costs that duznt make $$.

    • Flights to ANC…..even in winter are rarely half empty. Year-round MSP, SLC, PHX,PDX, ORD,SEA,HNL, OGG Nonstops to ANC are almost always consistently oversold-no matter what time of year. And ANC flights are among the highest-yield routes in North America. We have a very robust economy here plus nearly half a million local residents living in Anchorage/Matsu Valley.

  4. I love the picture! Although the last step off the Alaska stairs on the Alaska jet looks like a big one. Perhaps thats representative of their lowest fares?

  5. Trent880 says:

    This is going to be a disaster. 100% local, little brand recognition in LGB and even less in ANC, and AS is a vigorous competitor.

    • Craig says:

      Uh, what? JetBlue is by far the largest airline at LGB, how can you possibly say it has “no brand recognition” there?

    • It was not a disaster at all! Each JetBlue flight that I was on throughout the summer was sold out. We are going to see them again in 2012, hopefully with even more service!

  6. Kim says:

    After living in Alaska for 10 years, anything to avoid paying $800 just to get to Seattle would be very much appreciated.

    • When low-fare airline Reno Air(purchased and dismantled by American) competed with Alaska, fares were as low as $69 each way, and rarely more than $300. AS has not had any real competition in the Seattle market in years. Even though Continental flew 2 Boeing 757s a day on the SEA-ANC route, they code-shared with AS, meaning they put their code on each other’s flights which not competing at all.

  7. travelnate says:

    I live in Alaska (Juneau), and many people LOVE to complain about Alaska (but love them when Alaska donates to their charitable cause). One of the reasons airfares are so high up here is the winter operations. Having all these awesome technical toys that Alaska uses aren’t cheap to test, certify by FAA, and install. Here in Juneau, we’re lucky to get 2/3rds of our flights in the winter, the rest are typically circling for an hour or divert to Whitehorse/Sitka/Ketch/Yakutat. People seem to forget that a 2 hour flight to Seattle, with a stop in Sitka, could easily become a full day adventure.

    I’ve done my share of sitting in Sitka/Ketch waiting to get to Juneau due to (insert reason – weather, traffic, etc)… and Juneau’s approach is similar to Fairbanks, Petersburg, and others – there’s no ILS (like you have at almost EVERY lower 48 airport) – the approach requires a visual TIGHT turn within a mile of the airport. Here’s a Wings of Alaska caravan landing @ Juneau, notice at 0:34 when the camera is aimed straight, you don’t see the runway, that’s because its off to the left. The caravan approach speed is 90 kts, an Alaska jet is going almost twice as fast, and maybe 1/2 mile from the runway you do a tight right turn…. http://www.youtube.com/watch?v=KyQI06Q7t7o

    Here’s one from inside an Alaska jet: You can see towards the end how tight that turn is, and how the wing is barely level when the plane lands http://www.youtube.com/watch?v=ruPYLwL65gc

    While I don’t agree that Alaska should have as high fares as they do, all the time, it would be nice if they had better yield management to allow some of us to fly to Seattle for under $400 roundtrip – I mean they can offer $200 roundtrip Seattle-Boston, so why not offer a few seats in the lower buckets to those of us in Alaska? that’s what we don’t see up here in the winter :(

  8. Oliver says:

    Slightly OT – why does Southwest not do red eyes?

    • CF says:

      Good question, and I don’t know the full answer. It’s a long-standing thing for Southwest. Could be crew-related, maintenance-related, or maybe just a commercial policy. Historically, Southwest hasn’t had many flights long enough to be a redeye.

  9. transconjohn says:

    Another thing to look at with this move is the economy. We fly to ANC from IAH, PDX and EWR thru SEA. With the economy being as bad as it has been I have talked to several of our passengers and noticed a significant jump in people from the lower 48 heading north for jobs. During shift change there are a lot of people trying to get home, this goes on year round. jetBlue is smart in trying to capture some of this market.

  10. JetBlue Anchorage service was wonderful for us! I am certain that it prompted AS to start “Club 49″ in which it offers 2 free checked bags to Alaskan residents when flying to/from/within Alaska, as a response to JetBlue’s first bag free policy. I enjoyed using JetBlue from Anchorage last summer on business trips to Chicago. Unfortunately, the connections through LGB are limited so I could only travel one-way with them. I hope that like USAirways(which offers Anchorage’s only year-round low fare service with a nonstop to PHX), they eventually maintain a year-round presence and expand service with a ANC-SEA-JFK service or via PDX. While we are a far-off exotic destination for many in the Lower 48, we are also one of the fastest growing Cities in the country with nearly a half a million people living in the Anchorage area, a strong year-round petroleum and shipping based economy and lots of disposable income.

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