I’m Struggling to Understand JetBlue’s Investment in JetSuite

Maybe I just need to take some LSD to become more of a visionary, but I don’t get it. I’m struggling to understand why JetBlue’s purchase of a stake in JetSuite is being hailed as a big part of its future plans for the West Coast. It just doesn’t make much sense to me.

For those not familiar, JetSuite is a private jet operator that buzzes around the West. You might remember when I took a short hop from Long Beach to Orange County on a JetSuite plane several years ago. But more recently, it launched an airline hybrid called JetSuiteX. JetSuiteX takes Embraer 135s and puts them into scheduled charter service with fewer seats on board and a private jet feel. I tried to do a media flight, but the plane broke. Then I booked another flight for myself on my own, and it was cancelled during a schedule change. So I still haven’t tried it out.

Presumably JetSuiteX is where JetBlue’s bigger interests lie since it’s closer to a commercial operation, and there’s already been cooperation there. When JetSuiteX launched, fliers could already earn TrueBlue points in JetBlue’s frequent flyer program. The founder of JetSuite, Alex Wilcox, is a former JetBlue exec, so none of this is a surprise. But can any further cooperation really be helpful enough to JetBlue to justify the investment?

It’s no secret that JetBlue is trying to figure out how it wants to serve the West Coast. It had plans to buy Virgin America, but Alaska thwarted that with a monstrous bid of its own. That leaves JetBlue with… not much. Of course it has its Long Beach focus city, but that can’t grow (not that JetBlue would likely grow it even if it could). Other than that, the West Coast is just a bunch of spokes being connected to the airline’s East Coast focus cities.

So, what does JetSuite bring to JetBlue that makes it worth the investment? Here’s how JetBlue CEO Robin Hayes put it.

JetBlue and JetSuite share a passion for delivering a high-quality customer experience at a competitive price point in underserved markets. Our investment in JetSuite makes sense as we continue to execute on our west coast plan and invest in innovative ideas that reflect the disruptive spirit of JetBlue.

Yeah, yeah, disruption, innovation, blah blah blah. But how do these pieces really fit together?

It could be about connections, but that’s hard to imagine at present. JetSuiteX has expanded and most recently announced flights from Burbank to Mammoth, a big ski resort for Southern Californians. Here’s the current route map:

JetSuiteX Route Map

As of today, San Jose, Burbank, and Las Vegas are the only cities that overlap between JetSuiteX and JetBlue. They don’t create any compelling connecting opportunities, unlike other JetBlue partner airlines. JetSuiteX’s strategy also doesn’t lend itself well to connecting partners anyway. It uses fixed base operators instead of the terminals at these airports. So while there is that possibility of doing a car service from a JetBlue aircraft to a JetSuiteX aircraft, that all seems kind of silly and expensive. It also doesn’t scale.

Another option is that this is just a way for JetBlue to be more useful to Californians who travel in general. In other words, those Californians who fly JetBlue to New York and Boston today could also think of JetBlue and their new pals at JetSuiteX when they need to do some regional flying. I’m not sure how that really benefits JetBlue all that much, especially more than the TrueBlue partnership already does today. But there could be deeper ties and marketing opportunities. It gives JetBlue the option of saying to those in North San Diego County or closer to Concord in the Bay Area: “Hey, think JetBlue and our partners from your hometown airport instead of driving to the big city.”

In a sense, that’s similar to what Southwest has said about Long Beach. If someone from Long Beach is flying to the Bay Area, people may think Southwest over the Big 3 which don’t fly there from Long Beach. But if they’re flying anyone else and have to drive to LAX, then maybe the loyalty those Long Beach flights generate will encourage them to pick Southwest over other options. JetBlue could be doing the same thing… except it has an incredibly limited number of destinations to offer West Coast travelers. That strategy doesn’t really work well. (It’s not clear that strategy will work for Southwest either, but there’s a much better chance of that.)

For these airlines to have more meaningful cooperation, JetSuiteX would have to change its model and change its route map. Maybe that’s a possibility, at least partially. After all, Long Beach has 25 open commuter slots that JetSuiteX could use. But where would those airplanes fly? Concord? Bozeman? It just seems like the markets are likely to be too thin there, even for a small regional jet. I just don’t see a whole lot of Long Beach-based opportunities. But you know, there’s that whole “disruption” thing again.

On the surface, JetSuiteX can take this money to fund expansion, something it has had on its road map already. And JetBlue can… well, I still don’t know. To me, this almost feels like JetBlue is just taking a swing in the dark, hoping to find something on the West Coast that will make it more relevant. We don’t know how much of a stake JetBlue took, so it could be so insignificant that JetBlue just thought it had nothing to lose.

You visionaries out there may see some amazing opportunity here. I’m still having trouble seeing it.

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