Breeze To Buy JetBlue, Restore Neeleman to Power

April Fools, Breeze, JetBlue

After an earlier attempt to acquire Avelo and aha! to create the super ULCC bravaha! fell through, Breeze has now moved on to a bigger prize. The airline will buy JetBlue and merge the two under the JetBlue name, returning David Neeleman as CEO of the airline from which he was booted in 2007.

The deal — which Neeleman announced wearing wire-rimmed glasses, a black turtleneck, jeans, and tennis shoes — has Breeze valuing JetBlue at $1.99 under current management, but since JetBlue shareholders won’t go for that, it offered $5.62 billion, or roughly a 20 percent premium over the airline’s current market cap. The deal will see JetBlue shareholders get a mix of cash and stock in the new company along with 10 bags of blue chips for every share owned. The new JetBlue will celebrate the acquisition with two new tailfins designed by David, meant as an homage to the previous management teams of the two separate airlines.

JetBlue first took flight in 2000 with David Neeleman at the helm. His vision culminated in a deal to secure a giant pool of slots at JFK which allowed the airline to flourish early. David’s trademark style of rapid growth, however, got him into trouble when in 2007 the airline melted down on Valentine’s Day after it kept trying to operate in a snowstorm when it should have given up. The board of directors gave David the boot soon after, replacing him with Dave Barger who had previously headed the operation.

Ever since that time, JetBlue has been a different airline with a far more conservative growth plan. It seemed clear that David always wanted to return, so his mind drifted to the fortress of solitude Brazil to plot his move. There, David founded a different blue airline called Azul which became wildly successful, but it was missing something… mostly the “Jato” behind the “Azul.” (That’s JetBlue in Portuguese, get it? GET IT?!)

While he was dreaming of his return to US soil, a cool wind blew past his Connecticut home and David thought up Breeze, an airline that would bring him back using A220s to fly longer, thin routes that other airlines realized would never work. That strategy has now been amplified with a bunch of cheap Embraer 190/195s he was able to move from Azul (and acquire elsewhere).

David has 80 A220s on order, but that is nothing compared to the 280+ airplanes he will now control when he takes over JetBlue. The expectation is that he will add another 1,000 airplanes to the orderbook since that’s a nice, round number. And he definitely won’t have any trouble finding a place to fly them. Definitely.

The first move is to realign the network and fleet strategy. The new JetBlue has already angered American by trading Southwest a bunch of LaGuardia slots so it can get back into Long Beach. (The DOJ immediately blamed American.) David then announced a plan to acquire unwanted A330s from Azul for cheap so the airline can launch flights from Salt Lake City to Brazil.

The onboard product will also see changes. JetBlue today has four primary offerings of Blue Basic, Blue, Blue Extra, and Mint. Meanwhile, Breeze has Nice, Nicer, and Nicest. The new grid will involve five product types as follows.

To ensure there is enough availability in the top cabin, the A321s will be refitted with 48 Mint seats, 30 Even More Space+ Extra seats, and 24 seats in the back. Meanwhile, the Embraers will have only 9 seats so that they can be operated under Part 135 rules. Finding enough pilots for 1,000 new airplanes will be a challenge, so this will help create a sustainable pipeline.

All of this, of course, relies upon government approval which is definitely not going to happen. But that’s ok, because none of this is going to happen, at least not today. Happy April Fools’ Day!

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21 comments on “Breeze To Buy JetBlue, Restore Neeleman to Power

  1. Bravo Brett! As soon as I saw the first part of the subject line on my phone, “Breeze To Buy JetBlue…”, I knew April Fools’ Day was upon us. And you did not disappoint.

    The fare chart was awesome: Not So Nice, Nice, Nice+, Nice+ Extra, Nice+ Minty Fresh had me laughing out loud. It’s like something they’d teach at Stanford Business School or MIT Sloan. Just what I needed before heading off to sleep.

    If your kids have your sense of humor, I’d keep your eyes peeled today. They may prank you today. :-)

    1. The fact that the first tag in the post is April Fool sort of gives it away prematurely though. I’d suggest removing that tag until tomorrow!

  2. Analysts from major Wall Steet investors lowered their target price of $UAL after the global airline failed to even be hinted by the latest breaking news report by the industrial leading reporter CF. Shareholders expressed their concern the airline is failing out of the gossip chain.
    The Seattle based $ALK had mixed feelings after they found out analysts ignored their omission from the same report.

  3. I like the single-fingered livery. A true reflection on how many airlines seem to view their customers. You know, the people who pay their salaries.

  4. Here in the Middle Atlantic, March went out like a roaring lion, clearing the way for Cranky April 1.

    “Cranky Flier LLC,” the LLC we now know stands for “Laughing Like Crazy!”

  5. Well, that was O.K., Cranky, but I think that the best April Fool’s jokes are the ones that “have ’em going” at first, sounding (or reading) very plausible before you drop the punch line on them. The one that you posted three years ago did exactly that! It requires a bit more creativity, and you are definitely capable of that!! Happy April Fool’s Day and keep up the good work!

  6. Just acquire Mesa for their 200 Heart Aerospace 19-seaters, and Cape Air for their Tecnam P2012s and Grey Gull pilots. Voila; 1000-aircraft fleet and no pilot shortage.

  7. Brett, I was busy for most of the day but when it comes to April 1st, I always think of you and CF. When I was finally able to, I checked your blog first. You have always put out the best pranks and this one was no exception. The ‘Not so Nice’ was the best. Brought a smile and chuckle to my day. Thanks.

  8. In November 1994 Guy Kawasaki wrote a humorous article for MacWorld that announce a headline:
    “Steve Jobs to Return as Apple CEO?The Father of Macintosh brings back the vision. Spindler is COO.”
    The text of the article is one of the most humorous ever written in technology because of how accurate it ended up becoming years before it was ever thought possible.

    Cranky you may have written an airline equivalent.
    Awesome job?.

  9. I’m a bit disappointed. I figured you’d have Neelman buy up both JetBlue and American – not to mention ITA that’s the subject of privatization talks.

      1. @Mirza – One article I read says that Delta isn’t interested, but other sources report that it is. I tend to think Delta’s interested. I’ve also read that Air France and KLM have shown an interest, both on a stand-alone basis and with Delta. And I read that Lufthansa and shipping conglomerate MSC Group have jointly expressed interest.

        My only question is if ITA becomes privately owned, will it get its act together? And if it does, where will the title of “World Worst Airline” go?

  10. Always enjoy the annual installment of this series and this was no disappointment! A Cranky tradition!

    1. Forgot to mention how much I liked the nicest plus minty fresh fare class. My very own Embraer? Awesome! Lots of DCA-GNV nonstops il coming this fall!

  11. I saw the new Condor livery and thought for a minute it was a Cranky April Fool post, but no! It’s real.

  12. So now Breeze, eg, JetBlue wants to acquire Spirit. Crazy world. Looking forward to your take on this.

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