JetBlue CEO Robin Hayes recently announced that he would step down on February 12 after a nearly 9 year run. His long-time lieutenant Joanna Geraghty will take the reins, and oh boy, does she have a big job ahead of her.
Robin’s tenure can really be broken into two halfs. Between 2015 when he took over as CEO and the pandemic, JetBlue seemed more focused on controlling its own destiny and growing organically. The airline was building its Boston and Fort Lauderdale operations. Then the pandemic hit, and the airline changed. Or maybe it wasn’t the pandemic when it happened; maybe it was when CCO Marty St George left in June 2019. Whatever it was, around that time, JetBlue’s eye started wandering.
During the pandemic, the airline focused more on short-term opportunity instead of long-term strategy as other airlines like Delta and Southwest did. The experiments in Miami, Newark, Philly, and Raleigh/Durham amounted to nothing and were discarded just as quickly as they started.
The already-lagging operation got even worse. Just look.
JetBlue Operational Performance by Month
Meanwhile, the airline’s culture continued to erode from those heady early days. Under Robin’s leadership post-pandemic, JetBlue took three big swings, but it ended up striking out. The JetBlue of today is in a worse place than it was 5 years ago.
Strike 1 – Europe
While Rome burns, JetBlue has literally tried to get closer to Rome with its burgeoning European operation which started in 2021. The problem is that this is a vanity project. with limited return. It requires a separate subfleet of the A321neo — actually an A321LR — that has only 138 seats onboard. Compare that to SAS with 157, TAP Air Portugal with 171, and Aer Lingus with 184 on the same exact airplane. This is a very premium-heavy product that works if they can fill all those premium seats. But how will that happen?
You can probably make London work on an airplane like this, but then what? Maybe Paris? Oh sure, during the summer those frilly flights to Dublin and Edinburgh work, so does almost anything. But it’s a long cold winter with limited places to put those airplanes.
And these airplanes aren’t just a different subfleet in terms of configuration. They have hot ovens unlike the rest of the fleet. [Correction: the rest of the fleet has hot ovens but only for Mint, not in coach like the LRs] It’s a whole different service flow. This is a significant investment for a small potential return. It’s a distraction, but this is more like a foul ball. JetBlue took a swing and made contact, but a foul ball still counts as a first strike.
Strike 2 – The Northeast Alliance (NEA) with American
Robin’s best swing was on a fastball right down the middle. On the surface, the NEA was a fantastic plan. JetBlue and American had both been looking to improve their positions in New York. American needed to improve its position in Boston. The partnership would have vaulted them into a competitive position in both markets. But it all went wrong.
American was bleeding in New York, so the first thing it did was turn over a ton of slots at LaGuardia and some at JFK to JetBlue to fly. JetBlue couldn’t digest this quickly, but it was all hands on deck. The airline essentially gave up on restoring Boston and Fort Lauderdale post-pandemic so it could put all its chips into New York.
JetBlue Flights By Top Cities
This was a strategic, long-term investment, but it meant that JetBlue took its eye off the ball in important markets, especially in Boston where Delta was hungrily growing its presence.
JetBlue Percent of Delta in Boston Domestic Market
Delta had been building up in Boston, and slowly cut into JetBlueʻs position up through 2019. After that, JetBlue fell of a cliff in comparison. Now in 2023, Delta actually passed JetBlue in number of seats offered (when you include joint venture partners) and number of local passengers for the first time. This was JetBlue’s one true opportunity to dominate in an important city, and it lost it so that it could be a stronger number three in New York.
What’s even worse is that JetBlue didn’t just direct its resources to New York, but it had to change its fleet plans to do so. The Embraer 190s were probably one of the worst purchases made by the airline long before Robin’s tenure, but there has been much waffling on retiring those airplanes. JetBlue made various decisions to extend retirements and leave complexity and expense in the operation. There are still about 50 flying today with their demise coming sooner rather than later, finally.
As we all know, the NEA ended in failure when the judge blocked the partnership. But instead of continuing to fight with an appeal or an altered agreement for something that at least made real strategic sense, JetBlue abandoned the plan in favor of strike 3.
Strike 3 – The Spirit Acquisition
JetBlue under Robin — and probably before that, really — has had a Napoleon complex. It wanted desperately to be bigger regardless of the strategic value of that growth. When Frontier announced it would merge with Spirit, JetBlue completely freaked out. It decided to pour money into a hostile bid of its own for Spirit. It got so desperate in the process that it agreed to a monumental $470 million reverse breakup fee, much of which it prepaid to the Spirit shareholders.
The rationale was basically that JetBlue needed more pilots and airplanes, and it couldn’t get them quickly enough on its own. In the context of the NEA, you can see how it might have felt that way. But the Spirit acquisition was at the opposite end of the spectrum from the NEA, and in the end, it hurt the NEA’s chances of working.
With Spirit, JetBlue was going to inherit moderate positions in a whole lot of cities around the US. These positions weren’t big enough to give JetBlue any sort of dominance. Spirit’s whole goal of winning on low fares would have been thrown out the window in favor of a JetBlue premium-ish product that the airline felt would give it more relevance in competing with the big three.
I never liked this plan, but JetBlue signed an agreement in blood that it would defend it to the death. When the NEA was blocked, JetBlue just abandoned that and put all of its effort into getting the Spirit merger approved.
The thing is, with the NEA gone and all those NYC slots going back to American, why did JetBlue even need more airplanes and pilots?
As we all know, the judge in this case blocked the merger last week, so now JetBlue’s entire plan has crumbled. It is appealing, but it had to do that. It promised Spirit it would fight to the death, and so it will. But the chances of winning on appeal are slim.
Now that JetBlue has struck out, it has little to show for its efforts over the last few years except for a few fancy airplanes flying across the Pond.
On top of these big strikes, there have been other problems along the way showing just how bad JetBlue is at… doing things. I know that sounds odd, but here are three good examples of what I mean.
A320 Reconfiguration – Slow to Execute
The airline made the decision to increase capacity on the A320s from 150 to 165 (later reduced to 162) back in 2014. It took years for the first one to even be done, and the work wasn’t completed until 2022. Even then, there were 11 aircraft that wouldn’t be fixed due to retirement by 2025. So a much-needed move to add seats and reduce unit costs will take more than 10 years to truly finish.
The LA Basin Disaster – Unwilling to Take Action
JetBlue should have left its Long Beach focus city years ago, but when it made the move in 2020, it never should have moved the operation to LAX. The airline has not figured out how to make LAX work at all, outside of the core flying as a spoke from the airline’s northeast and Florida focus cities. There is no value in being a clear number five in a market when you have little opportunity to get ahead, but the airline continues to waffle and waste resources in a place where it will not succeed. If it really needs airplanes and pilots, this is a great place to find them.
Blue Basic – Poor Implementation
In November 2019, JetBlue rolled out its Blue Basic basic economy fare. This highly restrictive basic economy fare eventually was tweaked to not even allow a carry-on bag. For an airline that had developed a premium reputation, this did not fit. The fare difference between Blue Basic and the regular fare has often been rather large, a startling difference from what most airlines have done. I have no idea how it is able to remain competitive with Delta in the northeast with this uncompetitive fare product.
When you add it all up, you have an airline that did try to take a couple of swings, but other than the NEA, maybe it shouldn’t have. And now, Robin leaves the airline having failed on two of his three big efforts.
What lies ahead of new CEO Joanna is highly dependent upon the ultimate outcome of the merger. If there is a successful appeal and the purchase is allowed to go through, she will have no choice but to spend her early years in the job trying to digest Spirit. It’s a long, tedious task that will do nothing to actually strengthen the airline’s strategic positioning. It will just make the airline bigger. After all, the biggest strategic benefit would be the addition of scarce resources in New York and Fort Lauderdale, and it has already agreed to shed those if the merger happens.
If the acquisition fails in the end — as seems highly likely since appeals rarely win — then it gets interesting. This is probably the best possible outcome for a JetBlue CEO with a clear strategic vision. Joanna would inherit an airline that’s shockingly not all that different compared to what Robin inherited nearly a decade ago. But Joanna could build a team to finally regain focus, create a sensible strategic plan, and rebuild the culture that has been on a steady decline for years.
Robin’s tenure at the helm of JetBlue will be one remembered for high profile legal failures while ceding ground in the airline’s strongest markets. Let’s hope the next regime can do something more for JetBlue.
105 comments on “Departing JetBlue CEO Robin Hayes Has Little to Show for His Nine Years at the Helm”
JetBlue is headed for bankruptcy and eventually, will see its assets carved up and sold in chunks to a few airlines. While it has a bit of a brand halo thanks to the illusion of a service ethos that is a cut above the competition, it runs a terrible operation, from a reliability perspective, and always has (does anyone remember the 2007 Northeast Snowstorm debacle?). JetBlue is unreliable and likely doesn’t have the technology platform to apply operational frameworks that have helped AA, UA, and DL improve their dispatch reliability and reduce delays, including in periods of bad weather.
The carve out of Jet Blue will see JFK assets picked off by American Airlines. Boston will be split between American and Delta. Fort Lauderdale will likely go to NK and F9 and the rest, across the legacy US carriers.
NK is likely to enter bankruptcy before JetBlue, if JB ever does. Financially, JB has been doing better than Spirit. Spirit is in trouble after this merger was rejected.
If you’re going to go back to 2007, go back even further to the northeast blackout of 2003. Most airlines CXed everything – JetBlue, as I recall, launched all but two of its flights that night.
So it wasn’t always operationally incompetent. But neither 2003 nor 2007 is all that relevant.
Hayes was enamored of grand strategic visions rather than bearing down on the day-to-day operational and competitive issues that, over a nine year time frame, can really make a difference. Concentrating on those nuts-and-bolts details doesn’t make you as interesting at parties, but it’s what gets the job done.
Reminds me of United under Tilton. All about the strategy, desperately wanted to get bought to give him yet another payday, meanwhile the experience of flying United was just terrible. The airline was visibly awful (the state of the aircraft, for one thing).
I wonder if anything important changed after 2007?
LOL….queue the demise of JetBlue as expected repeated since 2001. Clearly a troll with fanboy allegiance to your legacy guys.
They will be just fine. They just need to strategize their strengths. I agree with lots of cranky post except for Europe. They are gaining revenue at a high rate and it’s doing well and mint is selling like gangbusters. Cranky you even posted a few years ago that jfk and Boston make more sense with European service. I think they need to eventually upgauge to wide body and engage long haul that way.
As a largely BOS-based traveler (along with other nearby airports) who doesn’t participate in FF programs, that 3rd graph was a surprise to me; I didn’t realize that JetBlue had that much more capacity in the BOS market compared to Delta. For my travel, they just usually aren’t very competitive, and the fact that DL and even AA handle IRROPS much better than B6 means that if prices/schedule/etc are similar, I tend to “book away” from B6.
I’m glad to see the “Blue Basic” basic economy rules called out. Anecdotal example: I do 2 or 3 roundtrips a year from BOS area to FL (usually TPA/SRQ area, which isn’t B6’s core FLL/MIA area, but still part of B6’s “bread and butter” flights from the Northeast to Florida), almost always with a personal item + carryon rollerboard bag. I tend to be pretty price sensitive, but in the past 5 years I think I’ve flown B6 for one of those roundtrips, DL for the majority of them, and others for the rest, largely because B6’s basic economy fares usually aren’t very competitive once the cost of a carryon bag is added in.
Finally someone called out Blue Basic. As an airline that used to offer free checked bags, their Blue Basic fare is more restrictive than DL, UA, and AA. For price sensitive customers, they would rather fly the big 3 airlines that offer more for the same price, sometimes less.
I’ve always wondered if they would have more success building out a larger operation mid-continent such as AUS that would give them enough premium-ish travelers and allow better connections from other cities in “fly-over” country. Also, it does seem to me that this is an airline without a vision or clear direction. I also wonder where they would be right now if David Neeleman would have been able to stay.
I’m not sure why people keep bringing up this warmed-over argument that JetBlue needs to grow mid-con, eepecially AUS. They do not have the infrastructure or brand awareness to make what you’re suggesting work
Plus AUS is too gate-constrained to be a viable hub, and the city government and voters have no intention of growing it enough to make it viable.
when the e190 came in, JetBlue tried making AUS a focus city. It was supposed to be the logical stopover for the 190 to transit east-west. And it was a perfect time, the city of Austin was growing, but not where it is today. JetBlue sponsored UT and threw a bunch of money and capacity. And it failed. Planes were empty. The biggest challenge for JetBlue is that unless you are going to a big city, they don’t have much of a network. But then to the big cities, the legacies often have more frequencies and better reliability.
AUS is a totally different city these days, DL and AA have both focused on it, but the population has grown significantly.
The real question is what value does AUS bring? Or any mid-continent hub? Hubs only matter if you can create and flow connections. Adding a hub to still fly to LAX/MCO/FLL/JFK/BOS doesn’t really do much to warrant being a “hub” vs figuring out where it can be a profitable spoke.
They really didn?t try to make AUS a focus city. It was more of a scissor hub between Florida and the West. Other than JFK and BOS which were served first, they didn?t add anything until mid-2008 when they did LGB/SFO/MCO/FLL. That?s when it was Embraer 190. Those routes are terrible for the E90, too long to make any money on them. In 2010 they upgauged to A320s on and off. SFO ended in 2014 while the rest made it to the pandemic. During the pandemic, they tried CUN/EWR/RDU, moved LGB to LAX, and tried SFO again. Those were all gone by summer 2022. It?s now just BOS/JFK and FLL.
While I agree with some of what you’re saying in this post, overall, I think they will be fine. Jetblue does need to figure out a plan and how to become profitable, but their biggest problem is their reliance on JFK/BOS. As their main base of operation, JFK is a disaster due to delays, weather, ATC shortages, and the fact that almost every flight has to go through there. I certainly do not see doom and gloom for them, but there needs to be some soul-searching, and that needs to start with figuring out how to diversify outside of the Northeast. What does having their eggs in the Northeast basket ultimately do for them… Absolutely nothing.
Regarding Europe, you’re missing one key fact: their CBAs with the unions heavily restrict what they can and can’t do with partners, and the unions 100% will not give up relief on scope. That won’t happen, so feeding their partner airlines is pretty much a non-starter from the get-go.
I also agree that LAX as a focus city needs to be reconsidered, but they have stated that they need a focus city somewhere out west; where that is, who knows, but I certainly can’t see them abandoning the western part of the US.
I ask you, if you were them, what would you do? I always like to ask people, when I see them call out things, what their opinion is, what should be done?
Concentrate on the basics. Fix reliability. It’s no use saying “it’s JFK, can’t fix it” – a huge amount of the value proposition is getting people there on time with their bag. If you can’t do that, you’ve basically lost the battle.
Weirdly, JFK total operations (all activity, not just air carriers or JetBlue) seem to have already recovered. Boston, for instance, is still down materially on 2019. So perhaps Boston operations are currently easier than JFK. So maybe consider isolating JFK in the JetBlue system so whatever happens doesn’t bleed into other activity. You need to follow your the logic of “make JFK operationally tolerable” wherever it takes you.
Again, you need to be able to get people where you said you would, safely, on time, with their bag. If you can’t do that, then all the great marketing, on-board frippery, etc – won’t save you.
AvGeek101 – Without having internal information, I certainly can’t tell you exactly what should be done. But based on the information I have, I’d first invest in creating a functioning operation. That does mean adding cost back into the operation in the near term, but it’s an important investment. Create more buffer, add more spares, possibly isolate JFK into a closed network. Something needs to be done to right the ship.
Then I’d see if I could still have a chance at winning Boston. That ship may have sailed, but it’s still the best opportunity for JetBlue to have a winning position.
I’d shut down LA right away, keeping it as a spoke of course, from other focus cities. There’s no reason to waste resources there. It’ll be costly because it means closing the LA crew base, but so be it.
Once that work is done, that’s when I’d start looking for more expansion opportunities. There were plenty of places in the past that could have made sense, but places like Austin don’t make sense anymore. The ones that I find most interesting are San Antonio and Portland (OR). But times change and opportunities change, so you never know what will make sense down the line.
This doesn’t even really address the deep investment they need to do to repair the culture.
PDX is one of the most underserved airports in the country and its leisure demand would fit nicely with B6’s strategy. There’s plenty of unmet demand to places like PHX, LAS, PVR, SJD, CUN a
Serious question: What does JetBlue “winning Boston” or “dominating” in Boston mean?
Does it mean being #1 in terms of seats, flights, and/or destinations, at the potential risk of sacrificing some profits for market share? Does it mean trying to use muscle (and being willing to take short-term hits to profitability) to really brawl with AA and DL in an attempt turn BOS into closer to a fortress hub for JetBlue a few years from now (if that’s even possible)? Or does it mean finding a way to sustainable profitability out of BOS, even if that’s a smaller niche and means that B6 is the #2 or #3 carrier?
I’m not trying to argue (and I’m inclined to agree that JetBlue needs to do something different with BOS, perhaps something drastically different), just trying to clarify how you and other people would define “success” for JetBlue in Boston.
Sustainably profitable. It’s the only meaningful standard.
What other criteria could there be?
Kilroy – It’s really about commanding the market to the point that you can lead on pricing (meaning, you can charge what you want, not that you have to lead with a low price) and you offer the most utility to the local travelers. JetBlue has seen that slip away rather quickly since the end of the pandemic as Delta invested in building Boston up. I find it very interesting to look at both Boston and Seattle in this context. Alaska has held its own in Seattle. It has added routes, maintained its position, and has a very successful hub. (It’s Delta’s worst hub by far.) The situation is flipped in Boston.
JetBlue’s challenge is in thinking seats is the right metric. When you have 20+ dailies to Florida, that matters for scale and maybe some pricing power in those markets, but it isn’t the same as Delta flying RJs to 2x the destinations where they become more attractive to a business customer.
This is where I have a big problem with the judge that blocked the spirit merger. It was sold as saving the public from an anti-competitive merger…but it could easily win up hurting worse if both JetBlue and Spirit fail.
Again just, in my mind, a critical lack of understanding of the industry by the judge.
I agree 100%. This decision does nothing to protect the consumer; it does the opposite. The bigger airlines will continue to grow and flood the smaller airlines out of the market, or at the very least, knee-cap them even more until they can’t exist. We are already seeing now with the legacies. They are adding fare options to match the ULCCs and putting a dire strain on that business model.
There needs to be a larger LCC that can combat them, and it’s up to the free market to determine that; I think so, anyway. But, oh well. As Regan said, when you hear “I’m the government, and I’m here to help,” run the other way.
The judge should have permitted it as a matter of law, but if it goes forward, they’ll almost certainly end up in Ch 11. Hard to think of a dumber merger in this business. Maybe have to go back all the way to Texas Air merging Continental with the remains of People Express, Frontier and NY Air.
If B6 hits Ch 11 without the merger, it would have simply happened even faster with the merger.
And Spirit’s in trouble bc they’ve been asleep at the switch, in part because they’ve been focused on merging with either B6 or F9.
There are a lot of airline execs who would far rather think grand strategic thoughts than bear down on the gritty day-to-day of running a great airline.
John G – Did you read the ruling? It is not a misunderstanding. Using the failing firm argument, this doesn’t meet the criteria. Spirit kept crowing about how it has a plan to return to profitability, and as the judge notes, it would only work anyway if there were no other potential buyers.
I did read it. I also think it’s terrible law, and a poor interpretation of it.
The whole point of the law was to prevent trusts from controlling all of a given business, stifling competition. But by applying it to smaller companies like JetBlue and Spirit, they are basically protecting the exact larger companies the law was supposed to address.
Is there a reason they could not make OAK work, and have a large west coast presence?
Or is it that no one wants to fight with Southwest?
they probably don’t want to fight with WN in that territory. They know Southwest would easily win. More planes, more money, more staff.
So, no one says “Alaska isn’t successful because they have no big east coast presence”. Why does JetBlue need to have a big west coast presence? Why is that a criterion at all?
I think Alaska has enough of a West coast presence up and down the coast, in a more diversified markets to make east-west flights work okay (not great), where as JetBlue is more concentrated in a few nodes out east and is better suited to leisure based north-south flying.
NoOne Flys Oak – Tried that once and ran away. It’s really not a place that works outside of being a spoke or if you’re Southwest.
Wjen they read that, there goes your sponsor deal Brett!
John G – I’ve never let a sponsor dictate what I write, and that isn’t changing now. That’s not to say that additional routes into Oakland don’t work, but the airport as a focus city/hub for another airline? No way.
Genuinely curious question: why doesn’t it work? Is it because business travel is concentrated around SFO+SJC?
XO – It’s a great question, and I don’t have a good answer. The population is large in the East Bay, and it’s a pretty easy ride on public transit from San Francisco too. But Oakland hasn’t really worked for other airlines. There’s room for one big operator in Southwest, but nobody else has been able to make much work at all. I’m not entirely clear why.
Revisionist history but JetBlue should have bought Virgin America. Virgin was purchased for $2.6 billion and JetBlue agreed to $3.8 billion for Spirit.
I think VX had something like 60 aircraft, Spirit 220. If it’s about acquiring routes/gates, aircraft and pilots, that seems to be a reasonable proxy for the relative size of the airlines.
B6 started down this road to nowhere by failing to acquire Virgin America. West Coast presence? Check. Fleet commonality? Check. Decreased reliance in NE? Check. Clearly it made too much sense. They’ve been tilting at windmills ever since.
And that’s why Alaska went out and outbid Jet Blue for Virgin America. However, I’m not sure that B6 buying VX would have turned out better for B6. AS shrank their presence in LAX and SFO and I’m sure B6 would have had to do the same thing.
The best image to describe VX was the Brett’s image showing the airplane engine shredding money.
When Robin replaced Dave Barger, the emphasis of the company went from keeping the passengers and crew happy to making the investors happy. It was very noticeable.
Any chance the government will drop it’s opposition should the Rs win in November?
LGA CM – That is a really interesting thought. The judge stopped short of banning the merger outright going forward, saying that future attempts could be made with a different structure. If it were to be proposed again and went to court, then it would probably fail to gain approval now that precedent has been set. But if the government decided not to oppose it, then the courts wouldn’t be involved. So yes, it’s entirely possible that could happen. Look for large donations to Trump from JetBlue and Spirit..
;)
Could JetBlue simply change their mind and state this:
“We understand your ruling. We now propose to keep Spirit running as basically a carrier-within-a-carrier. We will of course want to swap planes and crews based upon how+whereever it is most profitable to fly; but, not every Spirit route today is a winner, and if merged, we can more efficiently allocate our combined resources (crews/planes/etc) between our two brands to both compete with the big-boys while also still serving the needs of the starving college kid.”
….And then, over the next 5ish years, Spirit basically becomes a niche airline with a fleet of like 10 aircraft.
Outer Space Guy – They can try whatever they want, but the government will object to it under this administration. So the question becomes whether or not it could be different enough that it would change the outcome of the judicial review. I tend to think it would not be looked on kindly if they did something like this since it’s obvious what the end game would be.
Minor point of fact but B6 is using the A321neo’s with 16 biz seats and 144 economy for their Dublin and Edinburgh flights, at least that was the plan when they announced it https://news.jetblue.com/latest-news/press-release-details/2023/A-Celtic-Combo-JetBlue-Announces-Seasonal-Flights-to-Dublin-and-Edinburgh-on-Sale-Today/default.aspx
I agree with most of what you said except for the Europe complexity. Ovens on a small subfleet only is not ideal but since they use nearly the same plane as the rest of their fleet, I don’t think it adds all that much complexity. If they are picky about which markets they flight to, I think Europe will be a winner and outweigh the higher costs in the end. The biggest success B6 has had the past decade or so (and pre-dates Robin) is the Mint seats and European routes are an extension of that product as they have run out of domestic Mint route opportunities.
Zack – Oh good catch, thanks for the correction on the neo not LR operating EDI and DUB. But you talk about being picky about which markets they fly to… what makes sense, especially through the long cold winter? Not much in my opinion.
I think this is a good start for Europe. Mint is doing very good for them. I see mint to London and Amsterdam Paris constantly full. That’s where they make the money. Long term of Europe i think they need bigger vision, they need to join a alliance or a serious JV ala northwest/klm and get widebodies to feed the other end and make places like Athens, Warsaw, prauge, etc that cannot be met with LR’/XLR’s. In winter they can do what the others do, consolidate routes, they don’t need to fly 7-8x A320’s to puerto Rico, Dominican Republic in winter, they consolidate to 3-4 flights but remain ASM’s with upgauge and open up new slots in jfk. Also Take those widebodies and point them south where in the winter there is high demand. Aruba, Barbados, Cancún, mintego bay, Kingston etc, and even down to Brazil Argentina chile, would work when demand goes down in Europe. Heck Hawaiian from nyc is an option. Getting widebodies would be a much less costly venture than merging spirit, if they were willing to go with a costly merger, now that it’s likely not happening, take that money and invest in ops and expanding the fleet.
Full flights don’t necessarily mean profitable flights. I don’t have insight into the market performance, but just saying. Saying they don’t need to fly 7-8 flights to PR and DR shows a lack of understanding of B6’s network. They’ve flown 10+ in those markets and were all full and printing money; that is the best place to pour capacity into, especially in the winter. AUA and CUN absorb WB capacity, but DR and PR are where the gold is buried.
bingo, when you can fill a plane profitably to SDQ at 4 am….you don’t cut flights, you add. And given it is half the time of Europe and half the taxes, and doesn’t require a sub-fleet, the DR may not be “sexy” but it does make more sense financially.
Your point out of Mint service was overlooked by CF in his three-strike assessment of Hayes’ tenure. This is perhaps the one counter (base-hit)to his baseball analogy. Mint was advanced & mainstreamed by Hayes, as one of his first actions as CEO. Historically, Mint has been a reliable profit center for B6’s transcon domestic operations and led to spring boarding the JFK-LHR expansion. According to my own internal awareness, B6’s European operations is net profitable at present. These points aside, CF has his finger on the pulse wrt JetBlue’s current status and future outlook. I would only add that the upcoming POTUS election could have a positive impact for B6, should the business cycle improvements, resulting from a Trump win, generate a beneficial tailwind for the airline industry, at large, and specifically for B6 over the next 24-36 months.
SeniorBlue – JetBlue announced Mint in September 2013, before Robin was even boosted to president. He didn’t become CEO until 2015.
As for Trump, I’m not sure what kind of business cycle improvement you’d expect. Things are humming along very well right now. The only real change that a Trump presidency would bring is the potential to push a merger attempt through again without a government challenge.
Good piece and thanks for writing it. As a former JetBlue regular, I’m still amazed at their fall from grace over the past decade in terms of product, strategy, operations, pricing, etc… all of it. Its just remarkable.
One thing I’ve always thought was worth questioning: I don’t think it was a good strategic decision to pursue the NEA in the first place. Back when the US-AA merger was happening, I actually bought up a bunch of JetBlue stock because I figured AA had a bad product, little brand loyalty among north-south US east coast flyers, and a rough merger ahead of them. There was a huge opportunity for JetBlue to just out compete them with a better product/pricing, and become the dominant airline on most northeast-southeast routes that had been big for US. I always thought it was odd that JetBlue essentially went the other way and tried to hold hands with AA instead of win a fight.
I think that decision deserves a lot more scrutiny in hindsight. You could say its basically where they stopped being a disruptor and started the path toward awkward undefined little brother of the big 3.
Sam – I liked the NEA personally because you just can’t grow on your own.
You can try to “beat” AA in New York, but they aren’t going to relinquish their slots. So, if you can’t beat ’em, join ’em. What I really don’t like is doing it half-assed where you kind of dip a toe in and then also try to buy Spirit. Those are two totally different strategies.
Remember B6 arrogantly claiming both would stand up to DOJ scrutiny? Turns out, B6 management is 0/2 on predictions.
To be clear, one of the reasons you bought JBLU back in the day was because you thought a merged company with hubs in NYC, PHL, Dca, clt, and Miami didn’t have much brand loyalty on the east coast? Huh?
When the Spirit/B6 merger attempt fails, will B6 go back to AA to try to revamp the NEA with something that will pass muster?
WSM – The judge’s decision barred them from entering a similar arrangement for 10 years. So they really can’t.
Don’t forget the real strike 1: failing on the VX merger, and then downplaying the failure as an “opportunity for organic growth” (Props to the B6 PR team for constantly having to spin chicken s*** into chicken salad). JetBlue’s only true opportunity to build a national network
In retrospect would Jetblue have been smart to counter the Alaska bid to acquire Virgin America. Alaska seems to have not grown because of it. At the time a combo of gate and terminal access in BOS JFK SFO LAX would have been a great basis for growth.
They did but AS countered with a higher bid that B6 either couldn’t or wouldn’t top. If I remember correctly AS had lower debt to capitalization ratio so the could afford to that on more debt. They were also determined to keep B6 off the west coast at pretty much any price.
Why is an Aeroflot tag being used in this post?
DaBluBoi – Looks like I accidentally clicked it. It’s removed.
Saw that the ONT-JFK flight was just axed, Jetblue completely failed in the LA basin. At time things starting going south at LGB there was a real opportunity to relocate to BUR or something.
They held on in LGB going to get the CIS facility which never happened. Not sure whether that would have been a silver bullet for them in the LA basin but it definitely contributed to clinging to LGB for way too long.
BUR during the pandemic was potentially open, because it was first come first serve. So, had B6 wanted to move all that flying to BUR and operate empty-ish aircraft for a while (remembering that CA didn’t really recover until 2023) then, in theory, maybe. Limited facilities and all.
But BUR, as a base, has a problem – it’s got a curfew. You can’t fly in/out from 10pm to 7am the next day. So it’s operationally hard, especially if you’ve got really crappy reliability at your east coast bases, as does B6. Oh, dang, this flight from JFK won’t get to BUR by 10pm – gotta scrub it or divert to wherever.
Avelo was attracted to BUR and it’s been operationally hard for them. Can’t flex your schedules up on super-peak days. People will fly at midnight the Sunday after Thanksgiving. But they can’t do that at BUR. BUR looks attractive, but it’s not quite what it seems.
Bigger question is why have a west coast base at all?
ONT and SMF will become seasonal Jetblue cities.
I am the minority who enjoys flying B6 and has been lucky enough to not experience any of their operation issues. Now that I said this, I am not looking forward to my next flight to be on time.
Regarding europe subfleet, they had the issue when they joined the transcon party with their mint A320s. I think they rotate those planes to the Caribbeans during the weekend. Can they do something like that with the european subfleet in the winter?
I am certainly not a fan of Blue Basic and avoid booking that. Between Blue and Blue Extra or whatever that is called, I found that the Blue Extra of flights with less desirable departure time can be cheaper than the Blue of the same day. I would book the Blue Extra and roll my dice to do a same day flight change (free with Blue Extra) to my desired time on the day of departure. This worked pretty well for me.
B6 is a mixed bag of premium and low cost. I enjoyed having seat back TV, door to door WiFi on most flights, and relatively generous seat pitch. It is aslo fun to see the names they have for each jet and various tail design.
At the same time, I don’t like them made the travel fund not available for points booking online. They only do one round of drink service in coach even on a transoon which seems a bit crazy to me. Most importantly, they stopped serving blue chips!
bring black blue chips and unlimited drinks!
Wany – They could certainly send the European aircraft to Florida and the Caribbean during the winter, but those airplanes would lose a ton of money. They only have 138 seats onboard with a heavy emphasis on premium cabins. Those Mint seats take up about 3.5 economy seats, and I don’t think there’s enough revenue to cover that cost on such a short flight during the day.
Thankfully the ability to use TravelBank with awards was finally added back a couple of months ago, but only if you have enough Travelbank to cover all the taxes, you can’t combine it with a CC.
The amount of time this cost the CS reps most have been crazy, especially as you can’t change an award, just cancel and rebook.
Perhaps B6s lack of mid continent presence could be a NEA 2.0 type arraignment with AA focused on ORD. AA has hacked ORD medium/long haul back to key business markets but maintains a sizeable regional footprint with Eagle. Let B6 pick up non MIA Florida flying and leisure heavy markets in the West, Northeast and sun destinations.
Using connectivity from Eagle from markets B6 will never serve like CID, DAY, SDF,MSN, etc. can help put butts in seats and give AA some mass in the Chicagoland market.
Now let’s see what kind of fit APA would throw. Their choice of having a dwindling hub with eventual job losses or a hybrid hub with not much growth but no losses.
As for their ambitions in the West I’m afraid that ship has sailed. At best, maintain a boutique high quality product to the hubs and knock off the P2P stuff.
Why hasn’t Jetblue succeded in LA? It seems like there’s real potential there for them to build up a half decent west-coast network. If they did it well couldn’t they someday launch Hawai’i routes to complement their new European adventure?
No airline is successful at LAX. They’re all losing money.
Why does EVERYBODY claim that EVERY airline is losing money at LAX?
I recall it has biggest O/D market in the world, so demand doesn’t seem to be the issue.
I don’t recall it being airport infrastructure (gate, slot) constrained either:
4 runways, typically 2=landing and 2=take-off
24 hour operation
No weather issues
Willing to build new terminals (gates) when necessary
So is the problem that EVERY airline can’t make ANY money when there isn’t an airport infrastructure constraints???
I believe the old adage is “ANYBODY can make money when there is a shortage!”
WN took over at LGB and used up ALL the slots and raised the fares to be SNA-like rather than LAX-like.
Is this the basic equation of success: “Use up all the infrastructure and count on NIMBY’s to prevent expansion!”
What other large O/D airports are not infrastructure (slot, gate) constrained across West Coast, Center, and East Coast?
The primary reason is lack of real estate. B6 and NK are both essentially sub tenants of AA in T5. That doesn’t give them space to run the North/South schedule they need to make a dent in a market covered by UA,WN, AS. I think they might be banished to MSC South if AA wants to bring the RJs into T5.
SlothBoy – LA is a very difficult market, because the airport won’t let anyone really take a commanding lead by design. So you have several airlines fighting each other for prominence since there is important business to be had. The airlines take turns beating each other over the head and then they switch places. Right now, Delta is making the biggest run, and it’s doing well. American backed off mightily during the pandemic. United has been trying to grow but it is hamstrung by lack of gate space. You have Southwest which hasn’t returned to LAX as quickly as it did elsewhere after the pandemic, but it has its own terminal and there are plans to build another concourse which will allow for future growth.
And then there’s Alaska which is really the number 5 in the market, but it is sort of aligned with American. That’s where JetBlue comes in, and there’s just not much room for the airline. In the short-haul intrawest markets, it just doesn’t have and can’t support the frequency the other players have to attract the most business. Even in markets like Cabo and Puerto Vallarta, it is such a minor player that it gets the leftovers. It tried some of those secondary east coast markets, but those haven’t lasted very long. And it really has no local presence in the Midwest, so it’s really hard to make a market like that work when you don’t have anything helping you on either end.
As a west coaster, I have never set foot on a B6 aircraft… today I would have to drive 100+ miles to get to an airport they serve.
But I have some 8000 miles (points?) in a B6 “loyalty” account that I earned years ago when then partnered with Amazon (there was no other earnings opportunity on Amazon so those points were essentially free). Guess I should shop around and see if I can find a cheap award to get a B6 flight on my record before they get chopped up into bit (as some forecast). Maybe LAS-LAX? Or maybe I should wait and see if those points turn into miles in another program…
This is such an uneducated and non factual attack piece. I think Robin has given JetBlue what they need to be successful in the future. Particularly positioning JetBlue well with Mint and transatlantic routes. The two things that have the highest profit margins at the company. It’s impossible to fly everywhere and find growth in highly saturated markets while maintaining slots in NY. Growth is slow but besides from the operation weaknesses that can be fixed relatively easy; the future is bright. And Robin did an amazing job. I ask that you do some research before writing garbage.
You might be standing alone on this opinion. Robin’s leadership destroyed the employee culture and forced the unionization of multiple workgroups. Spent billions on stock buybacks at the expense of paying profit sharing/fair wages, which are now worth a quarter of the price they paid, so almost a billion went up in flames. Invested millions into a doomed LGB operation and moved the losses over to LAX, lost the leadership positions in BOS and FLL, the operation remains a mess, and destroyed billions in shareholder value.
All the JetBlue fanboys and blue juice drinkers will point to Europe as a symbol of success but that’s an overestimation of Europe’s importance in B6’s network and ignores that the core network continues to lose money.
“The future is bright” What makes you think that? They don’t have dominance in any market, racked up a ton of debt, are still not profitable, and owe a cash payment to Spirit’s shareholders.
Growth is slow but besides from the operation weaknesses that can be fixed relatively easy” The operation has always been a disaster. What is the relatively easy fix and why do you think they’ve neglected to do it for over 20 years?
Anthony, I have to disagree with the culture part. Robin is very well-liked by many at Jetblue. You’d be hard-pressed to find many people who dislike him. He is often described as the nicest, jolliest man, very approachable, and down to earth.
The unionizing of the flight attendants and pilots had nothing to do with him. I know this because I am a flight attendant for them for going on 19yrs now.
I agree, I’m getting a sense of a bit of snobbery of the uphill battle jetblue has. A bit of “stay in your lane little guy”. Frankly I’m tired of how protectionist our industry has become over the legacy 3. One airline trying to make a dent in it and they get crapped on. Just my .02
A good read, thanks for the article Cranky! I think B6 still has a chance to survive on it’s own long-term, but the window is definitely shrinking. The Big 3 will apply a lot of pressure from all directions with all their growth bringing them past 1000 planes in the mainline fleet. I can’t see DL backing down at all in BOS or JFK.
B6’s European expansion is quite a telling division for commenters here. But if it were profitable to fly narrowbodies TATL to major European hubs (LHR, CDG, AMS), we’d see major airlines doing it. B6 has a premium-heavy configuration, which means it has limited potential in smaller cities like CPH or BRU. The Big 3 print money funneling traffic during the summer to Europe with widebodies, which B6 can’t do. During weak-demand periods, B6 has limited ability to leverage connections to fill the plane. Right now B6 has 14/24 and 12/24 Mint seats open on JFK-LHR tomorrow (1/23). The day after it’s 8/24 and 18/24. This is very anecdotal, but it signals B6 has trouble filling Mint during periods of weak demand. Everyone is profitable TATL in high season, but I find it difficult to see how B6 can sustain year-round profitability TATL as it continues to expand.
Your anecdotal Mint flight loads are way off.
well said on so many levels, CF.
JBLU simply lost the plot of providing good, reliable transportation years ago and has been chasing every shiny option that appeared it might boost its size in what can best be described as a Napoleonic complex. JBLU has not been content to succeed w/ what it has which has provided all kinds of opportunities for competitors.
From a network standpoint, the simple reality is that JBLU really has no moats which Warren Buffett said is the single greatest factor to ensuring success, esp. in businesses that are essentially commoditized in nature – such as airlines. Delta aggressively grew in NYC when slot controls were not in effect post 9/11 and overtook JBLU and American at both LGA and JFK. In the covid era and beyond, DL has aggressively growth at BOS.
B6 was distracted by lots of attempted focus cities, none of which have worked.
They have the financial resources to bleed some more money but the chances that Joanne will come close to turning JBLU around.
Considering how young JetBlue is, this is all sad to see.
do you have confidence that Joanna will turn B6 around? Maybe leadership reorg? What do you think?
Tim, where did delta get those jfk slots? It bought them after screwing over and killing a iconic American company called panam. How did they grow Lga? They bought them in a slot swap deal with us airways. Delta didn’t just “grow” in those markets like in some magical rising force, they bought themselves into the game. I’ll give you Boston but yet delta made Boston a “hub” and crew base back in the early 90’s then let it go when jetblue swallowed it up. Jetblue will not cede Boston in fact it’s gearing up to pass delta there. Delta never regained the Boston market share it once held cause it foolishly let it go. But let’s ignore that piece if history and focus on the folly of jetblue. The little guy.
Delta got more JFK slots when the FAA dropped slot controls post 9/11 than it got from Pan Am.
Pan Am was carved up between Delta and United. Delta hired far more people. United essentially shut down the ex PA Miami operations and restructured its Latin operations to UA hubs.
Delta and USAir were the two largest carriers at Boston before 9/11. It is US and AA that have lost most of their share in Boston
I’m confused. Don’t all Jet Blue airplanes that have Mint also have hot ovens?
Michael – No, the domestic Mint aircraft with 160 seats do not. When they pressed those into service on some European flights, they had to alter meal services. It’s only the LRs that have the ovens.
True, in coach, but they all have ovens for Mint.
Hi- Cranky, correction. All of the JetBlue MINT planes have ovens even the domestic ones with 160 seats, each and every one of them.
Our LRs are the only fleet that have ovens in economy, that is the only difference.
Sincerely,
A JetBlue MINT qualified crew member
B6FA101 – Oh shoot, sorry. I have put a correction in the post. Thanks.
So how do they serve hot meals in Mint on the non-oven equipped, Mint equipped a/c?
all the Mint equipped planes have ovens for Mint passengers, the LRs have ovens for Mint and Core passengers
Ahhhh…..that’s where I was confused! Thanks for clarifying.
Michael – I was corrected (and updated the post) that they do have ovens for Mint. It’s just the rest of the airplane that does not have ovens in the regular.
We serve meals in core on the non MINT equipped LRs in core(economy) on trans Atlantic flights.
The meals, however, are cold, so think Macaroni salad, chicken and bow tie pasta. Basically think of the cold food bar at Whole Foods, we serve that on the non LR trans Atlantic flights in economy.
It’s actually not that bad of food either!
The problem with JetBlue for me is that they only fly from my home airport to NYC and Boston. Unless I actually want to go to NYC and Boston, there is little use for me to fly them. And, other airlines also go to those cities too.
exactly! I think most of teh Mountainwest can say that, too.
To be honest, both KJFK and KBOS are also on the list of most delay-prone and least-desirable airports I would want to fly into.
I’m not a huge BOS fanboy, despite flying more from BOS than any other airport in recent years. The one thing I’ll say in defense of BOS, however, is that Logan is closer to the downtown/business center than almost any other “big city primary airport” in the US is, and I have rarely had/seen long wait times at TSA (even when I look over at the non-PreCheck lines) or long times to get from curb to gate.
That said, the location & tight availability of land is also reflected in on-airport economy parking rates, which run $48/day at BOS, somewhat similar to parking rates in the BOS city center and significantly more expensive than on-airport economy parking costs at most other airports (e.g., $35 for LGA & JFK).
Going way back, was purchasing the E190s a mistake simply because of economics or are they problematic in other ways?
I haven’t flown a JetBlue E190 in a long time, but both 10+ years ago when I did as well as on other airlines more recently, they seem fine, and they also seem well-liked by other airlines. (Specifically the E190 although maybe some of it applies to the E170/175/195 as well).
Jason H – Those airplanes were just a bad fit for a lot of reasons.
Economically, they are awful for anything over 2 hours. JetBlue ended up flying those on some thinner Northeast-Florida routes, and they are just pigs. There were also a ton of reliabiliity issues on that fleet which made life miserable.
It’s easy to be critical in the light of 20/20 hindsight. Or…as Theodore Roosevelt put it:
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
This comment doesn’t imply that people can’t or shouldn’t learn from their mistakes.
JBLU needs to go single fleet, get rid of the Europe flying, focus on the operation, rollout a new and improved ancillary revenue menu that makes consumer sense and return to Neelman basics. The above is gonna be ugly and may even require a trip through bankruptcy however they are wildly off plot and need a complete out of the box radical fix, perhaps even roll it into an Ultra that is unique and Blue.
Jetblue has been having an identity crisis for over 10 years, getting further and further away from what made them the industry darling. A return to greatness is possible however it is gonna hurt like hell.
The 16-seat Mint non-LRs that go trans-Atlantic were only made to be ETOPS certified to be a spare in case an aircraft went tech; however, with delays with some of the LRs from Airbus, they ended up being used more regularly. Hence the reason, they don’t have ovens on the non-LR MINT plane that seats 160 people in the core.
That plane mostly flys to Gatwick(I assume this is because Gatwick doesn’t have the demand for 24 business class seats), and we have been using the LRs with 24 MINT seats this winter on JFK-LAX/SFO and BOS-SFO/LAX. It will be doing LAS, too, for the first few weeks in February(I think) to grab the Super Bowl crowd.
The 24 MINT seat-equipped LRs have been printing money on the JFK-LAX route, and the same when used from BOS to the West Coast. This is where they finding a place for that sub-fleet this winter.
@desertghost. I think you watch BlueBloods. I saw that episode. It was the first and last time i watched BlueBloods.