JetBlue Expected To Pull The Plug On West Coast Flying
JetBlue is struggling financially. The government shut down their two main plays to grow – partnering with American Airlines, and buying Spirit – though they were overpaying for Spirit and the strategic rationale for the acquisition simply no longer made sense without the Airlines Airlines partnership (which provided an opportunity to grow in New York and Boston, for which they needed planes and pilots).
They have Carl Icahn breathing down their neck. Their new CEO needs a turnaround plan. So far they’re raising fees. They clearly need to cut money-losing flying, but that’s not going to be enough.
- Their West Coast operation performs poorly
- Their transatlantic flying has been weak
- Their brand has eroded, as a result of on-time performance at the bottom of the industry and an erosion of their inflight product over the past 15 years, reducing the differentiation between them and competitors (although still offering a bit more legroom, seat back TVs, and free Wifi).
Aviation watchdog JonNYC says that the network is going to see changes – cuts to unprofitable flying – and we’re days away from a reveal that scales back Los Angeles. He first teased that as the plan last month:
B6: rumor,
“JetBlue will be making a network announcement in the next week or so
It’ll be cuts to the network that they are still flying in anticipation of the spirit merger
But since that’s off the table now they won’t be hanging onto them any longer”— JonNYC (@xJonNYC) February 13, 2024
“Are you hearing about any specific markets or regions for B6? I’m hearing they’re gonna pull back on the west coast. Going from LGB to LAX has been a disaster”
— JonNYC (@xJonNYC) February 23, 2024
Now he reports that it is happening:
definitely feels like Jetblue’s west coast operations will take a hit when the cuts are announced this week.
— JonNYC (@xJonNYC) March 18, 2024
It makes sense for JetBlue to fly to Los Angeles from New York, Boston and perhaps Fort Lauderdale. But their LAX operation has been bleeding beyond that. Their other flying includes Los Angeles to:
- Las Vegas
- San Francisco
- Salt Lake City
- Miami
- Orlando
- Reno
- Los Cabos
- Liberia, Costa Rica
- Buffalo
- West Palm Beach
- Nassau
JetBlue needs to build back Boston. They’ve allowed Delta to grow as they focused on New York during the time of their American Airlines partnership. They should clearly re-engage American Airlines on a partnership, pull back from the West Coast, and focus on the Northeast – a return to their roots.
The West Coast has long been a potential market for JetBlue. They bid against Alaska for Virgin America and considered trying to buy Alaska itself. On their own they lack scale, and routes are pretty picked over.
The big question is how much JetBlue will pull down Los Angeles, and whether it’s enough for someone else to get some of their gates at the airport?
