Analysis: Why JetBlue should worry

[Joblu]

In a word, wrong, except for the good people part of course.

How is growing your ASMs by 8% in 2008 shrinking?
Even if they sell 5 older airplanes they are still netting 2 320s and 6 190s.

BDA, CUN, SXM, BQN, SDQ, POP, STI, AUA, and 3 cities in PR are all non-domestic routes with many served from more than just JFK (ok the last PR and POP are US territories). Almost 20% of JB's ASMs are to/from the Caribbean.

LH is about to invest $300+ million in Jetblue. How many other airlines are having other airlines writing them checks?

Look, Im a realist, not a kool-aid drinker, but B6 has just about a good of shot at making it as most.

Yeah what he said so there!!! :laugh:

 

[Headfake14]

Get this guy off the Kool-aid! "stuff is in the works???" please.

Unfortunately, JB does not have enough traction to compete in the long run, and is apparently shrinking their fleet.

They also have zero international to fall back on. Great folks there, but not enough in this cutthroat industry.

I can't imagine they won't be in bankruptcy in another 12-18 months.

Doesn't some knuckle head say this every few months? Aaaaand we're still turning profits. EVEN with the 2/14 issue, I bet we're still in the green for the year 07.

 

[clickclickboom]

Tune in 1 year from now and lets see if JB has at least 1 if not more marketed international partnerships.

Russ Chew himself has said that we need a larger airframe for latin, south and central america growth as well as possible " eastbound " growth.

New terminal that just like our airplanes we will never have to pay for.

I always get a kick out of these guys that foreshadow the demise of jetblue let me guess they flew with some crusty nwa lifer that doesnt commute that hates his job and blames his management indiscretions on the birth of jetblue. Or maybe they graduated from some top gun college got their rj job and have not gotten called for the interview? These same people probably never set foot on or know even the first thing about jetblue.

There is not one pilot that has a crystal ball. Is my airline going to be here in 5 years? Is yours?

 

[climbhappy]

i said it last year and i'll say it again. best product, bar none. rode on 'em and enjoyed the three hour leg. it is first class in coach is what it is.

that said, give them time. a few good quarters and some cash flow and it will come back...if we're only talking about stock price. if they can keep growing RPMs and keep cost constant, they'll go from being a candidate for a hostile takeover to an acquirer.

 

[puddlejumper101]

i said it last year and i'll say it again. best product, bar none. rode on 'em and enjoyed the three hour leg. it is first class in coach is what it is.

that said, give them time. a few good quarters and some cash flow and it will come back...if we're only talking about stock price. if they can keep growing RPMs and keep cost constant, they'll go from being a candidate for a hostile takeover to an acquirer.

while I totally agree that Blue has the best product out there...it has nothing to do with the product as much as their leadership. In this Wal-Mart society having a top notch product doesn't matter. It is not the hamburger that sells but the hamburger salesman that provides the system. Anyone and everyone can make a better burger than McDonalds...but yet look at them. Gene Simmons said it best...it is not about the Hoover Vacumn Cleaner but about the vacumn cleaner salesman. If Jet Blue's top management isn't careful, Jetblue can fail reguardless of how good their product is. If we are talking about product, then how did SWA become as successful as they have been?

 

[clickclickboom]

while I totally agree that Blue has the best product out there...it has nothing to do with the product as much as their leadership. In this Wal-Mart society having a top notch product doesn't matter. It is not the hamburger that sells but the hamburger salesman that provides the system. Anyone and everyone can make a better burger than McDonalds...but yet look at them. Gene Simmons said it best...it is not about the Hoover Vacumn Cleaner but about the vacumn cleaner salesman. If Jet Blue's top management isn't careful, Jetblue can fail reguardless of how good their product is. If we are talking about product, then how did SWA become as successful as they have been?

I agreee with your above post.. Maybe instead of product we should discuss " culture " Fostering Culture is what SWA does best. Everything else like direct tv, xm radio, unlimited snacks, headsets, wakeup hot towel service, inflight internet etc etc are all little pieces of the puzzle.

The best experiment in product vs culture vs service will be skybus. Lets sit back and see what happens..

 

[CaptainSpaz]

Culture?

Product?

How about these things:

Business model.
Ticket pricing.
Management effectiveness.
Marketing.
Advertizing.
Timing.

 

[climbhappy]

i love the best experiment moniker for skybus.

i think jetblue is right in offering amenities. they do stand out. heck, if you're gonna get delayed, why not be able to watch sportscenter.

for skybus , just to compare the two, it is radically different. all the way down to not using jetbridges and using two level catwalks. admittedly they seek an untapped market, those who rarely if ever fly. with the economy going down, i wonder if there is enough of them to use it consistently?

 

[lookin4better]

Im am sold on jetBlue and excited about it......very much lookin forward to the open house

 

[Truckdriver]

Russ Chew himself has said that we need a larger airframe for latin, south and central america growth as well as possible " eastbound " growth.

Nevermind..........

 

[Truckdriver]

LH is about to invest $300+ million in Jetblue. How many other airlines are having other airlines writing them checks?

So you think it is a good thing that JetBlue is selling itself in pieces? If Dave thought he could make it through 2008 without a $300 million check then I'm sure he wouldn't have put out the for sale sign. You are absolutely a Kool-Aid drinker if you think this is a good thing.

 

[Headfake14]

I haven't heard anything bad about it yet...yer the first.

...I don't sense a tremor in the force for us...we'll be fine

 

[climbhappy]

just curious if dave was ever called on the carpet for not getting the airbus 318 with all the commonality. anyone calculate what the company would have saved over the whole shubbang?

 

[zkmayo]

So you think it is a good thing that JetBlue is selling itself in pieces? If Dave thought he could make it through 2008 without a $300 million check then I'm sure he wouldn't have put out the for sale sign. You are absolutely a Kool-Aid drinker if you think this is a good thing.

Newsflash---every airline that is publicly traded has a for sale sign up every day. Is there a new division of JB that's been spun off with that 19% that was sold? Didnt think so.

I would say it would be a bad thing if Lufthansa looked at JB and then said 'no thanks' compared to them looking at JB and then spending $310 million on it. So, therefore, yes I do think its a good thing. If that makes me a bluejuice drinker in your book, so be it, although i fail to understand why. I really dont care bc: a) unless you work at JB, I guarantee I know more about the co than you, b) JB is my last stop in the airline biz in that if it fails, i am done with the BS 121 world. Life is too short to be chasing starting pay at 1st year pay at another carrier.

Also, JB issued about 19 million additional shares of stock, so the same amount of stock (net) is out there on the mkt as before the LH purchase. Barger or anyone else for that matter has never indicated they want any part of the M&A activity that is going on now. If anything, they have given every indication that they actually care about running a good airline instead of making a fast buck of a merger, unlike a bunch of mgt out there.

 

[CaptainSpaz]

just curious if dave was ever called on the carpet for not getting the airbus 318 with all the commonality. anyone calculate what the company would have saved over the whole shubbang?

You mean David? I'd say he's been called out, yea. The debacle last Feb. was just the straw that broke the proverbial camel's back.