Jet Blue 11th biggest Airline

[pilotyip]

Jet Blue had the 11th highest RSM of all airlines. 1/19 the size of American for the first seven months of 02. Also had the highest load factor of all airlines reporting. Not bad for an upstart.

 

[HA25]

Wait till those airbusses start to need heavy maintenance, then costs will rise and so will their fares. Its a good time to be a discount upstart, but the economy will improve soon, and their competition SWA will not stand still.

Eitherway, it is good for a new company.

 

[Kjet]

SWA had better watch their backside. I have flown many a times on both and jetBlue offers a far superior product.

 

[kwijybo]

What up with the shots at JB?

I love the run the JetBlue bashers give. Gee, I don't think that the whole aging process has been thought out by the management at JetBlue. Its not like the 320 has been around for more than 10 years, and they have no track record as to what to expect as the plane and the engine age nor are they being proactive about these issues now. I mean, there is no reason to expect that the management or pilots would give a moments thought to this fact and plan for it. Me, I am a TO/GA man 100%. Don't forget to tack on that- JB is leasing its airplanes and the favorite non union below pay scale complaint as well.

I wanted to laugh at G. Bethunes quote that we are 'smoking ragweed' whatever that is- check that, I did laugh, not at the quote, but at what an anachronism he is. There is a man living in todays world. Ragweed, what is that? Something he did in the 50's at the Sock Hop- that stuff is the cats pajamas.

I mean, what is the deal with the potshots at JetBlue? I have nothing to but good things to say about 'the competiton' -SWA. That is a great airline that has the big picture. But where is the love for JetBlue?

Some dude named Gandhi once said-
First they ignore you,
Then they laugh at you,
Then they fight you,
Then you win.

You see, Gandhi was this guy who....ahh, never mind.

I will save my good smack for the future, JetBlue hasn't quite reached critical mass yet, and you never know what could happen, but I never seem to read posts from JetBlue dudes ripping other companies, why is that?

V70T5- you do the math.

 

[HA25]

Sorry not really meant as a rip, just pointing out a fact. When the CEO of JB was asked over a conference call about this subject he skirted it, even though SWA has significantly higher maintenance costs, and are returning the same margins at the end of the day. JB will make it, that's not debatable, they just won't beat SWA at a game they invented. And both will not spell the end of "network" carriers, unless we do away with 65% of the traveling public who don't live in the 80 big cities that are workable under the SWA/JB model.

BTW CNN did a great 1 hour with CEO Neeliman(sp?) on Pinnacle today. Very interesting when they asked him on how to compete with SWA.

 

[Race Pilot]

Jet Blue is great!

Well, I for one will say that I think Jet Blue is a great airline. I have read a lot about them both from an employer and customer perspective. I think David Neeleman (correct spelling for sure), David Barger, and all the others in management there have thought this thing through in great detail. Neeleman has plenty of airline experience including a company he sold to Southwest in 1993. I believe he knows where his airline is going and how to get there. If he skirted around questions the media asked, I say GREAT!! Most of those media types would just as soon hang someone that's out there trying to do the right thing and working for a living. Jet Blue is here to stay and all the "low-cost" carriers (which soon will be everyone anyway) better keep a keen eye on them. SWA may have started it all '71 but look at it this way, some of the airlines that literally started it all way back when are no longer here.

 

[zonker]

I turned down a job at jetBlue. Biggest mistake of my career.

 

[SWA/FO]

What is the deal with the training agreement or employment agreement that you have to sign with JB? I'm not talking training costs, pay for training...something like an employee contract? Anybody know anything about this?

You guys know what I mean? I just heard this from a Guy who turned JB down and he was talking about something that they wanted him to sign. (He turned them down over a year ago). It was his belief that your CEO was going to sell down the road.

I wonder what will happen to JBLU stock when everyone trys to cash out in October?

 

[Jeff G]

I'm not sure what you mean by being held by the short hairs. It has the same kind of content you'd find in collective bargaining agreements, and is patterned after them to a large extent. It's a binding contract, so there's no arbitrary changes to working conditions by the company, and also no excuse on the pilot's part for claiming not to know what the conditions would be. Except that the conditions can be arbitrarily *improved* (e.g. the wages are a defined minimum). It's not written as a set of handcuffs, just as a clearly defined employment agreement. I've seen negotiated agreements that are far worse. Indeed, look at just about any other national carrier, and you'll find one. What's the problem here?

BTW, Zonker, why did you turn down JB? Just curious. I've heard stories both ways and wanted yours.

 

[zonker]

Well, like I said, I was speaking from a limited base of knowledge. So it seemed to me that there were no improvements available for 10 years. Obviously that was incorrect.

I had a choice between JB and one of the Big 5. Hindsight, you know... I update my application all the time. I'll be back.

 

[JayDub]

There is also a contract for folks coming to us from other airlines. Instead of resigning your seniority, they ask you to sign a gentlemen's agreement that you plan on staying for atleast two years. I don't know how you could consider that being handcuffed really.


JayDub

 

[zonker]

Sign? Hell, I'll resign...

 

[SWA/FO]

*I thought is was something about the assets of the airline could be sold without the pilots.

I'm sure it all lawyer talk within the agreement as with any contract. My Friend just seemed to be concerned with the whole agreement.

 

[Gumbydammit]

What I have seen of the agreement...which is second-hand but from a reliable source is that the company can sell and must REQUEST preferential hiring for the pilots...not a lot of protection.

Also, I believe that EVERYONE is obligated for the two year contract such that if ANYONE goes to another carrier before 2 years you pay a prorated cost for training (i.e. if you go to say Fedex after working there a year, and the training costs 24,000, you owe them 12,000)...someone check me if I'm wrong. Having said all that, I think the company is just trying to protect its growth potential with the training contract since they rely so heavily on being able to keep people once their trained. Just think if things turned around as suddenly as they went to sh*t (fat chance)...they would be screwed if all those people left to go to the other carriers...they would be cancelling flights all over the place...pilots currently fly over 80 hours per month...even losing a few would hurt.

The "union" agreement is effectively an employment contract you might see anywhere in the business world...I think they will work like hell to keep it non-union much like Delta and their nonpilot work force...very good pay, benefits and work rules with the guarantee there is no union to hold the company hostage over any issue and screw up the business model. Of course there is no scope and I believe they have already outsourced a small amount of flying to keep certain routes alive when airbus failed to deliver aircraft on time (like the one that was damaged at the plant)...I dont think this would ever be the norm because outsourcing to Evergreen or whoever falls way outside their model and delivers an inferior product in the view of the company.
Overall, what you give up in certainty and union protection, you have huge potential for success...ultimately a classic trade off of risk vs reward, and in this environment, a better option than most in my opinion.

 

[Jeff G]

What I have seen of the agreement...which is second-hand but from a reliable source is that the company can sell and must REQUEST preferential hiring for the pilots...not a lot of protection.

What you didn't mention is that if for some reason you don't get to work at the new company, you get a paid a year's salary and all your stock options immediately vest. So there is compensation of sorts.

Also, I believe that EVERYONE is obligated for the two year contract such that if ANYONE goes to another carrier before 2 years you pay a prorated cost for training (i.e. if you go to say Fedex after working there a year, and the training costs 24,000, you owe them 12,000

No, that's incorrect. That's a training contract and there's no provision for that. If you come to JetBlue from another carrier without resigning first (read: furloughees), you sign a non-compete agreement. I don't know all the details since I never signed one, but the agreement is enforceable on both you and your former employer for a certain period. That way it's not a matter of "resigning your seniority number" then having your "resignation" get thrown out when your last company wants to recall you. It protects JetBlue better than the usual letter. You can always leave to go to a different company, just not the one you just left.

Of course there is no scope and I believe they have already outsourced a small amount of flying to keep certain routes alive when airbus failed to deliver aircraft on time (like the one that was damaged at the plant)...I dont think this would ever be the norm because outsourcing to Evergreen or whoever falls way outside their model and delivers an inferior product in the view of the company.

Many scope clauses have a provision for short term wet leases in just such a case, though. So having a formal scope clause wouldn't have prevented it. Nor would a responsible group want to prevent it. The first duty is to protect the schedule and your customers. However, the crews that would have flown those trips were all paid as though they had. The trips still flew so our customers were happy. They were especially happy because they all got a $50 refund for the inconvenience of not flying on JetBlue's airplanes. Not that TransMeridian did a poor job, but the service wasn't what was expected either. And I have no doubt Airbus ended up paying for all of that, and then some, since it was their failure to perform in the first place.

Overall, what you give up in certainty and union protection, you have huge potential for success...ultimately a classic trade off of risk vs reward, and in this environment, a better option than most in my opinion.

I agree, obviously. Your mileage may vary. The last "protection" though, is the credibility that the senior management has with the rest of JetBlue. They know that they can only "blow it" just once in a big way, and the experiment fails. If that happens, if there's even a strong possibility that they sold out their people, it'll be just like any other airline, with all that implies. So I think there's a great deal of incentive to not blow it. Fortunately, at least at Southwest, there's a model for not blowing it and keeping the faith with your people. Current problems there seem to be the result of getting so large that you dilute the culture and start losing track of what makes you great, not the result of breaching trust. I'll be very curious to see how it plays out over there.

 

[Gumbydammit]

Jeff G
Good post...I am unsure about the training contract thing though. I have friends who were hired off the street (ie not furloughhees) and I'd swear I thought they had to sign something about not going with another carrier for 2 years or else they were obligated to pay something...then again maybe I picked the wrong week to quit sniffing glue....

 

[AlbieF15]

When I researched the company prior to my interview at JetBlue in 2001, my question was "what happened to all the Morris Air guys?". I heard from the board they were moved into SWA, but I have no idea if they were "stapled" or "weaved" into the organization. An old SWA guy (Rob Beeks) or someone around from the early 90s might be a good source. The point on seniority was likely moot, however, as SWA's expansion meant even if they were "stapled" they were likely captains in 3-4 years. There were also no issues of being "bumped" off their beloved (747, DC8, Airbus, etc) because both Morris and SWA were built around the venerable 737, so other than a seat demotion ( if it happened) I doubt things changed that much. Any old Morris Air guys got their story?

As for buying out JB...well....at 38-50 bucks per share its going to be hard for any major to justifiy buying them out. First, the announced "public" merger will send stock price soaring, further raising the cost of the deal to the acquiring carrier (remember when USAir stock hit the high 40s....gosh how long ago was that?) Second--where will the acquiring company get the capital? Right now U is in bankruptcy, UAL is close, and DAL and AA seem hellbent on cost control--not the best time for acquistions. Finally--JetBlue has established serious political clout as a company "doing it right". How many times per month does Bill O Reily from Fox hold them up as the right way to do business? Any article on the airline woes always point out the exceptions...Air Tran, Frontier, SWA, and JetBlue....but the FAVORITE of the bunch always seems to be JetBlue.

As for why to go or why not to join the team there--that is a very personal decision, but not nearly the gutcheck it was two years ago when Majors were hiring. You are likely 3-5 years away from being hired at AA, DAL, or UAL due to current furloughs and restructuring--why bother comparing a HIRING company to one that isn't? Unless you have a job lined up with SWA or FedEx, there is (IMHO) zero opportunity cost associated with going with JetBlue. In 2001, I passed on JetBlue not due to their contract or fear of their future (coversely I sort of thought they WERE the future), but because the 30 in 7 rule for domestic carriers limits you to about a 4 day trip per week, and that means to fly 70 (low) or 95 (high) hours at JetBlue, I'd have to commute at least 3 and more likely 4 times per month. If you try to fly 7-9 days per month in the ANG, the math adds up to a tremedous amount of stress for a commuter. Jetblue pays you more for any hours flown over 70 hours (1.5 times)...but with ANG work I would have had a hard time ever seeing that benefit. Had I lived in a JB city (vice a 2 hop commute), however, an agonizing decision would have been even tougher. Moving was not an option, as it was an ANG requirement to live within 100 miles of the base. Leaving the ANG wasn't an option for personal reasons--wanting to serve after 9/11 and also for job security, but also because STOP LOSS was in effect and I could not have left the unit even if I wanted to (which I did not!).

I have 2 Eagle bros that are board regulars that had the either FDX or JetBlue choice. One is there at JetBlue and LOVES it. The other is at FedEX and is quite happy. I think each of us wonder "what if" sometimes, but everyone is quite happy with their current situation. I do have a bunch of guys who said "Jet who?", however, that are looking at llllooooong times on furlough at UAL, AA, and DAL, and they all know EXACTLY who JetBlue is today.

Standard disclaimer--I'm just a pilot, and may be wrong....

 

[Race Pilot]

Many scope clauses have a provision for short term wet leases in just such a case, though. So having a formal scope clause wouldn't have prevented it.

I don't know about all the others but ATA certainly has something similar. It has limits as to number of days and how many per year, which is very few, so it's no big deal.

I am unsure about the training contract thing though. I have friends who were hired off the street (ie not furloughhees) and I'd swear I thought they had to sign something about not going with another carrier for 2 years or else they were obligated to pay something

You may be thinking of ATA. They have a 2 year training contract that equals $1000 per month.

Just doesn't quite seem fair to me that Jet Blue is hiring guys on furlough with only a two year "handshake" and guys like me that are leaving the Air Force after twenty years can't even seem to get an interview there. Oh well, I'll be happy at ATA.

 

[jointops]

Race Pilot,

Check your PM.

As to our hiring process. Well not to rehash what has already been adressed on this board (a few times) but:

We are hiring pilots across the board. Period. Half our classes in the past 5 months have tended to be from US Air or AW. Those pilots stereotypically speaking also were military pilots prior to flying 121. The other half were military pilots who are retirees or those who got out somewhere between 9-14 years. My sim partner was a Navy 14 year Blue Angel no less. Then the handful of classmates were Emery, Trans States, Trans Meridian, etc.

Since Jun marked the true computerized selection of interviewees, we'll see what the next 6 months of selectees includes. If JB is where you want to be send Dean an e-mail. Can't hurt. I do know of a few US Air furloughees who interviewed and didn't get hired. It's the personality that indicated they weren't a "company fit". The interview is all about the personality.

Hope some of this helps.

Happy landings,

 

[#1 Windmilling]

Hey All,
I am furloughed from one of the Majors and I start at Jet Blue next month. I signed a two-year no compete clause on the JB contract. However, my old carrier has a 3 year furloughed leave of absence clause. So, either way, one should be good to go. Check for a furloughed leave of absence. Chances are I will never go back to the scab airline that I was furloughed from. Can't wait to start sipping the Bluelaid. Y'all be cool,

#1W