Jetblue approved for ORD

[XBOEINGDRVR]

this is too funny... they all said airtran was doomed a few years back, oh yeah.. then it was airways who was days from going out, then delta, etc... blue WILL be around- just like airtran. get over it !

 

[Spectre]

Most of our customers are leisure travelers, and make their own decisions. Very few breif cases, and many car seats. Again, I've not heard anyone that can back up those statements as to why we will last only 5 more years. ------------- Well?? ------------

Beg to differ. We have many business travelers JFK-BOS, BOS-IAD, JFK-IAD and have the frequency on those routes to make it a good alternative to the other legacy shuttles.

 

[Spectre]

Your note that you carry almost all leisure travelers does not bode well for meaningful revenues. As I mentioned previously, Joe 6-pack will spend a couple of hours shopping on the internet for the lowest fare. Saving $100-200 bucks on the family trip is a big deal. That pays for a rental car, or hotel, or meals etc..

Here are Frank's top 10 reasons you are doomed:

1. You are still expanding too fast. Your high yield markets are drying up fast if not already gone. Moves like going into ORD look like desperation. You really believe you are going to make money on that route? Which leads to #2.


2. The legacies are making money. The next year or two forcasts them making A LOT of money. Any guesses how they will price their routes where you compete with them? They are going to absolutely hammer you guys. You losing ONLY $40M a year will soon look like a good year.

3. Costs (wages, benefits, maintenance, training associated with a mixed fleet etc.) are only going to go up. Not exponentially, but enough to cause serious balance sheet anxiety.

4. Unions will arrive on property. Costs go up further. Worker discontent. Service deterioration.

5. Recalls at the legacies will cause a surge in training costs. There is also a very real potential for serious operational disruption if a sizable number of furloughees leave at the same time.

6. The legacies will start pouring more and more money into the "service" portion of their operation (returning meals and other amenities to their aircraft). This will further blur the lines of who has the best service.

7. No meaningful frequent flyer program. Can I go to Europe or Hawaii on JBLU?

8. No code share partner to offer more destinations and pick up the higher yielding business traveler.

9. Your supposed "money in the bank" may be less than you thought. As a witness to history, you have seen how long it takes an airline to blow through an enormous sum of cash. Even $900M may not last long at all.

10. Your management team is inexperienced for the size of operation you have. It is already cracking under pressure and succumbing to making rash, knee-jerk, reactionary, and desperate moves.

BONUS! #11. Grossly underpaid executives! (Couldn't help myself)

1. That's why JB sold 5 A-320s and are slowing down orders for the next 3 years.

2. Legacies are making money on the backs of labor. Huge pay cuts in the 30% range for many legacy pilots and lost retirements. Believe me, when their company makes money, the unions will make sure to get the money back. Watch USAir closely as they renegotiate their contract this year.

3. Seriously, my $2/hour/year Captain pay increase is not hurting our company.

4. This year's effort by unions to organize our ground workers was shot down DOA. Management needs to step up and address many issues that worry our workers, such as increased medical costs etc. Many workers here are from former legacies and we know how unions work...

5. I was recalled by NWA. Not gonna go back. Not many takers here to go back to former legacy carriers. Too many stories of so and so going back and hitting the streets again on second furloughs...begging to come back. Only potential are FO's on E190, but they'll hopefully get the same pay as A320 FOs soon.

6. SONG installed TVs in their aircraft and where is SONG now. SWA has no meals or amenities and I think they are doing better than all the legacies.

7. Can you goto Europe on SWA? Maybe Hawaii with ATA code share. Nothing is free. People pay higher domestic ticket prices to earn their free European vacations. Furthermore, those tickets have so many restrictions it is almost criminal. SWA's and JB's frequent flyer programs make it harder to earn "free" tickets, but are less restrictive.

8. Soon to announce some international code share partners...Why not, we operate out of JFK where many travelers can connect on an international carrier.

9. UAL can go through 3 years of bankruptcy...I think we'll be around for more than 5 years.

10. ...VS the sound decisions made by the "experienced" management at the legacy carriers the last ten years? LOL.

 

[XBOEINGDRVR]

well put spectre

 

[GuppyPuppy]

Another useful quote from GuppyPuppy....

And a not so useful one from Zipperhead...

If you remember, Independence was rated a close second to JetBlue (I believe last year). They weren't making money. And now they're history.

Being a highly rated airline is great. If you want to rest on those laurels then good for you. However, I would hope that the company is in business to make money.

GP

 

[zkmayo]

And a not so useful one from Zipperhead...

If you remember, Independence was rated a close second to JetBlue (I believe last year). They weren't making money. And now they're history.

Being a highly rated airline is great. If you want to rest on those laurels then good for you. However, I would hope that the company is in business to make money.

GP

Your point is a good one, but I have heard mgmt here say as soon as the ink is dry on a press release "we dont spend our time looking in the rear view mirrror." ie we dont rest on our laurels looking at our past accomplishments.

Jb has its set of issues, heck its an airline after all, but one thing you cant accuse them of is not being forward-thinking.

 

[Frank Lorenzo]

I didn't say my opinions were foolproof.

At least I had the courage to post them.

Predicting the airline industry is like predicting the weather. Everything can change in a day.

Only time will tell.

I just don't see JBLU succeeding in the long term.

The one thing I did not was that note of yours about recalls. I think the potential recallees at JBLU are just keeping their options open. Sure they are not accepting recall NOW. Give it a year or two. If the legacies are doing well - hasta la vista baby. You will see a mass exodus.

 

[BLUE BAYOU]

Great comeback Spectre; sounds to me like you've got too much time in ROC today, heheh....

 

[Bavarian Chef]

Your note that you carry almost all leisure travelers does not bode well for meaningful revenues. As I mentioned previously, Joe 6-pack will spend a couple of hours shopping on the internet for the lowest fare. Saving $100-200 bucks on the family trip is a big deal. That pays for a rental car, or hotel, or meals etc..

Here are Frank's top 10 reasons you are doomed:

1. You are still expanding too fast. Your high yield markets are drying up fast if not already gone. Moves like going into ORD look like desperation. You really believe you are going to make money on that route? Which leads to #2.

2. The legacies are making money. The next year or two forcasts them making A LOT of money. Any guesses how they will price their routes where you compete with them? They are going to absolutely hammer you guys. You losing ONLY $40M a year will soon look like a good year.

3. Costs (wages, benefits, maintenance, training associated with a mixed fleet etc.) are only going to go up. Not exponentially, but enough to cause serious balance sheet anxiety.

4. Unions will arrive on property. Costs go up further. Worker discontent. Service deterioration.

5. Recalls at the legacies will cause a surge in training costs. There is also a very real potential for serious operational disruption if a sizable number of furloughees leave at the same time.

6. The legacies will start pouring more and more money into the "service" portion of their operation (returning meals and other amenities to their aircraft). This will further blur the lines of who has the best service.

7. No meaningful frequent flyer program. Can I go to Europe or Hawaii on JBLU?

8. No code share partner to offer more destinations and pick up the higher yielding business traveler.

9. Your supposed "money in the bank" may be less than you thought. As a witness to history, you have seen how long it takes an airline to blow through an enormous sum of cash. Even $900M may not last long at all.

10. Your management team is inexperienced for the size of operation you have. It is already cracking under pressure and succumbing to making rash, knee-jerk, reactionary, and desperate moves.

BONUS! #11. Grossly underpaid executives! (Couldn't help myself)

It is a 50-50 chance that any or all or none of those things will happen. Frankly (ha), I don't like those odds.

 

[cezzna]

I don't like JB's chances or anybody else's for that matter. You guys really think the legacies are making money? It's all smoke and mirrors until real sustainable ticket pricing comes back ala re-regulation or some other measure.