JetBlue's founder orders A350s & A330s for his Brazilian airline Azul

[johnsonrod]

It helps his economics that he pays his Azul pilots/FAs incredibly poorly relative to US airlines... Azul will use A350/330s on the bigger Brazil-US routes. Maybe they will code-share with JB on the Brazil-JFK/BOS routes...

When will JB and Spirit jump into the low-cost longhaul game? They probably have the feed and gates to support bigger aircraft on popular routes by now...

See article below:

http://finance.yahoo.com/news/azul-brazilian-airlines-offer-flights-133000757.html

 

[labbats]

I'm not sure his plan is well thought out. A330s and A350s are all well and good, but when you only have 4 or 5 of each what happens when one breaks or a pilot gets sick? Are you going to leave one parked at all times and several reserve pilots sitting at home all month? Better to have gotten 9 or 10 of one or the other.

 

[Flyby1206]

Neeleman is great at leading an airline for the market share grab, but I'm curious how the finances look at Azul. They aren't a public company (yet) so nobody knows. His main problem at jetblue was the hyper growth that almost killed the airline, and created many PR nightmares along the way (V-day massacre).

This is a very ambitious growth plan for a small airline that doesn't even fly outside of Brazil.

 

[johnsonrod]

My guess is that he is doing a lot of this ahead of the Olympics in Brazil in 2016 when there will be a natural surge of passengers.

The fact is that Azul has a very large fleet of E190s and ATR-72s flown by cheap pilots. They should have all the feed they need for connecting flights onward to MIA, MCO, JFK and BOS.

 

[Tomct]

I think it is a Brilliant move, especially with the Olympics coming. He is positioning them to be right where the money is for the long haul market out of Brazil.

By the way, in the beginning he HAD to grow that fast. Otherwise the Legacies would have come in and crushed JB before they even got off the ground. Of course there were mistakes made, but their aggressive growth was not one of them...it is what sustained them in the tough times.

 

[johnsonrod]

I think it is a Brilliant move, especially with the Olympics coming. He is positioning them to be right where the money is for the long haul market out of Brazil.

By the way, in the beginning he HAD to grow that fast. Otherwise the Legacies would have come in and crushed JB before they even got off the ground. Of course there were mistakes made, but their aggressive growth was not one of them...it is what sustained them in the tough times.

But the question is: will JB eventually get in the low-cost longhaul market or will they instead code-share with low-cost longhaul operators like Azul, Norwegian, etc. and continue to focus on North America like SWA?

There has been talk about JB looking at A330s and even 787s in the past, but maybe Azul's aggressive move could be a catalyst for change at JB or Spirit.... Time will tell.

 

[johnsonrod]

Looks like Neelman and Azul will seek to code share with JB out of JFK, BOS and MCO:

http://mobile.bloomberg.com/news/20...-to-serve-u-s-with-wide-body-airbus-jets.html

I guess if JB does not move to longhaul Widebodies it can outsource some of that flying to partners like Azul...

 

[JetFumes]

But the question is: will JB eventually get in the low-cost longhaul market or will they instead code-share with low-cost longhaul operators like Azul, Norwegian, etc. and continue to focus on North America like SWA?

There has been talk about JB looking at A330s and even 787s in the past, but maybe Azul's aggressive move could be a catalyst for change at JB or Spirit.... Time will tell.

I believe Neeleman is doing this to steal Bargers thunder. He knows jetblue wants to do this ,
and this will complicate that.

 

[johnsonrod]

I believe Neeleman is doing this to steal Bargers thunder. He knows jetblue wants to do this ,
and this will complicate that.

It could be a race to see who could code-share with who. If Azul jumps into the Brazil-JFK/BOS/MCO/FLL markets with A330s and A350s, will JB be able to eventually enter the same markets economically if Azul provides the same service at low airfares? Or will JB decide a code share is the cheaper option and thus outsource this Brazil flying to Azul?

Longhaul LCC is a risky proposition, but the LCC market will always be bigger from a potential passenger volume standpoint than any premium market - and Azul pays its pilots/FAs super cheap so it already has an operating cost advantage over all US airlines. The timing of the Olympics helps to accelerate this transition plan to longhaul for Azul, but it may end up the sole LCC player on the Brazil-US market if they can provide JB-like service (IFE, etc.) and very low fares.

I'd like to see if Spirit is contemplating longhaul any time soon since it has the feed out of some of its hubs (FLL) and it has a recognizable brand.

 

[Baronman]

I think you guys are completely disregarding the Brazilian market. This has everything to do with LAN-TAM and little to do with JB. In other words Azul's decisions are driven much more by their local market and competitor (TAM).