JetBlue Aims to Expand Partnership With American
http://online.wsj.com/article/SB10001424127887324178904578340040429190864.html
http://online.wsj.com/article/SB10001424127887324178904578340040429190864.html
JetBlue Aims to Expand Partnership With American
- Thread starter usa1
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1AA
Veteran
Oh my Christ....usa 1, ... you putting Info like T H A T out in public could Damm well (God Forbid) cause World Traveler to have a MASSIVE Coronary !!!!!!!!!!!!
Methinks Ol' Jet Blue is reading the Tea Leaves, and does NOT like what they see down the road.
HEY, WAIT.
Why wouldn't B6 want to do the same thing with DEL-DUH ????
That makes sense, but it would be a really hard sell to the DOJ. I think the DOJ would really like to reject the AA/US merger, but in light of the previous two mega-mergers, they will be hard pressed to deny this one over ant-competitive reasons. Besides the fact that the government never really seemed to let US have anything without a years long fight. Even the gift to DL of all those LGA slots in return for a pittance was a difficult sell.
Can JetBlue join OneWorld? That would be a step in the right direction for them and for the new AA.
WorldTraveler
Corn Field
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Nothing will change the fact that B6 is the lowest CASM large jet carrier in the US. Neither AA or US hold the title of lowest CASM LEGACY carriers and AA/US are spending billions of dollars in the form of pay raises and integration costs in order to merge and will never be the lowest CASM legacy carrier.
It is impossible for B6's network to work under AA/US costs. If it did AA wouldn't have continued to exit markets over the past year, even while they were reaching the point of lowest costs in the BK process.
Nothing will also change the fact that there has been an enormous amount of new capacity added at LGA which his the preferred airport for short-haul traffic from NYC. A significant amount of B6's network is to markets which are now served by LGA with much more capacity and hub connectivity than those markets have had in the past - which is what has allowed B6 to add as much capacity in NYC as they have, which has all been challenged by the LGA slot deal.
Whether B6 ever joins oneworld or not doesn't change the fact that B6 cannot share revenue or have antitust immunity with another US domestic carrier in the domestic marketplace. The DOT doesn't permit it. For now, B6 will remain a competitor to all other US domestic airlines.
B6 just announced ORD-SJU indicating they will build their own network in markets where they believe they have the greatest opportunity to grow and take revenue from other carriers.
It is impossible for B6's network to work under AA/US costs. If it did AA wouldn't have continued to exit markets over the past year, even while they were reaching the point of lowest costs in the BK process.
Nothing will also change the fact that there has been an enormous amount of new capacity added at LGA which his the preferred airport for short-haul traffic from NYC. A significant amount of B6's network is to markets which are now served by LGA with much more capacity and hub connectivity than those markets have had in the past - which is what has allowed B6 to add as much capacity in NYC as they have, which has all been challenged by the LGA slot deal.
Whether B6 ever joins oneworld or not doesn't change the fact that B6 cannot share revenue or have antitust immunity with another US domestic carrier in the domestic marketplace. The DOT doesn't permit it. For now, B6 will remain a competitor to all other US domestic airlines.
B6 just announced ORD-SJU indicating they will build their own network in markets where they believe they have the greatest opportunity to grow and take revenue from other carriers.
JFK Fleet Service
Veteran
Extensive code share,mileage accrual and potentially joining Oneworld,anything else probably not even in the conversation.
WorldTraveler
Corn Field
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agreed. but other than for the local market, why would AA/US want to codeshare with B6 in connections that now can be served very well over PHL?
Further, history shows very clearly that B6 has used the revenues it gains from codesharing with AA to turn around and add even more service in AA competitive markets. I'm pretty sure that there are some folks in FT. Worth and Tempe who realize this whole B6 codeshare thing isn't doing anything to help - and providing a loaded gun to B6 that they can use on AA.
BOS-DFW, BOS-ORD, all kinds of Caribbean etc... and most recently ORD-SJU.....those are historically strong AA markets.
Further, history shows very clearly that B6 has used the revenues it gains from codesharing with AA to turn around and add even more service in AA competitive markets. I'm pretty sure that there are some folks in FT. Worth and Tempe who realize this whole B6 codeshare thing isn't doing anything to help - and providing a loaded gun to B6 that they can use on AA.
BOS-DFW, BOS-ORD, all kinds of Caribbean etc... and most recently ORD-SJU.....those are historically strong AA markets.
signals
Veteran
WorldTraveler
Corn Field
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siggie,
NYC is indeed a large market but it is not the goldmine for B6 that it once was. When B6 started, JFK had a lot of capacity and other carriers largely gave B6 a lot of room to grow. B6 also benefitted from the typical low costs of a new carrier, including low maintenance costs and very attractive deals on the 320s. But B6's fleet is aging and you can see in their financial results that maintenance costs are growing very rapidly. For 2012, B6' maintenance costs increased by $100M. Salaries also are increasing at a far faster rate than at other carriers, reflecting a more mature workforce.
http://investor.jetblue.com/phoenix.zhtml?c=131045&p=irol-newsArticle&ID=1778805&highlight=
Add in that the competitive situation in NYC is significantly more intense than it was a few years ago, and it isn't hard to see why B6' operating margins are falling. The LGA slot deal added a huge amount of capacity in short haul markets that are directly competitive w/ B6 at JFK - and data shows that there continues to be local NYC traffic that is moving back to LGA and other carriers.
B6 continues to look for opportunities in other markets, including BOS and to the Caribbean/Latin America and that is likely where they will find growth... but NYC is not going to be for B6 what it once was.
NYC is indeed a large market but it is not the goldmine for B6 that it once was. When B6 started, JFK had a lot of capacity and other carriers largely gave B6 a lot of room to grow. B6 also benefitted from the typical low costs of a new carrier, including low maintenance costs and very attractive deals on the 320s. But B6's fleet is aging and you can see in their financial results that maintenance costs are growing very rapidly. For 2012, B6' maintenance costs increased by $100M. Salaries also are increasing at a far faster rate than at other carriers, reflecting a more mature workforce.
http://investor.jetblue.com/phoenix.zhtml?c=131045&p=irol-newsArticle&ID=1778805&highlight=
Add in that the competitive situation in NYC is significantly more intense than it was a few years ago, and it isn't hard to see why B6' operating margins are falling. The LGA slot deal added a huge amount of capacity in short haul markets that are directly competitive w/ B6 at JFK - and data shows that there continues to be local NYC traffic that is moving back to LGA and other carriers.
B6 continues to look for opportunities in other markets, including BOS and to the Caribbean/Latin America and that is likely where they will find growth... but NYC is not going to be for B6 what it once was.
Yeah, but MY question still remains unanswered,....that being,......why wouldn't B6 want to do the 'deal' with DEL-DUH, that it wants to with AA.
ESPECIALLY where DL is The (supposed) GODFATHER in NYC ?
This B6 proposal..AMPLIFIES the word CURIOSITY to Extreme HEIGHTS !
ESPECIALLY where DL is The (supposed) GODFATHER in NYC ?
This B6 proposal..AMPLIFIES the word CURIOSITY to Extreme HEIGHTS !
WorldTraveler
Corn Field
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B6 and DL are aggressive competitors... I'm not sure what room is left after that concept sinks in.
CO grew freely at EWR in the 90s because AA and DL considered NYC a focus city and gateway while CO changed the paradigm of what NYC could be.
B6 set up shop at JFK because there was all kinds of unused space; again AA and DL - long time players in the NYC and NE market - did nothing to stop B6.
DL and B6 are aggressive competitors because DL decided to aggressively fight to establish a hub not only at JFK but also at LGA, which has a huge impact on what B6 does at JFK because many of B6's key markets can be flown from LGA, the preferred airport for short-haul travel from NYC.
AA/US has the ability to have a reasonably sized presence in LGA - but neither AA or US has historically been able to stand up to B6's low fares in some of the largest markets from NYC such as to Florida.
If AA/US can develop and maintain a decent presence of their own at LGA, they will be a threat to B6.
The notion that B6 can do something for AA or another US airline is baseless. B6 has succeeded in NYC to a large degree because other carriers have given them all kinds of room to grow.
Either AA/US can stop B6 and start retaking ground or B6 grows -but it comes at the expense of AA and US who have lost the most in NYC.
It shouldn't be too hard to figure out what the new AA needs to do - and if they do they will be no friend of AA's.
CO grew freely at EWR in the 90s because AA and DL considered NYC a focus city and gateway while CO changed the paradigm of what NYC could be.
B6 set up shop at JFK because there was all kinds of unused space; again AA and DL - long time players in the NYC and NE market - did nothing to stop B6.
DL and B6 are aggressive competitors because DL decided to aggressively fight to establish a hub not only at JFK but also at LGA, which has a huge impact on what B6 does at JFK because many of B6's key markets can be flown from LGA, the preferred airport for short-haul travel from NYC.
AA/US has the ability to have a reasonably sized presence in LGA - but neither AA or US has historically been able to stand up to B6's low fares in some of the largest markets from NYC such as to Florida.
If AA/US can develop and maintain a decent presence of their own at LGA, they will be a threat to B6.
The notion that B6 can do something for AA or another US airline is baseless. B6 has succeeded in NYC to a large degree because other carriers have given them all kinds of room to grow.
Either AA/US can stop B6 and start retaking ground or B6 grows -but it comes at the expense of AA and US who have lost the most in NYC.
It shouldn't be too hard to figure out what the new AA needs to do - and if they do they will be no friend of AA's.
I find it curious why there aren't any B6 employees posting on this thread.
B6, it would appear, has already seen its' best days.
B6, it would appear, has already seen its' best days.
WorldTraveler
Corn Field
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I don't think there is any correlation between whether employees of any airline post on this forum and the health of their company.
This forum is heavily focused on labor issues and B6 employees are not focused on those type of issues.
However, B6 succeeded as much as they did when they did because they found a niche that the network/legacy carriers could not or did not defend, particularly in the early 2000s. Now that NYC has become much more important for the network carriers, B6 does not have the same value in the marketplace it once had.
B6' execs recently talked about NYC by saying they appeal to passengers which the network carriers do not target.
This forum is heavily focused on labor issues and B6 employees are not focused on those type of issues.
However, B6 succeeded as much as they did when they did because they found a niche that the network/legacy carriers could not or did not defend, particularly in the early 2000s. Now that NYC has become much more important for the network carriers, B6 does not have the same value in the marketplace it once had.
B6' execs recently talked about NYC by saying they appeal to passengers which the network carriers do not target.
