Failed Business Model

[DOMB]

Simple math - even at 100% load factor (which is not possible) revenue can't support.. Landing Fees, Crew Costs, Fuel, Insurance, Maint costs, gate charges, plus everything else.. Peoples express failed & they only spent 3 millon (per plane) for used aircraft .. not $40 Plus million - The "shell" game ends when they have to actually pay for the equipment, when manufactures maint. support runs out, when there fleet actually needs to be maintaineed. With the exception of Southwest, modern Airline History, since deregulation is littered with examples of this failed business model..
Jetblue is just another example of a management team focused on doing the same thing everyone else has done and expecting a different result.

 

[Blue Dude]

Not even worth the time it would take to rebut. Too bad you had to waste your first post on this.

 

[Flying Titan]

DOMB -
It's hard to take this thread very seriously since you offer only general rants and don't explain why their costs would be higher than other carriers. In fact, JetBlue consistently has the lowest seat-mile cost in the industry. A high percentage of transcon flights and NE to Florida flights, with their long stage lengths, contribute to these low costs. On several routes, JetBlue is actually receiving a higher average fare than other airlines - especially NYC to Florida markets. So if their costs are lower and their average fare is higher on some of their most-traveled routes, then where is the problem? Perhaps this could be why JetBlue is consistently profitable.

By the way, JetBlue does pay for their planes, though it's widely understood that as the first LCC to go with the A320, they received a very good deal. Sounds like smart negotiating and good management to me. As for maintenance, just like when you buy a new car, you expect a warranty. Their first aircraft are going through heavy checks now in El Salvador, if I'm not mistaken, and I don't think that work is being done for free. So much for not paying for their equipment.

 

[CaptianBoomer]

I am continually surprised that people actually think JB doesn't pay for planes.

The coup was when JB management convinced John Owen to defect from SWA.

Owen has bought or leased every jet SWA ever had.....he know the tricks of the trade and how to manage this very capital intensive business. I don't know how they did it, but they convinced him to go with JB.

In fact, a majority of JB's planes are owned. When it makes sense to lease, they do.


DOMB...has it occurred to you that PeopleExpress has how many aircraft types and bought tired old 747's to fly around the world???? They overexpanded and it was the majors crowding them out of the markets that made them unprofitable. Today it is a different animal. Fuel and inefficiency is what is killing the legacy airlines, of course that combined with too many seats chasing too few break even paying customers.


Boomer

 

[CruiseO]

Ah what the heck...Domb just joined yesterday and this was his/her first post. Nice effort. [That was sarcasm for those too Domb to figure it out.]

 

[PRINCESS KIDAGAKASH]

By the way, JetBlue does pay for their planes, though it's widely understood that as the first LCC to go with the A320, they received a very good deal.



Actually, the first LCC to buy the A320 was BRANIFF 2 in 1988. BRANIFF took over PANAM's A320 orders(50 planes) when PANAM couldn't pay for them. It was BRANIFF that got the A320 certified in the USA for airline use. It took FOUR attempts to get the FAA to certify the A320, and was one of the main reasons BRANIFF 2 went out of business.

 

[mga707]

By the way, JetBlue does pay for their planes, though it's widely understood that as the first LCC to go with the A320, they received a very good deal.
Actually, the first LCC to buy the A320 was BRANIFF 2 in 1988. BRANIFF took over PANAM's A320 orders(50 planes) when PANAM couldn't pay for them. It was BRANIFF that got the A320 certified in the USA for airline use. It took FOUR attempts to get the FAA to certify the A320, and was one of the main reasons BRANIFF 2 went out of business.

[post="276524"][/post]​

Almost totally correct, except for the next-to-last sentence. BN was the second 320 operator in the US. When BN II took delivery of their first 320 in mid-89, Northwest already had a four or five 320s. IIRC, NW took deliver of their first example (in the old colors--think only the first one was ever painted as such) in early '89, some months before BN. Believe BN took delivery of five or six, and had three or four actually flying schedules, when they suddenly collapsed in the fall of '89. they all wound up with America West.
Good call, though, that they were actually the first of what now would be called an 'LCC' to operate the 320 in the USA.

 

[PRINCESS KIDAGAKASH]

Actually we are both correct. Northwest did receive in June 1989,their first A320(CFM-56 powered) a month before BRANIFF 2. Braniff's A320's were powered by,the then new,V2500 engine. Which may have contributed to Braniff's problems getting the airplane into revenue service. Braniff2 got only two into service and I believe had received another five before Braniff 2 folded in Sept. 1989. The paint scheme on the Braniff birds was very similar to the paint scheme being used today by Frontier, minus the animals on the tail.

 

[javaboy]

q1 05 jan/mar05 jan/mar04

Aircraft rent 17,813 17,255 3.2


from there you can figure out per plane payments,

also airlines post (sec documents), average fare, load factors, breakeven load factors, all kinds of data to be mined. little bit of boring research shows, not only are they paying for thier planes, but how much per gal of fuel they paid, ave stage length, ac utilization per day and alot more.

😛h34r:

 

[markkus757]

Someone forgot to mention that NW's first few A320s were actually ordered by US when they chose Airbus instead on 737NG. They could not be guaranteed earlier production slots from Boeing, so they went Airbus instead. While wrangling over contract issues with the pay rates, they had to defer a significant portion of their initial deliveries, and NW and BMI took the first planes for them.