JetBlue lancia Mint, la business class sui voli transcontinentali (ora anche da BOS)


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Secondo alcune indiscrezioni originanti dalle autorizzazioni richieste da JetBlue alla FAA sulle configurazioni dei prossimi A321 della compagnia newyorkese, sembra ci sia l'intenzione di introdurre un prodotto simile in concetto alle suite che si trovano su Emirates o Singapore Airlines sui voli coast-to-coast negli USA.

***

Airbus filing to FAA reveals how JetBlue will offer mini-suites and class divider on A321s

June 6, 2013

Premium cabin privacy with a sliding door may no longer be the realm of long-haul international travel. It is no secret that JetBlue Airways is looking to step up in the premium transcon market but to date they have remained tight-lipped on details. In order to deviate from a typical seating arrangement it is necessary to receive an exemption from the FAA. Airbus, on behalf of JetBlue, has recently filed such a request, and it includes some details about how the cabin might be arranged.

“The cabin proposed for the Jet Blue Airlines A321 (U.S. operator) is a two class layout, with 16 business class seats and 143 economy class seats (159 passengers),” says Airbus.

This revelation alone is big news as it confirms that JetBlue will be moving to offer a formal split between its different cabins of service. The carrier’s current “Even More” option has additional legroom but that’s all. The newly described business class will be much more than that.

The filing continues:

“The Business Class includes 4 single seats that are ‘mini-suites’ types. These mini-suites consist in a seat with surrounding furniture’s, intending to provide privacy to the occupants. Typically, the complete closure of the single mini-suites is possible by means of a sliding element, moving parallel to the aircraft longitudinal axis.”

JetBlue intends to install seats providing the ultimate in passenger privacy on board its new A321 planes: suites with a sliding door.

In a statement the company confirms the seating plans while also noting that there is still more to come regarding the product:

“Thirteen years ago JetBlue revolutionized the economy experience and we will do the same with premium transcon. Our new onboard experience will enable us to compete with other airlines’ premium transcon products. While the FAA filing from Airbus contains the technical specifications as part of the certification process, all of the details including the branding and full experience will be revealed later this year.”

Progress at JetBlue has, for the most part, consisted of adding new features at the top end rather than reducing options at the bottom. When JetBlue added the Mosaic badge to their TrueBlue loyalty program, it did not remove benefits (e.g. one free checked bag) for other travelers; rather, it added more benefits for those more frequent customers. Putting three or four different levels of service in the A321 aircraft (mini-suites, business, economy and possible even more legroom) will add opportunity for a premium experience at the top end but, based on the seat count, should not take away from their industry-leading legroom for the rest of their customers.

For an airline which has focused since its founding on a more egalitarian approach to the in-flight product this change will be quite interesting to watch.

The addition of the premium product will allow JetBlue to compete for the high-yield traffic on transcontinental routes, a market where service levels and comfort have been improving dramatically of late. American Airlines will be offering flat-bed seats in both first class and business class on their A321 planes flying similar routes while Delta and United Airlines will have flat-bed business class seats.

For an airline which has focused since its founding on a more egalitarian approach to the in-flight product this change will be quite interesting to watch.

Copyright © 2011-2013, APEX. All rights reserved.
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

Molto interessante. Potrebbero pensare a qualcosa di simile ad esempio anche Qatar ed Etihad (quest'ultima sui 320)?
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

Sulla falsa riga di ciò che AA ha annunciato per la prima classe dei propri A321 transcon. I mercati JFK-SFO e JFK-LAX sono praticamente gli unici rimasti in USA ad attirare una quantità notevole di traffico premium.
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

^^

July 25, 2012
American Airlines is upgrading the product on its transcontinental routes, where its yields lag far behind those of United Airlines.

On two transcontinental routes, United’s passenger yields far outstrip the competition’s. On the route between New York John F. Kennedy International Airport (JFK) and San Francisco International Airport, United’s yields are 21.64 cents per mile, compared with American’s 13.72 cents, Delta Air Lines’ 10.90 cents, Virgin America’s 10.27 cents and JetBlue Airways’ 8.89 cents. On the JFK-Los Angeles route, United’s yields are 21.82 cents per mile, compared with American’s 17.08 cents, Delta’s 11.52 cents, Virgin America’s 10.88 cents, and JetBlue’s 8.84 cents, an Aviation Week analysis of data from Oliver Wyman’s PlaneStats.com shows.

But these are two high-load routes. In 2011, JetBlue’s load factors on the JFK-San Francisco route were 90.9%, compared with United’s 90.5%, Virgin America’s 88.2%, American’s 86.7% and Delta’s 85.7%. On JFK-Los Angeles, United’s loads were 89.7%, followed by American’s 88.2%. In this market, Virgin America and JetBlue both had 87.1% load factors, while Delta’s were 85.1%, the data show.

These factors–high-load markets in which American lags behind its competition—could explain why the airline plans to upgrade its product on its transcontinental routes.

The carrier next year will begin taking delivery of Airbus A321s in a three-class configuration, including 10 lie-flat first-class seats and 20 lie-flat business-class seats. The main cabin will be divided between 36 premium economy seats and 36 standard economy seats. In addition, the aircraft will have upgraded inflight entertainment systems in all three classes.
Clicca per espandere...
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

kenadams ha detto:
Sulla falsa riga di ciò che AA ha annunciato per la prima classe dei propri A321 transcon. I mercati JFK-SFO e JFK-LAX sono praticamente gli unici rimasti in USA ad attirare una quantità notevole di traffico premium.
Clicca per espandere...

Beh, sui voli eastbound la possibilita' di dormire comodamente e' un game-changer: ti consente di partire all'ora di cena dalla west coast ed arrivare all'ora di colazione sulla east coast.
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

uncomfortable ha detto:
Beh, sui voli eastbound la possibilita' di dormire comodamente e' un game-changer: ti consente di partire all'ora di cena dalla west coast ed arrivare all'ora di colazione sulla east coast.
Clicca per espandere...

Non è poi tanto semplice: quella comodità ci sarebbe anche sui voli eastbound da LAX e SFO per BOS, CLT, EWR, IAD, MIA, PHL - eppure la concorrenza e gli yield producono queste configurazioni speciali solo per JFK.
 
Re: JetBlue vuole introdurre suite sui voli transcontinentali USA?

Io pero non ho capito con quella configurazione in cabina come fa il pax lato finestrino a uscire per andare al bagno mentre l'alto dorme.
 
Nuova cabina di business class per JetBlue

[h=1]Inside JetBlue's First-Ever Business-Class Cabin[/h]By Justin Bachman June 10, 2014

0610_jetblue_mint_970-630x420.jpg
Photograph by PRNewsfoto via AP Photo​
JetBlue Mint front row

The most lucrative airline route in America—New York to Los Angeles—is about to get a new business-class carrier: JetBlue Airways (JBLU), better known for spacious coach seats and free blue potato chips.
The airline’s new premium cabin, dubbed Mint, makes its debut Sunday morning for a Los Angeles-bound flight on the first of 11 larger planes that will form the backbone of JetBlue’s bid for the business elite shuttling between coasts. The Mint flights will expand to San Francisco in October. JetBlue is hoping to spur new demand among lower-end business travelers who don’t want to spend the thousands of dollars first- and business-class seats command on the other domestic airlines flying nonstop between New York and California. If it works, the Mint cabin is likely to be added to JetBlue’s transcontinental flights from Boston in 2015.
0610_jetblue_mint_inline01_630.jpg
Courtesy JetBlue​
The 16 lie-flat premium seats on each Airbus A321 cost from $599 to $999 for a one-way flight, and it’s likely that JetBlue will raise those prices over time as travelers become familiar with Mint. “It can bear a lot more,” Jamie Perry, JetBlue’s director of product development, says of Mint’s prices. “That doesn’t mean we can charge it.”
VIDEO: Design Secrets of Luxury First-Class Airline Seats
For years, JetBlue has shuttled passengers from its New York-JFK Airport base to California with only a coach cabin. During that time, rival airlines began staging anamenities arms race to lure corporate customers and wealthy travelers—the people for whom a $7,000 round-trip flight isn’t prohibitive.
In a search for a one-way, business-class flight from JFK to LAX on Aug. 22, JetBlue’s Mint seat was lowest at $599, followed by Delta’s (DAL) $799 offering. Premium fares from United (UAL) and American (AAL) both exceeded $1,000, and Virgin America sought $1,419 for a first-class seat. The most expensive fare, a first-class seat on American’s new A321s, carried a $2,925 price tag.
0610_jetblue_mint_inline02_630.jpg
Courtesy JetBlue​
Those are the kinds of fares JetBlue thinks Mint can disrupt. And with only 176 premium seats in its fleet so far, the revenue experiment doesn’t require an enormous investment. The airline is also hoping to collect more revenue from its cabin because it will sell all the seats and avoid the upgrades doled out by larger airlines such as American and Delta.
STORY: Etihad's New Three-Room Suite, for When First Class Just Doesn't Cut It
Of greater note to the flying masses will be the slimmer leather seats JetBlue has introduced on the A321s, which will also extend to its fleet of A320s. The configuration puts each seat an inch closer together, packing more people on the plane. But there’s good news for the non-Mint travelers too: The more cramped conditions come with free high-speed Internet and a 10.1-inch touchscreen monitor, far larger than the 6-inch screen on current JetBlue seats. The airline is testing the touchscreen this year, Perry says, and ultimately hopes to remove the screen controller in the seat armrests.
0610_jetblue_mint_inline03_630.jpg

JetBlue held a brunch for reporters Tuesday aboard the first new plane. In keeping with the airline’s custom of cute names, the A321 had been was called “It’s Mint to Be.” The menu in-flight in the premium cabin begins with a honey-infused limeade served with or without vodka, and, of course, a fresh sprig of mint. The menu continues with an amuse-bouche of goat cheese, peppers, and cucumbers and five tapas-style dishes paired with a five-bottle wine list, a half-dozen beers, and five liquors.
The company has spent months training flight attendants who will staff the new cabin and tweaking the menus, which were devised with help from the Manhattan restaurant Saxon + Parole. About 140 flight attendants will be trained to work the Mint cabins this year.
VIDEO: JetBlue Finds Pricing 'Sweet Spot' in First-Class
The dark leather seats have a BMW look and extend into flat beds that are 6-feet-8 inches long. The seating arrangement places a single seat between rows of two, allowing more privacy for solo travelers. Those single seats offer a small “privacy door” that can be closed while sleeping. JetBlue also installed a “sleep service” button so a Mint passenger can advise the crew that she’d like to be woken for meals and drinks.
Will the new cabin work financially? Can JetBlue’s value-conscious appeal—friendly staff, nice product, reasonable prices—attract people who might spring for an $800 ticket as opposed to a $400 seat in coach? Analysts are divided on Mint’s chances for success. Skeptics point to the higher costs and the frequent-flyer programs keeping many regular business travelers wedded to the bigger airlines.
0610_jetblue_mint_inline04_630.jpg
Courtesy JetBlue​
In a recent client note, Cowen analyst Helane Becker called Mint “mysterious” because each seat in the cabin occupies the same space as three JetBlue coach seats—a strategy that raises operating costs. “It will be interesting to see how this product evolves,” she wrote.


 
Re: Nuova cabina di business class per JetBlue

[h=4]Features:[/h]
  • A world-class seat with movable headrests
  • A custom seatback design with drink holder
  • Brand new entertainment system with a 10" video screen
  • Up to 100 free channels of DirecTV® and 100+ channels of SiriusXM® Radio*
  • In-seat power access from every seat
  • Plus, access to Fly-Fi, the at-home internet experience at altitude
CoreExperience1.jpg
CoreExperience2.jpg
CoreExperience3.jpg
CoreExperience4.jpg
[h=3]The new, enhanced transcontinental experience[/h][h=4]Features:[/h]
JetBlue-Mint-logo.png

  • A fully-customized seat design for a one-of-a-kind experience
  • Fully lie-flat seats with a bed length of 6'8"
  • The first and only suite with closable door in the domestic U.S. market
  • Air cushions with adjustable firmness
  • Massage feature
  • Brand new entertainment system with a 15" video screen
Learn more about the Mint experience here.
EnhancedExperience1.jpg
EnhancedExperience2.jpg
EnhancedExperience3.jpg
EnhancedExperience4.jpg
EnhancedExperience5.jpg
EnhancedExperience6.jpg




A321.jpg



[h=2]Airbus 321[/h][h=3]The transcontinental experience[/h]The Airbus A321 is the newest member of the JetBlue fleet. As the bigger sister of our popular A320 aircraft, the fuselage has been made longer to accommodate additional customers.
We are pleased to introduce JetBlue's new cabin interiors on our A321 aircraft. We are making a number of enhancements to the core JetBlue Experience, which the industry calls "economy," because the best just wasn't good enough. We are also introducing a coast-to-coast experience that will compete with other airlines' first and business class. There will be 143 seats in the core JetBlue Experience and 16 seats in the new, enhanced experience, four of which are private suites. Each suite offers a closing door and is a first in the domestic U.S. market. JetBlue's A321s in this configuration will fly between New York/Los Angeles and New York/San Francisco starting in the second quarter of 2014.
chart-a321-transcontinental.gif

orangesquare.gif
Denotes Even More Space seat
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Suite
[TABLE="class: zebra"]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seats:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]143 core JetBlue Experience seats; 16 enhanced transcon experience seats, 4 of which are private suites with closable door[/TD]
[/TR]
[TR]
[TD]Even More Space rows:[/TD]
[TD]6-10, 18-19[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat configuration:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]29 rows; three-by-three in the core JetBlue Experience; staggered two-by-two and one-by-one in the enhanced transcon experience[/TD]
[/TR]
[TR]
[TD]Seat pitch:[/TD]
[TD]33" in the core JetBlue Experience; 37"-41" in Even More Space[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Cabin height:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]7 feet 1 inch[/TD]
[/TR]
[TR]
[TD]Bathrooms:[/TD]
[TD]Four; two in the back, one in the front, and one mid-cabin[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Length:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]146 feet[/TD]
[/TR]
[TR]
[TD]Wingspan:[/TD]
[TD]115 feet 5 inches (with sharklets)[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Range:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Up to 3,200nm/5,950km[/TD]
[/TR]
[TR]
[TD]Engines:[/TD]
[TD]Two IAE V2533-A5[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Inflight entertainment:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]DirecTV®*, SiriusXM Radio®*, JetBlue Features**[/TD]
[/TR]
[/TABLE]



[h=3]The core JetBlue Experience[/h]The Airbus A321 is the newest member of the JetBlue fleet. As the bigger sister of our popular A320 aircraft, the fuselage has been made longer to accommodate additional customers.
This configuration exclusively offers the core JetBlue Experience with 190 seats in the typical three-by-three layout. The aircraft will also feature JetBlue's refreshed onboard experience including a world-class seat design with movable headrests, a brand-new entertainment system with 10.1" widescreens, and up to 100 channels of DirecTV® programming*.
chart-a321-core.gif

orangesquare.gif
Denotes Even More Space seat
[TABLE="class: zebra"]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seats:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]190[/TD]
[/TR]
[TR]
[TD]Even More Space rows:[/TD]
[TD]1, 10-13, 22-23[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat configuration:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]32 rows; three-by-three[/TD]
[/TR]
[TR]
[TD]Seat pitch:[/TD]
[TD]33" in the core JetBlue Experience; 37"-41" in Even More Space[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Cabin height:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]7 feet 1 inch[/TD]
[/TR]
[TR]
[TD]Bathrooms:[/TD]
[TD]Four; three in the back and one in the front[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Length:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]146 feet[/TD]
[/TR]
[TR]
[TD]Wingspan:[/TD]
[TD]115 feet 5 inches (with sharklets)[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Range:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Up to 3,200nm/5,950km[/TD]
[/TR]
[TR]
[TD]Engines:[/TD]
[TD]Two IAE V2533-A5[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Inflight entertainment:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]DirecTV®*, SiriusXM Radio®*, JetBlue Features**[/TD]
[/TR]
[/TABLE]





[h=2]Airbus 320[/h]With the widest fuselage of any single-aisle aircraft, the Airbus A320 offers wider seats and aisles plus large overhead bins. With the most legroom in coach1 plus Even More Space seats for those looking for more room to stretch out, our A320s are one of the most comfortable rides out there.
Our A320s are configured with 150 comfy leather seats, in a three-by-three layout. All seats are equipped with our inflight entertainment system, offering 36 channels of DIRECTV, and 100+ channels of XM Radio*. We also offer new released movies on JetBlue Features on flights longer than two hours.
chart-a3202.gif

orangesquare.gif
Denotes Even More Space seat
[TABLE="class: zebra"]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seats:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]150[/TD]
[/TR]
[TR]
[TD]Even More Space rows:[/TD]
[TD]1-5, 10, 11[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat configuration:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]25 rows, three-by-three[/TD]
[/TR]
[TR]
[TD]Seat pitch:[/TD]
[TD]34" in the core JetBlue Experience; 38"-39" in Even More Space[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat width:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]17.8 inches[/TD]
[/TR]
[TR]
[TD]Cabin height:[/TD]
[TD]7 feet 1 inch[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Bathrooms:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Three; two in the back and one in the front[/TD]
[/TR]
[TR]
[TD]Length:[/TD]
[TD]123 feet 3 inches[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Wingspan:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]111 feet 10 inches[/TD]
[/TR]
[TR]
[TD]Range:[/TD]
[TD]2,700 nautical miles[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Engines:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Two IAE V2527-A5[/TD]
[/TR]
[TR]
[TD]Inflight entertainment:[/TD]
[TD]DirecTV®*, SiriusXM Radio®*, JetBlue Features**[/TD]
[/TR]
[/TABLE]


a320.jpg







[h=2]Embraer 190[/h]With its unique "double bubble" fuselage, the Embraer 190 (E190) offers customers one of the most spacious and relaxing cabins in its class.
Our E190s are configured with 100 comfy leather seats in a two-by-two layout, which means customers have either an aisle or a window seat. Even More Space seats, offering additional legroom, are also available on the E190. All seats are equipped with our inflight entertainment system, offering 36 channels of DIRECTV and 100+ channels of SiriusXM Radio*. We also offer new released movies on JetBlue Features on flights longer than two hours.
chart-e1902.gif

orangesquare.gif
Denotes Even More Space seat
[TABLE="class: zebra"]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seats:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]100[/TD]
[/TR]
[TR]
[TD]Even More Space rows:[/TD]
[TD]1, 12-14[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat configuration:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]25 rows; two-by-two[/TD]
[/TR]
[TR]
[TD]Seat pitch:[/TD]
[TD]32" in the core JetBlue Experience; 39" in Even More Space[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Seat width:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]18.25 inches[/TD]
[/TR]
[TR]
[TD]Cabin height:[/TD]
[TD]6 feet 7 inches[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Bathrooms:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Two; one in the front and one in the back[/TD]
[/TR]
[TR]
[TD]Length:[/TD]
[TD]118 feet 11 inches[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Wingspan:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]94 feet 3 inches[/TD]
[/TR]
[TR]
[TD]Range:[/TD]
[TD]2,100 nautical miles[/TD]
[/TR]
[TR]
[TD="class: blue, bgcolor: #F1F5F8"]Engines:[/TD]
[TD="class: blue, bgcolor: #F1F5F8"]Two GE CF34-10E[/TD]
[/TR]
[TR]
[TD]Inflight entertainment:[/TD]
[TD]DirecTV®*, SiriusXM Radio®*, JetBlue Features**[/TD]
[/TR]
[/TABLE]
1 Most legroom in coach based on avg. fleet-wide seat pitch of U.S. airlines.
* DIRECTV and SiriusXM Radio™ service is not available on flights outside the contiguous U.S.; however, where applicable, movies from JetBlue Features are offered complimentary on these routes.
** JetBlue Features premium entertainment on flights longer than two hours



 
Re: Nuova cabina di business class per JetBlue

Posto qui...

JetBlue Airways Reports May 2014 Traffic

NEW YORK, NY — (Marketwired) — 06/11/14 — JetBlue Airways Corporation (NASDAQ: JBLU) reported its preliminary traffic results for May 2014. Traffic in May increased 7.0 percent from May 2013, on a capacity increase of 7.0 percent.

Load factor for May 2014 was 85.2 percent, an increase of 0.1 points from May 2013. JetBlue’s preliminary completion factor was 97.6 percent and its on-time (1) performance was 77.3 percent. JetBlue’s preliminary passenger revenue per available seat mile (PRASM) for the month of May increased four percent year over year. For the second quarter of 2014, PRASM is expected to increase between six and seven percent year over year.
 
Re: Nuova cabina di business class per JetBlue

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[h=1]JetBlue Airways faces tough challenges even as its Mint offering drives fresh innovation[/h]

jetblue_logo-200x.png

Underlying JetBlue’s official debut of its highly anticipated Mint premium product is growing shareholder impatience for a timeframe of anticipated rewards and perhaps a high level leadership change as the financial markets at large look for improving revenue and lower costs at the airline.

With the new Mint offering, JetBlue continues its history of carving out new products within the airline market place. But at times frustration can accompany innovation as investors look for quick returns. In tandem with seeking returns, JetBlue’s investors are also awaiting a leveling off of the airline’s unit costs excluding fuel. After battling cost creep for the better part of two years, JetBlue is hesitating from providing a clear cut timeline of when its costs will normalise.

Even as Mint offers JetBlue a new level of product distinction, scrutiny is growing over the airline’s financial performance, and whether it will meet its declared intention of delivering a return on invested capital (ROIC) of 7% during CY2014.



[h=2]JetBlue aims to shave costs while attempting to explain its business model[/h]Memories of JetBlue’s financial performance during CY2013 – the most profitable year in the airline’s 14 year history – faded fast as the cost overhang it has experienced during the past couple of years remains intact.

The airline forecasts unit cost growth of 3.5% to 5.5% during CY2014 driven mostly by labour costs. JetBlue has reached an agreement with pilots that includes a 20% increase in base pay during the next three years, for a collective total costs of USD145 million through 2016. Its pilots also recently elected for union representation, so the outcome of a negotiated collective bargaining agreement under the leadership of JetBlue’s ALPA unit could create more labour costs headwinds for the airline.

See related report: JetBlue builds its network strength as cost headwinds strengthen
JetBlue continues to stress that in many ways its unit costs reflect how it has chosen to position itself within the North American market place – a medium frills carrier targeting a passenger segment seeking more comfort than provided by ultra low-cost carriers, but at a lower price point than global network airlines. The airline estimates its roughly USD8 cent unit cost excluding fuel and profit sharing for 1Q2014 was in the middle of ultra low-cost airlines and full-service global network airlines.
JetBlue 1Q2014 unit costs versus ULCCs and US network carriers
unitcosts.png

Source: JetBlue
* Mainline stage-length adjusted ex-fuel CASM and profit sharing to 1,000 miles from AAL, ALGT, ALK, DAL, JBLU, LUV, SAVE, UAL for quarter ended 31-Mar- 2014
[h=2]Mint may be somewhat low risk; but its revenue prospects remain uncertain[/h]Perhaps one of JetBlue’s most ambitious projects to showcase its hybrid model is the new Mint premium product it recently debuted on US transcontinental service from New York JFK to Los Angeles. Mint makes its debut on JFK-San Francisco service in Oct-2014.

JetBlue is equipping 11 Airbus A321s with 16 flat bed seats, four of which are closed off private suites. The creation and development of Mint was fostered by JetBlue’s conclusion that it was at a revenue disadvantage on those routes due to a lack of premium product to attract higher yielding customers. Previously, JetBlue has estimated that revenue from JFK to Los Angeles and San Francisco is 50% higher than other routes within the US.

See related report: JetBlue Airways further evolves its hybrid strategy and takes a gamble with new premium cabins
The airline’s pricing for its new Mint product – as low as USD599 one way – is designed to appeal to the higher end leisure traveller or small business owner looking for a more upscale experience at a reasonable price. The exact size of that passenger segment remains unknown, and with American, United and Delta all offering a new premium product on those same transcontinental routes featuring lie-flat seats, the success of Mint is uncertain.

But with just a fraction of its Airbus fleet featuring the new product, perhaps JetBlue is attempting to create a new premium experience from a lower risk profile. Once all 11 aircraft featuring the Mint product are in service, the total Mint seat count across the 11 jets will be 176. According to CAPA’s fleet database, JetBlue has a total of 76 Airbus A321s on order (30 NEOs and 46 current generation jets), and the number of Mint jets will represent roughly 14% of the airline’s A321 fleet once all aircraft deliveries are completed.
JetBlue's fleet summary as of 18-Jun-2014
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Source: CAPA Fleet Database
JetBlue has not quantified its investment in Mint; but even as the overall number of Mint seats represent just a fraction of the airline’s total capacity, the spend on other elements of the Mint experience – food and flight attendant training – are likely to create some unit revenue pressure in CY2014 as JetBlue works to get the product up to scale.
[h=2]JetBlue sees improved revenue trends in 2Q2014, but also growing costs[/h]After battling winter storms that wreaked havoc on all carriers, JetBlue posted unit revenue growth of just 1.1% in 1Q2014. With it main base of operations in JFK and an ample amount of its operations centred on the US east coast, JetBlue arguably had somewhat of a disadvantage in combating the effects created by the flight cancellations and disruptions.

See related report: JetBlue Airways’ hybrid model remains enigmatic as cost creep outpaces revenue production

But JetBlue’s passenger unit revenues increased just 2.3% in CY2013 as unit costs excluding fuel grew 3.8% year-on-year. Given JetBlue’s unit cost estimates of a 3.5% to 5.5% increase in CY2014, the airline needs some revenue momentum to create a better cost/revenue scenario.

Prospects for 2Q2014 look encouraging as unit revenues at JetBlue increased 11% year-on-year in Apr-2014 and 4% in May-2014. Part of April’s marked rise is the shift of the Easter holiday from Mar-2013 to Apr-2014, but nonetheless it does bode well for JetBlue. With a projected unit cost rise of 4.5% to 6.5% in 2Q2014, JetBlue is likely to find itself stuck with unit cost growth outpacing unit revenue growth. And arguably, with Mint representing just a small fraction of JetBlue’s operations in CY2014, its revenue contribution will be negligible.
[h=2]JetBlue’s top-line revenue and expense growth slows in CY2013[/h]JetBlue’s recorded roughly 9% growth in its operating revenue during CY2013 compared with a 19% jump in CY2011, which is not exactly the trajectory investors like to see for an airline that still declares itself as a growth company.
JetBlue Airways annual operating revenue growth: CY2011 to CY2013
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Source: CAPA - Centre for Aviation and airline reports
But while the airline continues to face unit cost headwinds, its top-line operating expenses slowed to almost 9% in CY2013 after soaring 21% in CY2011. Its USD5.4 billion in operating revenue did outpace its USD5 billion in top-line expenses for CY2013, creating positive momentum for JetBlue’s operating income, which grew nearly 14% year-on-year in CY2013, down from nearly 17% growth in CY2012.
JetBlue Airways annual growth in operating costs: CY2011 to CY2013
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Source: CAPA-Centre for Aviation and airline reports
JetBlue Airways annual operating profit (loss) growth: CY2011 to CY2013
jbluoprev.png

Source: CAPA-Centre for Aviation and airline reports
[h=2]JetBlue’s lack of shareholder returns is possibly causing a management shake-up[/h]JetBlue has been a publicly traded company for about 12 years; but has never issued any dividends to stockholders. It has engaged in share buyback programmes, but it seems some of the airline’s investors are becoming more vocal about returns, prompting questions regarding a leadership change at the company.

Its chief operating officer departed earlier in 2014 and a recent article in The Wall Street Journal prompted questions over the fate of CEO Dave Barger once his contract ends in Feb-2015. Also in 2014 JetBlue’s chief commercial officer Robin Hayes has been elevated to the role of president.

It remains unclear if Mr Barger is feeling pressure to step down; but it does appear that sentiment is growing among shareholders that they deserve a higher level of rewards, and a timeline for when increasing rewards should be delivered.
[h=2]Continuing cost pressure dampens JetBlue’s mid-market promise[/h]For all the positive buzz Mint’s debut is generating, the challenges facing JetBlue remain firmly intact – getting its unit cost under control, achieving its ROIC targets after missing its goals in CY2013 and dealing with a newly unionised pilot workforce.

JetBlue has undoubtedly charted new territory in the US airline business with its mid-market offering that is built on creating added value products rather than stripping amenities away from passengers.
But the returns on the investments that JetBlue has made to distinguish its business model have been slow to materialise as its costs have remained stubbornly high. Until its costs stabilise, it could be difficult to deem its strategy a complete success. The signs are relatively benign, but the case is yet to be proven.
 
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