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Why i$ B6 Getting $o Expen$ive?

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Old May 7, 2008, 9:30 am
  #1  
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Why i$ B6 Getting $o Expen$ive?

As a current UA 1K, United has been offering many attractive fares out of LAX (to SEA $189, ORD$239, JFK$299, FLL$219, etc). I am thinking about cutting down my travel significantly (thereby throwing away my elite status ) and switch to B6 next year....but I'm seeing B6 charging 300-500 for these same destinations out of LGB while UA, AA, and other legacy airlines continue to beat B6 in prices. What gives? Are people paying more $ to fly low cost airlines now?
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Old May 7, 2008, 9:53 am
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I'm guessing that the reason that flying B6 is getting so expensive is the same one affecting all airlines: jet fuel that's flirting with $4/gal.

Unless fuel prices come down (in a big way), ALL flying is gonna get a lot more expensive unless new investors can be convinced to subsidize cheap tickets.

jetBlue was dreamed up by Soros and Neeleman when jetA was selling for about $0.55/gal. Not so sure the fares can be low when it's almost $4/gal.
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Old May 7, 2008, 10:39 am
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I'm guessing B6 is more expensive because they've tried raising the fares and the planes are still full enough... so perhaps the question is "why would people pay more to fly B6?"

For me flying from SEA, there aren't all that many other nonstops to BOS and JFK, and between the convenience of the TV and the fact that it seems quicker to earn a usable free ticket, I'd probably pay 10-20% extra to fly it...

(now, I priced one itinerary for December 2008, and B6 was $878 roundtrip, compared to AS at $602, which did scare me off.)
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Old May 7, 2008, 10:50 am
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Indeed. Was pricing flights for a weekend in late August, NYC-SEA. On the non-stops, jetBlue has the highest fare:

AA $436
AS $436
CO $441
DL $441
B6 $531
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Old May 7, 2008, 11:34 am
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If things don't cool down at the end of the peak Summer period (and I mean relative to the industry...where I still expect priced to be higher than last year) I will probably just defect to Delta. I am almost at 100 points, so I would top it off and be done with B6 for a long time.
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Old May 7, 2008, 11:43 am
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The short answer is YES. People are paying more to fly on jetBlue than on the legacy carriers. I only know one person that has stuck with United this year. He is tired of UA but is 1K and his company travel department has not yet discovered jetBlue and Virgin America. All of my co-workers, the other people in the building , friends, etc. have all switched to jetBlue or Virgin America to get from the Bay Area/LA area to New York. The planes are new, the service is much better, jetBlue makes it much easier to change a ticket. PLEASE REDUCE THE CHANGE FEE though. United is offering lower fares now because they need cash quickly. They just had another $250 million added to restricted cash and paid out $100million plus to change their loan terms for the next 10 1/2 months. American has its share of service issues. Delta will be preoccupied with their merger and US Airways is well US Airways.
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Old May 7, 2008, 11:46 am
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JetBlue charged lower fares because for the first several years of their leases with Airbus, they did not have to pay. So they tried to gain as much market share as possible. Now that they are paying for aircraft leases, obviously they can no longer undercut the competition, so their fares have risen dramatically.
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Old May 7, 2008, 11:52 am
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The reality is that service levels at the legacy carriers are at such a low point that jetBlue offers a much better coach product than any of the legacy carriers. Even CO which is well run offers NO legroom in coach. If you offer a better product there is no need to charge a price which does not cover your costs.
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Old May 7, 2008, 11:59 am
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Originally Posted by dh01
JetBlue charged lower fares because for the first several years of their leases with Airbus, they did not have to pay. So they tried to gain as much market share as possible. Now that they are paying for aircraft leases, obviously they can no longer undercut the competition, so their fares have risen dramatically.
An oft-repeated urban legend, I'm afraid.

B6 had a maintenance holiday of sorts with its new, under-warranty A320s which is now disappearing since its five year new plane warranties are expiring, but it has not been given lease-free airplanes.
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Old May 7, 2008, 12:08 pm
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B6 has somehow kept the impression going that it's an LCC, but comparatively speaking it's in no way an LCC... much of the time, it's a PCC (premium cost carrier) pitching fares 25%+ above legacy carriers.

I've been pricing an August SEA-BOS-SEA for my family, and while JetBlue is everyone's preferred choice, it's far from the cheapest:

CO $430
Airtran $457
AA $480
US/CO $506
B6 $530

Maybe it's down to less sophisticated yield management at B6, but whatever the reason, JetBlue is expensive.
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Old May 7, 2008, 1:30 pm
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Some are higher some are LOWER. Maybe other carriers offer more flights and therefore have more cheap seats available or something.

JFK-SLC 9/4 - 9/7
B6 349 all-in
DL 379 all-in
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Old May 7, 2008, 1:33 pm
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Maybe B6's strategy was/is to build such a level of brand awareness, preference (and loyalty)? that enough people will just book and buy B6 without even checking fares of other airlines.
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Old May 7, 2008, 2:15 pm
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Originally Posted by FWAAA
An oft-repeated urban legend, I'm afraid.

B6 had a maintenance holiday of sorts with its new, under-warranty A320s which is now disappearing since its five year new plane warranties are expiring, but it has not been given lease-free airplanes.
And B6 is trading out some of the A320s as they age - and before the maintenance costs catch up to them - while they take in new A320s. They're keeping the maintenance costs low by dumping some of the planes before they actually need a major check performed. Not all of the A320s are treated this way, but a couple are each year.

Load factors are remaining pretty high, while fares are going up. That is good for the company but not for the passenger looking for the cheap flight.

As for comparing a single weekend trip to determine which carrier charges more, it is a fool's errand. Picking a random weekend is not a representative sample size (nowhere close, really) and doesn't make sense to use as a barometer of fares between carriers.
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Old May 7, 2008, 5:55 pm
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Originally Posted by sbm12
Load factors are remaining pretty high, while fares are going up. That is good for the company but not for the passenger looking for the cheap flight.
What are "high" load factors? More than 80%?
And, below what load factor would the flight be axed? Less than 60%?
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Old May 7, 2008, 5:59 pm
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Originally Posted by dieuwer2
What are "high" load factors? More than 80%?
Depends on the flight. 80% isn't usually considered bad.

And, below what load factor would the flight be axed? Less than 60%?
Again, flight specific. Some flights operate such that the BELF is 80%. Some operate such that the BELF is much lower.
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