Panam Clipper

Barger leaving JetBlue

http://fortune.com/2014/09/18/jetblu...r-to-take-off/

Robin Hayes to replace him.

Wall Street pleased, shares up 5% so far.

jspira

Until reading this story, I didn't know B6 was originally to be called "Taxi" - complete with yellow livery.

JetBlue CEO Barger to Retire
Above published recently (in our newsroom).

jeeden

Great. Writing is on the wall that the first thing the new CEO needs to do is raise all the fees he can like the other airlines or he is gone. Once he does that, the stock will pump, then the loads will drop as they will be just like any other airline, and they will all dump the stock leaving it all in shambles and taking the profits. I'm all for making shareholders money, but geez.

jeeden

yup..stock up 5% in after hours trading

bmg42000

Hopefully they will be exempt from the first bag fees. Maybe the can make money by selling the 'names ' on the jets themselves.

sfozrhfco

..or maybe they can continue to differentiate themselves and ignore the voices on Wall Street that have a very short term focus. It is quite easy to pump and dump a stock but in the process you will also destroy the value of the brand. Going the route of the legacies and ULCC would make jetBlue a very weak option--especially in the west where there is limited service on B6. I go out of my way to fly them now but would not do so if they start eroding the product and charging fees for every little thing.

bmg42000

If they switch to 29 inch seats then I will just switch to the legacies and go for the best deal. If they add checked bag fees then I will not switch (assuming I get a free luggage with the credit card (they can even raise the CC fee if I am getting a new benefit). With almost every other airline charging for backs it is going to be very hard for them to resist the pressure to do it . Would you want higher fares or check bags fees?

taxicabnumber

I really hope they'll do this, but far too many C-level executives' compensation structures these days are incentive-compatible with "pump and dump"...do we know how Hayes and co. will be compensated? (I might dig through jetBlue's 10K when I have some time; I'm curious about this)

What the "analysts" seem to ignore is the reasons people--especially the ever-coveted business traveler/HVF types -- wouldn't fly B6 if they aligned with every other airline. For example, in IRROPS, B6's lack of formal endorsement agreements with other major US carriers makes it a PITA if someone's travel plans are extremely time-sensitive; by contrast, look at Alaska (This is, I think, the biggest factor that analysts usually completely ignore). Further, the route network is limited compared to the legacies. I'm ignoring TrueBlue, although most on FT would never fly B6 for the sake of TrueBlue, because I don't claim to know how the average business traveler truly weights frequent flyer programs.

Given that most domestic business travel now seems to be booked in Y rather than J/F, if you downgrade the amenities to match "everyone else", what frequent traveler in their right mind would fly B6 except maybe someone who's BOS-based? As it is I'd imagine that B6 has a harder time than legacies at winning over people flying on OPM. Why shoot yourself in the foot?

jeeden

Yea, well like mentioned above. The shareholders don't care about 2+ years out. They care about within 2 years the profit they can make on the fees. By the time it all goes bad, they will have dumped the stock and moved on to the next thing.

Even if they figured out ways to make more profit by selling advertising on the planes or other non-passenger fee based revenue, the investors will still look at them and say "look at all the money we could be making if we did the fees the other airlines have!"

I don't see how they don't just pile on the fees. The new CEO must know that if he doesn't do it he is gone. He will cave to the pressure (not necessarily his fault), do all the fees, make investors money, bail before the downturn and he and the investors will move on to greener pastures.

For business I try JetBlue as much as possible, but usually have to go legacy. For my family though, I'm die hard JetBlue. If they go fee, I'll probably still go JetBlue for the entertainment and legroom (three kids and I'm 6'4") but I'll have to pick up an Amex Platinum to offset the baggage fees. We have a trip planned for Disney in June 2015 and the bags alone could be between $500- $1000 round trip for the family.

jeeden

real good article here along the lines of this thread...


http://www.thestreet.mobi/story/12885562/1/southwest-example-shows-wall-street-may-be-all-wrong-on-jetblue.html

sbm12

That's a lot of bags; how big is the family?? Many might not be free even with the current 1st bag policy.

As for the legroom, Wall Street wants them to jam more seats in, too. So that may go away as part of the plans. A shame, too, as they make good money selling EMS. Adding more seats means adding a lot more to justify the extra FA and that means likely fewer EMS sales.

jj1987

sheesh-- how many pairs of flip flops and shorts are you packing?

bmg42000

The E-190 already has 32 inch seat pitch (as compared to the 34 on A320). The A321 has a 33 inch seat pitch . So they have reduced it a little in the past . I think the free bags may be gone by next June, but adding more seats is a more difficult transition.

rtalk25

Adding a fee for first checked bag shouldn't be an end to the current jetBlue:
As far as the first checked bag fee, it's generally reimbursable by employers. If JetBlue is competing with United on BOS-Houston, or Delta on BOS-DTW, and these routes are flown with a lot of business travel pax, it's leaving money on the table, and letting competitors have an advantage on the route.

But squeezing in more rows is a game changer, and it will deteriorate the in flight experience. More rows will mean slimline seats at reduced pitch, legroom and no DirecTV, and it would have an impact especially for those long trips like transcons which is key in it's network. Why then fly JetBlue?

flyingmike

I am in BOS and fly most every week, mostly UA. I like B6 but despite having the most flights out of BOS it is often one per day at a lousy time. Example: They go direct to MSY, I am there every other month, but its a ~10:30 am departure landing at ~2:30 PM, so its an entire day spent just getting to a customer. UA I leave around 6:00 PM and land at 11:30 PM with a half dozen other options to/from.

Those direct flights also cost the most. BOS to DTW is $500+, and even though I am on OPM it doesn't mean they aren't watching...flights over $400, or $100 more than the "least cost logical airfare" per the corporate booking tool, need a justification.

The FF program seems very oriented to casual fliers. Mint may have started but no upgrades to speak of, B6 alliance is of little value.

I like how B6 is less nickel and diming - I really think it is a better experience in the air than UA and AA. When flying with family we will take B6 whenever we can.

Mike