West coast strategy for JetBlue
 

since B6 lost out the VX bid, it seems to many they have been effectively locked out of the West coast market. While I personally think a B6+VX merger would've been gang-buster airline that had a presence at west coast and continue to do well in transcon market, I don't think all is lost.

Currently, they have a focus city at LGB where they try to manage a local schedule but is also hemorrhaging a lot of money since they had to add more flights back in 2016 to squat on slots there. It really creates a situation where they loose a lot by operating out of LGB, but there doesn't seem to be any obvious alternative. SJC has been mentioned as a possible new focus city, but it's very competitive right now with WN and AS. ONT has been mentioned, but that's a very low yielding airport.

In a recent cranky flier interview with AA SVP of LAX, it has been mentioned that 2 additional gates at T5 will be added next summer with one as a CUTE gate. That brings to total 2 dedicated gates along with 5 CUTE gates that B6 has access to along with sometimes using NK gates for overflow.

I charted T5 activities a while ago and noticed that there are a lot of slack in T5 with JetBlue using the CUTE gates quite liberally and even NK gates occasionally. From that, hypothesizing B6 gates can do 9 turns a day and the non-HA CUTE gates can do max of 10 days a days and the HA gates can do 8 to 9 turns a day. There should be a maximum of 65 flights that can be operated out of those 7 gates. SY, HA, F9 and G4 operate about 17 flights a day and a lot of flight times are complementary to B6. So in theory, B6 could eventually build up a schedule of over 45 daily flights.

On top of that, there is enough gates space at BUR for a small regional operation, where JetSuiteX is building a local network on some of the most WN dominated routes. The area between BUR and LAX are richer than area between LGB and LAX. B6 could start by moving all JFK, BOS, SFO, AUS, RNO, SLC flights from LGB to BUR, since they are not dominated by WN and JetSuiteX don't fly to those airports. After this move, B6 would operate from BUR 3 daily to JFK, 6 daily to SFO, 4 daily to SLC, 2 daily to AUS, 1 daily to BOS, RNO. Add in 1 daily to ABQ and 2 daily to DEN. This operation of 20 daily flights along with JetSuiteX's schedule would operate a pretty decent network.

At LAX, they currently have scheduled 11 daily to JFK, 4 to BOS, 2 to FLL and MEX, 1 to MCO and BUF by next summer. This should be added with additional mint flying to EWR and IAD for mint schedule of
10 daily to JFK, 5 to BOS, 4 to FLL, 4 to EWR (since AS is downgrading product) and 2 to IAD for 25 total mint flights.
Add 1 daily to PIT and BWI, which have very little competition for a total of 4 daily non-mint transcon
Add additional international flights. Can start off with 1 daily to CUN. 3 daily international flights
Move other high O&D longer distance west coast flights to help provide some feeds on international flights including 5 to LAS, 2 to SEA and 2 to PDX. 9 total flights.
This would be 41 daily flights and they can add more if warranted. It's possible they will get more gate in LAX once they show greater commitment to operating more flights there.

And this would provide a pretty good coverage of major destinations out of LA (especially on transcon).

Some thoughts from a relatively new frequent B6 flier located up in the Bay Area. I'm normally a Southwest flier as most of my flights are intra-CA and western-US destinations, but this year I've had to do a lot more transcon travel than usual and with B6's status match earlier this year I've been making use of it. I've really enjoyed the service, but for intra-CA and west coast flights, WN's the only airline that lets me avoid SFO and LAX for all flights (and provides a broad set of choices in SoCal), and I'm likely beholden to them until another airline has such a wide network of CA coverage. Though OAK-LGB on B6 is useful. I also would have loved a B6+VX merger; as things stand now it seems like WN and AS are fighting for west coast dominance.

I think to have a useful West Coast network for customers, B6 would need to complete the triangle between the LA area, Bay Area, and Pacific Northwest (probably an SEA) - the latter 2 which don't have a direct flight. (Of course DL, AS, UA already do this, so there's decent competition here.)

At the same time, the nonstop transcons to JFK and BOS (and some other locations) could make them competitive at some WN strongholds, as WN transcons can be a pain - as long as there's enough O/D or connecting traffic to justify it (expanding at BUR and OAK come to mind).

I'd love B6 service at SNA or ONT though that seems unlikely. Pie in the sky would be being able to fly west coast-HNL on a B6 codeshare with HA, though I doubt that'll happen anytime soon (Of course my personal preferences aren't likely the most profitable decisions they could make!)

Getting into heavy competition on the West Coast is a great way to bleed cash short term with no clear long term winning strategy. Especially with the VX/AS tie up in place. Four airlines are fighting for that market and JetBlue - even if it upped to 40ish LAX flights - would still be way too small.

JetBlue seems to realize this, and that running LGB as a business commuter market is a bad plan, and is now considering a very, very different route network from its LGB hub. That was reported in an internal company briefing to the LGB station recently.

Think ski resorts and wine country. These are leisure destinations but generally higher yielding. The question is whether there are enough passengers to make it work.

(Link to my story about the plans.)

Interesting memos. It's clear what they have at LGB is not working. Those LGB-OAK/SJC/SMF are huge money losers. The problem is that they added those flights as part of slot squatting and there simply isn't enough domestic leisure destinations to cover all the flights they would need to add if they were to drop those intra-cali routes. Also I wonder if they will add flights to BUR in general if they are already thinking of adding daytime transcon there. I just don't see how they can maintain their current schedule at LGB.

That's why I suggest moving workable flights to LAX/BUR and just abandon ship at LGB. A 60 to 70 daily flight operation is nothing to sneer at. Even the combined operation of AS/VX only do about 90 daily flight at LAX. When more gates become available at LAX, they'd have greater chance of picking those up if they have a larger gate-constrained operation.

As for bay area, there appears to be no desire and no gate space for B6 to grow much greater than what they are right now. They even dropped SFO-LAS. And they don't seem to have desire to build up a new focus city, so focus of west coast remains LA basin.

i don't think there is much of a revenue bonus in getting your operations up to some critical mass. the number of travelers who choose an airline out of loyalty rather than schedule & price is diminishingly small.

jet blue shouldn't fly LGB-SMF at a loss just because they hope to earn loyalty from passengers who would otherwise chose another airline on more profitable transcons.

with no nonstop flights from nearby SNA on competitors, jet blue should be all over LGB-OGG/LIH/HNL.

Thanks for sharing your article. Quick question, can the Mint A321's land at BUR or is the runway too short for the longer plane?

I want to say no because I don't see anything larger than an A320 or a 737-800 scheduled into BUR on any carrier.

Landing is rarely the problem. Getting back out again, however.... :D

I believe the A321 would be challenged to get out of BUR with sufficient fuel to make it back to JFK.

FedEx and UPS fly A300s there - quite a bit larger than an A321. Question is whether an A321 can depart with a profitable payload to JFK.

saw this yesterday on crankyflier.
http://crankyflier.com/2017/11/16/lo...thwest-effect/
pretty much confirms what we've been seeing out of those newly added routes out of LGB. The yields are abysmal.

I'm pretty sure in the next year, B6 is going to move more operation to LAX and probably leave LGB and come to BUR.

Dropping LGB and the west coast routes would be a retreat, of course, but it could be a smart tactical one (I haven't looked at enough numbers to really judge) and consolidating at LAX would be fine for the transcon stuff.

But why more to BUR from LGB? What's the value proposition there? It is not like the locals are going to be way more welcoming of international service or that increasing frequencies in a heavily contested regional market will work better there, right?

Moving to LAX (including some non-transcon) is now finally possible given that they have some space to expand in T5. As for why BUR, it's a higher yielding region than LGB (closer to big money) and has some space for B6 flights. And remember, they get fined $6000 per flight when they are late at LGB, which will not happen at BUR. Without the need to squat on slots to keep WN out, they can operate a more compact schedule, which will lead to less lateness (which is the source of much contention bw B6 and LGB). They've shown they can break even at LGB operating around 25 flights a day without fines. It's when they increase to 35 flights a day and get fined, they suffer huge losses.

Building on the success at LAX, they can add local operations at BUR if certain corporate contract calls for them.

And the other consideration is that BUR also has growing hub operation of JetSuiteX. A larger B6 operation at BUR can help spread the word on JetSuiteX, which will be beneficial for both airlines.

B6, in my humble opinion, made a mistake with LGB. While some routes were great, there simply is not a big market along with local residents/government who don't want many flights out of there. They should move a lot of their operation to LAX/BUR if there is enough room and keep markets like BOS and JFK out of LGB.

Maybe the gate space is there. But I'm still not convinced the demand from O/D traffic is.What route(s) is B6 going to launch from LAX that would significantly outperform LGB and not face significant competition from likely 4 of the 6 other carriers (UA, AA, DL, WN, AS, NK) with significant LAX Ops?

Based on those Cranky flier link, LGB routes significantly underperforms all other LA area airports (including LAX where there are more competition). And B6 would not have to worry about breaking curfew.

I think they should definitely concentrate on adding transcon stuff out of LAX. At the end of the day, it's up to B6 what kind of West coast presence it wants to have. My point is that I don't think they are completely locked out of West Coast and have to stay at an airport where they loose massive amount of money.

B6 has definitely gotten some corporate contracts in LA area due to mint. Getting and sustaining corporate contracts and high value ff may require them to continue flying to SEA/PDX/SLC/SFO/LAS/AUS. Some of which can help feed transcon flying and flights to Mexico. And they can also add some of these leisure routes that they do great out of East Coast. I'm sure they know far better than I do on what makes sense to fly out of LAX vs secondary airport.