Will CO match B6?
 

YES they just did this morning.
all 3 NYC airports to IAH $214 all in

Honestly, I don't really understand the move. Continental has a loyal following, which will not drop off because the flight is from EWR and IAH, which are both mega-hubs for Continental. Jetblue is only flying three flights a day, which is 500 seats each day, each direction. They are not hourly flights like Continental has. Jetblue doesn't need to find a large market to fill up their flights, so this flight will probably be a success, with yields that are necessary for profits. Continental dropping fares is only hurting themselves. If they are dropping fares on one of their most travelled routes in the system, then it will hurt in the long run.

I was surprised too....While Continental may be hurting themselves they may be hurting B6 even more by not allowing them to gain much ground or any ground by the decision to move into Houston. Could they be trying to eliminate any competition.

JetBlue competes on price--sure it tries to differentiate itself, but its primary message is price. CO has done the right thing by attacking this competitive strategy. Just because CO has published a matching fare doesn't mean that it will be available! However, JetBlue can't claim to be the cheapest HOU/NYC carrier!

You don't need to be the cheapest, you just have to be the best all around...great product with great service at a great price. Jetblue always has seem to strive for that.

River runs deeper...
 

While I agree with everyone here... that CO and B6 really aren't competitors on this route because they offer really two different services (basically HOU-NYC O/D traffic, since B6 doesn't really connect to any place via JFK that would make JFK a convenient stop for HOU O/D pax).

BUT, this river runs deeper... CO and B6 are fighting tooth-and-nail at EWR for the NYC O/D market... and there's some contentious blood between them... CO's attempt to "take-on" B6's entry to the HOU market is probably fueled by the larger rivalry between the two companies...

Agreed, they are battling it out in EWR: CO is the bigger fish in that pond! Mr. Kellner has alluded to this struggle in his public pronouncements. So, I bet anytime Continental sees B6, there's probably an automatic response to attack!

I have to disagree with this. Jetblue has some destinations where a Houston passenger would have to connect through EWR from IAH on Continental where on Jetblue they would have to connect through JFK. It may not be a lot of people, but there are some people out there who could utilize this service for connections.

Send B6 is CLEAR sign...Don't mess with Texas!

I know it's competition, but I personally have a different view on this practice, so here goes:

When an airline like jetBlue or Southwest enter a new market, competing legacy airlines on that route usually match their fares to compete. The way I see this is that the legacy airline has gotten away with "screwing" (in lack of a better term) the customer on over-priced service. If I were a loyal CO customer paying $400 for most of my flights from NYC-IAH the past few years, and then all of a sudden the fare drops to $200...I would not think twice about shifting my loyalty over to the airline responsible for bringing down the fares in the market. After all, it's the jetBlue Effect that impacted lower airfares.

A perfect example of this technique, JFK-BDA. Pre-jetBlue fares on this route were sky-high STARTING around $250 each way. JetBlue entered the market with $129 fares, signifigantly lower then what AA charged...and sadly got away with all those years. So, AA reduces the price to $129 and makes a statement that they did this to show appreciation for their customers for flying AA to the island for 30 years......BS! The real reason was beause jetBlue entered the market and gained market share. Customers are not dumb....they know they are getting a better value on jetBlue. And B6 is to thank for lower fares on those routes!

Way off topic, but in reference to the BDA flights, are they doing well? I am looking at next day fares, and they are pretty high. I would expect that this correlates to strong yields for a short flight.

B6 inflight cremwmembers have been telling me that BDA is turning out very nicely. There was an aritcle the other day about BDA air traffic/tourism being up 6% since jetBlue's entry into the market! Yes, indeed the yields are very nice due to the short distance and much higher fares...keep in mind that BDA is an upscale market and $129 start fares make money on every seat...I think it's only about 700 miles BDA-JFK??

http://www.post-gazette.com/pg/06179/701308-37.stm

More flights spur Bermuda tourism
Wednesday, June 28, 2006

The Associated Press

HAMILTON, Bermuda -- New flights and a new airline have produced an increase in the number of arrivals to Bermuda International Airport, officials said.

Overall arrivals were up 6 percent, or about 4,000 people, and arrivals from New York rose 26 percent in May alone, according to Airport General Manager James Howes.

The increases coincide with the introduction of New York flights by low-cost carrier JetBlue Airways and new flights to London by British Airways.

JetBlue's entry into the market prompted other airlines, including American Airlines and Continental Airlines, to cut their prices and caused an overall spike in traffic to the British territory, Howe said.

"We saw no drop in traffic with American and an increase on Continental as well," he said. "The introduction of JetBlue has not resulted in any loss of business, it's brought it in."

Last year, the number of air arrivals to the island dropped, which the Department of Tourism blamed on high fares and fears about storms among tourists. Overall visitors rose 7.9 percent because of an increase in the number of people arriving on cruise ships, the government said.

Reminds me of the time when B6 started making LGB into a hub airport. Suddenly, lots of other airlines started becoming interested in getting gates at LGB (which were become scarce with B6 taking a bunch of them), even though they had little interest in LGB before B6 started making it into a hub airport. And B6's emphasis on transcontinental non-stops seems to have gotten other airlines more interested in offering more transcontinental non-stops at lower prices than they used to offer.

Such as? Upstate NY? Vermont? Hardly the reason any airline would start HOU-JFK service. Sorry, but I don't see B6 stealing enough traffic from CO take make them truly competitors.

You misread my statement. Jetblue never starts a route based on connection possibilities. There has to be a large enough amount of O/D passengers in a market for the flight to be a success, which is what Houston is. However, I was trying to demonstrate the close proximity of Newark and JFK. This would allow Jetblue to compete on certain connection routes with competitive fares. Cities such as SYR, ROC, BUF, BTV, and PWM could attract passengers to fly Jetblue. You could even throw in BOS. Even though there are no direct flights by B6, they may be cheaper then a direct flight on CO where they have to fly out the next day (i.e. tomorrow's flights from IAH to BOS are nearly $1000.)

Who said that Jetblue would have to steal Continental's market to be a success? Some people said that JFK-BOS wouldn't attract the "Manhattan businessmen," but this is one of their most profitable routes. They were able to get the people from Long Island as well as from the city. The same could be said for Houston. Hobby, on the south side, may attract a different crowd then IAH, on the north side. I haven't personally been to Houston, but it sounds like it can take up to 2 hours to navigate the traffic to IAH from the south side of town. Jetblue is only looking to attract less then 500 people a day in each direction on a route that is monopolized by Continental. This route is an easy and smart choice for Jetblue.