BearX220

https://www.cnn.com/2022/07/28/inves...lue/index.html

I don't see this going smoothly, or quickly, or being any good for consumers or anyone except Spirit shareholders, but I think it's going.

ewoo

I hope DOJ blocks it.

The end result of this will be higher fares for consumers. There's no way around that.

gkbiiii

JetBlue will become a major US carrier; which will service wise, rival Pan Am of the past! Who cares about losing "the Ryan Air of the Americas!" If you can't afford to fly, "thanks for calling Greyhound."

BearX220

There is absolutely no factual, empirical basis for this belief. There is a giant chasm between JetBlue's aspirations and tactical ability to execute day to day, and I think that gap will only widen as the operation tries to scale.

jebr

JetBlue regularly has had operational meltdowns and, at least when I was caught a bit in one, didn't find the service to be anything to write home about (a just-under-3-hour rolling delay didn't even warrant a drink and snack cart.) Greyhound has also severely restricted their network, and is often more expensive now than even basic fares on legacy airlines thanks to the competition (much of which was driven by Spirit.)

There's no question in my mind that JetBlue taking over Spirit and eliminating it as an ULCC will drive up fares on the markets Spirit flies in. I'm not convinced that the benefit of a fifth large non-ULCC carrier is worth removing the largest ULCC from the market and hoping that segment grows more organically than JetBlue can. If JetBlue really thinks that it needs an acquisition to grow, then they should be pursuing Alaska (which, IMO, has a much more complimentary route network and service offering) than trying to eliminate a significant chunk of the ultra-low cost market, especially since there isn't even suitable ground replacement options in most of the country thanks to that competition JetBlue is trying to reduce/eliminate.

BearX220

They're a daily feature of B6 life. In 2022 they have the worst on-time / reliability stats in the US. This is current from FlightStats:



I spoke with a friend in the industry this morning who compared JetBlue to a college newspaper. They may imagine they're The New York Times, but the actual product is full of typos and amateurish reporting. This individual's three big questions about the merger were:

• Where are they going to expand to? They aren't getting more slots at JFK.
• Given that, what's the bigger airline's path to profit? B6 makes money to the Caribbean / CentAm and on those Mint-heavy transcons. The rest of the operation is a wash; Florida is all low-yield markets. B6 will need more hubs but there's no easy pickings outside of maybe STL. Deploying 200 more A320s to stations like Albuquerque or Boise may be great for the route map, but not for shareholders. It's no wonder B6 stock is down today while Frontier's is up about 20% as I type.
• What happens to the AA coordination? Everyone seems to think it's done for. B6 labor doesn't like it anyway; they think it makes B6 an AA regional carrier, sort of a big Envoy.

This all day. JetBlue can quack all day about the supposed "JetBlue effect" on fares in markets it enters, but the "Spirit effect" was a lot bigger. As someone said in the press this morning, even if you never fly Spirit or Frontier, when you fly UA or DL on a route they serve, you benefit from their existence. Nobody says that about JetBlue. The merged company will likely occupy a fare band one notch lower than the US3 but well higher than Spirit did.

You better believe AA/UA/DL are breathing sighs of relief that F9+NK fell through. THAT deal might have created a formidable US-nationwide version of EasyJet or Ryanair, exerting the same pressure on them that those carriers exert on BA/LH/AF. This deal, on the other hand, is not, repeat not, disruptive -- at least the way JetBlue is selling it hard today. It's a lot less threatening to the network incumbents than Spirit-Frontier would have been, and better for shareholders, more expensive for customers.

sfozrhfco

Not having the vast majority of their planes traveling through NYC/BOS on any given day will dramatically help their on time performance. Flying within the West and on Mint flights on B6 have been far more reliable over the last couple of years. LON flights also have very high on-time and completion rates. As the network diversifies, this will help operations immensely. They can also now become larger at LAX/SFO and gain more of the premium traffic in those markets. They will also have the size to move into widebody flying as their transoceanic network expands. There are lots of benefits to this merger for customers, employees, and shareholders. Will it be a bumpy next couple of years? Sure--but B6 is actually quite good at big transformations. They did a great job with the Mint launch. London has been a success.

Boeing is still not able to deliver planes on time which restricts capacity at carriers such as WN and AS. The big 3 are also not going to grow as fast as they wanted to through 2023. B6 got very lucky with the timing of the offer as well as the market tanked just in time for the ULCC offer to drop far below the offer made by B6. This is the exact opposite of the situation with AS/VX where AS paid peak prices only to stagnate for years with no clear plan to grow even now.

There are lots of good opportunities ahead for the combined carrier once the integration process is over--with an extremely fuel efficient fleet and a much more diversified network.

Long Train Runnin

I guess it's too early to know but this is Flyertalk after all!

I wonder what the points will combine and transfer at once TrueBlue becomes the only program.

gkbiiii

In the future, a Hawaiian merger, would give them an impressive South Pacific and Asian network.

RustyC

I'm just happy that Spirit can't ruin Frontier now. Frontier has the far better FF program to make things more tolerable for elites. The planes also don't seem quite as dirty, and the FAs don't seem as battle-hardened. Inheriting the Spirit workforce could be a shock for JetBlue, especially if they're trying to serve a different segment of the market.

jiburi

Are you kidding?! Maybe not 100% good for consumer but I believe this deal is best for shareholders, especially employees and most consumers. As for passengers, no more sardin-ing passengers into unrealistic small space, award redemption will actually be rewarding and easier to redeem . Some inflight service will return and pilots and employees now have a better future and promotions to look forward to. Even iN an event of iron, you won’t be left in the cold. Sure, some consumers will lose low fares, but they were unrealistic in a world of airlines where fuel price and pandemic has wrecked continued havoc.

This is the right deal that benefits most people.

Jiburi

BearX220

JetBlue's service differentiators have been eroding for years, inevitable casualties of scale and Wall Street pressure to align with lowest-common-denominator industry norms. Look what happened to free checked bags. I expect continued rapid growth will keep that trend going. Let's check back in a decade; I will bet you lunch that today's coach pitch becomes tomorrow's E+, and most Y inventory will be pitched like everybody else's.

Simple really: a big network airline cannot fly fewer seats around, charge less for them, and make enough money to placate Wall Street.

TWA Comfort Class and AA MRTC both failed at scale. JetBlue's current coach standard is probably next.

That is the case everywhere in the industry today. They can't stuff the pipeline fast enough.

rsteinmetz70112

Anyone considered that JetBlue might go ULCC or that they might not get Regulatory Approval?

RustyC

I have no doubt they want to go in that direction, but I think they're close to hitting a wall. They've been totally ignoring trends in shapes/sizes of people for years now, but I think they can only take that so far. I'm 6'0", which I think is taller than average but nobody mistakes me for an NBA player. Would guesstimate it's around the top 20-25th percentile or so. Their old planes were really terrible for being knee-crushers, and I was amazed that they had that same aicraft for the FLL-LIM route (the DVT Express). I did buy an exit row seat the second time I flew that (as others looked on enviously). The newer planes with the curved backs of the seats were a little more humane.

The point being that if they try to make the seat pitch even worse, they'll go even further into percentiles of people to whom they give the choice of suffering through that or buying E+. It's one thing to do that to the NBA players and others in the top 10 percentile, quite another when you get to the 40th percentile or so and still are trying to do it. You're basically playing divide-and-conquer (the same thing they do to people of size) and it's harder to do that when the masses of people are affected. You'll get DOT complaints, some actual DVT cases and grandpa saying that flying transcon messed up his knee or whatever (maybe E+ was full). In any case, it'll get into the media and you get media-shamed. Maybe even onto the late-nights where you're the airline of choice for Jimmy Fallon jokes about bad airline experiences. Not the best place to be.

Loose Cannon

Does the government have the authority to block mergers? If so they should.