JetBlue Airlines Case Analysis

David Neelman realized his vision of creating an airlines company that is focused on customer service by starting JetBlue. During

JetBlue is an American airline company whose headquarter is located in the New York City. They are a low-cost airline who is rapidly growing in the Unites States. According to Wikipedia, “David Neeleman founded the company in February 1999, under the name "NewAir.” Many of their approach come from Southwest Airlines include low prices airfares. However, they differ in the amenities offered to the customers.

Southwest’s primary competitors are JetBlue and Spirit Airlines. These two airlines, like Southwest, focus on innovation and low airfare costs. Among the largest airlines are American, Delta, and United. However, these mainline carriers are far from posing any major threat to Southwest. (Coulter, pg 253)

1. There are a few trends in the US airline industry. One is consolidation, wherein existing players merge in an attempt to lower their costs and generate operating synergies. The most recent major merger was the United Continental merger, which is still an ongoing affair, but has created the largest airline in the United States by market share (Martin, 2012). Another trend is towards low-cost carriers. In the US, Southwest has been a long-running success and JetBlue a strong new competitor, but in other countries this business model has proven exceptionally successful. The third major trend is the upward trend in jet fuel prices, and the increasing importance that this puts on hedging fuel prices and capacity management (Hinton, 2011).

JetBlue has been one of the most successful airlines since it first entered the industry in December of 1999. Founder, David Neeleman, set out to succeed by offering low-cost air travel in hopes of perpetuating his services to as many people as he could across the US. He was very adamant about having a very customer oriented business that catered to the needs of all. In doing so he wanted to emphatically promote his obligation to safety, caring, integrity, passion, while allowing the customers to have fun while traveling. There motto helps portray Neeleman’s belief stating “You Above All”. His primary goals had been to follow Southwest’s objectives of offering low rates to customers, focusing on customer’s needs and comforts while distinguishing itself with their amenities. Neeleman’s other goal was to establish his low-cost leadership strategy by concentrating his airline in a large popular metropolitan area that already is already correlated with high airfare (Peterson, 2004). He then began operating based out of the New York metropolitan area at John F. Kennedy International airport with his secondary locations in Washington D.C., Boston and Los Angeles.

Jet-blue Airways is American low cost airline head quartered near New-York city. It’s foundedin August 1998 by David Neeleman with Joel Peterson as a chairman and David Barger as apresident and CEO. By late 2006,like some other airlines, JetBlue faced some softening demand and high cost due to the increase in fuel prices. Barger realizes that JetBlue needs to take further steps to slow its rate of growth. Barger was not sure about the reductions across E190 and A320. The E190 showedpromising growth opportunities and challenges for JetBlue. At the same time, the A320 wasconsidered as proven plane that had succeededover past 6 years. Most of the airline industries were using hub-and-spoke system and point-to-point services. Due to this service, South West Airlines showed consistent profits. After September 11th, the airline industry experienced trouble due to attack. Looking at the history of Jet-blue, it started with just 10airplanes in 2000 and by 2011 the company planned to have 290 planes in service. To support customers, Jet Blueprovided

There are two major strategic issues facing JetBlue. The first is that the company is growing very rapidly. This brings with it a number of critical challenges, such as recruitment and selection, maintaining the corporate culture, and maintaining high service levels. Secondary goals associated with this are maintaining safety standards, finding profitable routes to occupy and avoiding a unionization drive. Growing a company this rapidly is possible given the strong initial financing that the company has, but challenging in that the faster the airline grows, the more difficult it will be to find the right people and the right routes. The company can grow rapidly while plucking the low-hanging fruit but these tasks become more difficult over time.

JetBlue is a low cost US airline. The firm was founded by former Southwest Airlines employee, David Neeleman, and incorporated in 1998 in Delaware. The firm was not originally known as JetBlue, the initial name was NewAir. The plans for the new airline were announced by Neeleman in February 1999, and in April an order worth $4 billion was given to Airbus for up to 75 new A320 aircraft, at the same time leases were arranged for 8 aircraft. The firm gained exemptions for 75 take off and landing slots at JFK Airport in September, takes delivery of the first aircraft in December, and officially starts flights on 11 February 2000 (JetBlue, 2012). The first was being between JFK

JetBlue Airway Corporation is an American low-cost airline and it was one of a few U.S. airlines that were profitable during the sharp downturn in airline industry affected by the September 11, 2011 attacks. With its strong capital base, the company was successful due to its impressive management team, in which, David Neelaman has rich experience with airline start-ups; COO David Barger and CFO John Ower are all experienced former senior managers from other airlines. The company’s sales rose from $104,618 to $320,414 from December 2000 to December 2001 and net profit is negative $21,330 in December 2000 and reach positive $38,537 only one year later. As we can see, the company is a high growth company

JetBlue continues to generate positive free cash flow throughout the increasingly dragging economy. In 2005, they had taken a hit, with a loss of revenue for the first time since being incorporated in 1998…but they were able to quickly restructure and refocus. With that focus and determination, they have redeemed themselves and hurdled back into the top of the ranks with their competitors.

Research topic: Southwest Airlines Company is looking to establish a global presence in either Vietnam or Spain. This research paper is to help analyze both countries and to determine which of the two countries Southwest Airlines Company should enter. The second purpose of this research paper is to determine how Southwest Airlines Company should enter the country. This paper proposes to answer four questions: Who is Southwest Airlines Company? What does Southwest Airlines Company do? Which country should Southwest Airlines Company enter; Vietnam, or Spain? How should Southwest enter that country; by investing in a facility, marketing products, or joint venture? The participants are students of Mount Washington College, Global Issues: Business, Government, & Society course BADM364, team B. Team B members are: Kyle Forbes, Adam Paquette, Nina Scarpino, Louie E. Watson, and Cheryl Kessler. Research methods applied include research and discussion to compare and analyze findings to determine which country makes the best fit for Southwest Airlines Co. global business strategy. The data analysis will compare each country’s history, economy, politics, government, culture, demographics, infrastructure, how business is done, and how Southwest has done business in

Competition requires companies to make choices as to what to do and what not to do to attain growth and maintain survival. Airlines primarily compete on price and service; however, to a lesser extent they do compete on frequency of flights, frequent-flyer programs, reliability of flights, and other amenities. Southwest has a strategy — the creation of a tailored set of best-fit activities. Southwest began as a low-cost, no frills airline 30 years ago. (Thompson, Peteraf, Gamble, & Strickland, 2010) It has grown to be a national airline, but still has its basic cost structure. Southwest has never served meals or reserved seats in advance. It still has what is basically a linear route structure. It only flies one type of airplane and it wants to stay in high-density markets. Its operation is highly efficient. The end result of this strategy is a sustainable, competitive advantage and superior profitability. Southwest was the first airline to introduce ticketless travel. Customers

JetBlue airline was founded by David Neeleman who is a Brazilian born entrepreneur. His goal was to single handedly create a unique airline that was innovative for the current market. The low fare airline was designed for customers who needed to travel at affordable prices, and which would essentially create a new strand of business. Named JetBlue, Neeleman’s airline originally traveled to various cities around the United States, but has recently entered the international market by offering flights that reach countries such as Puerto Rico and the Dominican Republic. Since it is a customer oriented company, JetBlue makes ordinary flights into an extraordinary experience for its customers. With

Southwest Airlines /Competition Paper Introduction: Air transport is a global industry and as such every airline is a likely challenger for every other. It is contrary to expectation that any airline will be able to contest on a large scale without being associated to other carriers. Traffic feed is the industry's lifeblood and stand-alone carriers will be labored to carry low-revenue point-to-point traffic when front with airlines able to offer manifold route alliances. Southwest Airlines is a major carrier to the USA accounting for about 85% of its airfreight tonnage, but it also operates scheduled services to South Africa, Japan and Hong Kong. The subject of strategic alliances inside the air transport industry is not a well-researched

JetBlue’s board promoted Barger to the CEO role in the wake of a highly publicized operational crisis