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Jetblue Airways: Managing Growth Essay

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Jet Blue Airways; Managing Growth

1. Jet Blue´s Business- level strategy; value and cost drivers Jet Blue uses to create and maintain ist competitive position
Founded by the discount airline veteran David Neeleman in 2000, JetBlue Airways has quickly become one of the largest discount airlines in the United States. Starting primarily by serving the East Coast, the airline has since expanded throughout the country and entered the international market. The reasons for its early success are numerous: JetBlue entered the market with one of the largest levels of liquidity of any start-up airline; it met the needs of customers’ whose primary concerns are price and route; and it successfully defined its brand and differentiated itself
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Therefore, Southwest as well as Jet Blue are considered as low cost carriers (LCC). Jet Blue offers fares up to 65 per cent lower than legacy competitors. Jet Blue Airways positions itself by connecting large, typically northeastern, US cities with warmer cities in the southeast. Jet Blue´s emphasis is like Southwest´s on low fares and point to point transportation. Jet Blue entered the market like Southwest with only one machine, the A320. In this way they could ensure serving a variety of medium- and long-haul routes and numerous overnight flights. Jet Blue could also standardize its training and servicing processes around the aircraft. This allowed them to gain flexibility in scheduling and capacity management. Another feature for customers to make travelling with this airline more attractive are added comfort features such as assigned seating, leather upholstery and satellite TV on individual screens in every seat. Their key principle was that flight cancellation should be avoided at all costs. In 2005, Jet Blue broadened their portfolio in entering the market of medium-sized cities, which was served only by regional airlines. They entered this market using a new midsized aircraft called E190. In launching this new machine, they were able to use synergy of combining the A320 and the E190 profitably while serving now smaller and bigger airports. This portfolio mix gives Jet Blue a yet matchless, strategic competitive advantage compared to the other airlines.
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