JetBlue wants to acquire another airline. Spirit Airlines was a bad choice. But is there a better option for JetBlue: Alaska Airlines.
Would An Alaska Airlines – JetBlue Merger Make Sense?
JetBlue appears hellbent on finding a partner, seeing acquisition as pivotal to grow and compete in the U.S. market. Shotgun marriages often do not work out well and Spirit Airlines recently turned down a far-more lucrative offer from JetBlue than it had been offered from Frontier Airlines, noting the lack of synergies between the two carriers.
JetBlue was not interested in expanding Spirit’s ultra-low-cost service model but essentially using Spirit Airlines for its aircraft and labor needs as it battles stalled growth plans and a regrettable operational performance.
But that was a plan doomed to fail, particularly under the current Administration which appears less tolerant of mergers and acquisitions that may have negative impact upon competition.
Alaska Airlines is a much better partner for JetBlue.
#1 – Complementary Route Networks
First, Alaska Airlines’s focus on the West (particularly the Pacific Northwest) is a weakness of JetBlue. JetBlue’s focus in New England and the East is a weakness of Alaska. The limited overlap in route network would allow for the merged carriers to escape some regulatory scrutiny.
#2 – Compatible Employee Culture
Second, the employee culture is more computable than that of Spirit Airlines. Alaska Airlines has premium cabins and flight attendants are known for being amongst the nicest in the industry, something JetBlue shares. While the two carriers share distinct differences, the two appear far more compatible than Alaska and Virgin America were in 2016.
#3 – Fleet Type Differences Manageable
Third, the difference in fleet types should not be seen a dealbreaker. Certainly, one great appeal of Spirit Airlines was that it would keep aircraft fleet simple: all Airbus A320 family. Meanwhile, Alaska Airlines is moving back to its “Proudly All Boeing Fleet” after acquiring a subfleet of A320 family aircraft from Virgin America. A fleet composed of Boeing 737 family and Airbus A320 family aircraft is not as ideal as a single type, but still allows for an efficient operation versus multiple plane types.
#4 – Effective Competition For Network Carriers
Finally, a merger would combine the 5th and 6th largest carriers in the USA to potentially create a stronger competitor to American, Delta, and United. A combined Alaska-JetBlue could not only offer a combined nationwide network, but better hold accountable legacy airlines in terms of pricing, as both Alaska and JetBlue do today.
CONCLUSION
To be clear, I’m not in favor of any merger…I think consumers generally lose when it comes to any airline merger. But the JetBlue – Spirit Airlines merger made no sense and as JetBlue genuinely struggles to finds its place in the U.S. market, a tie-up with Alaska Airlines seems like a much more logical choice.
Matt, I am a long time AS Flyer (1mm +) and agree that Alaska I do not believe will survive as a “stand alone” carrier while I do not speak for anyone but myself the new management of AS like none of the past managers. I firmly believe that unlike past management who flaunted over their FF’s the current management seem to have moved us a notch or two down the ladder. I say this from hand interaction with the team at certain events. They’re jumping in bed with AA so fast I think will become a fatal mistake in the long run unless of course there is a merger partner even though Parker has left the building.
I am neither for or against Jet Blue other than it makes sense as well as possibly durable with DOJ
Travel Safe
JetBlue – Alaska is by far the most sensible merger. Keep those Airbiii!! I truly believe this should happen , keeping the JetBlue name and product.
No merger. Only codeshare.
I have said before that Alaska’s biggest mistake when getting Virgin was not paying Branson an annual fee for the Virgin name as was supposed to be. Keeping the Alaska name was crazy. While it may be fine in the NW and West coast where people are more familiar with the branding and Bob Marley on the tail, those in the NE and South, especially leisure travelers, are completely perplexed by the name and who they are and the size of their network. The Alaska name used to be quirky and had a niche with a pocket of flyers. As well some strong loyalty. That is changing. They are going nowhere beyond their current routes without a complete rebrand. Yes, JetBlue offers that and a chance to expand overseas in ways it never could with the current Alaska name. It is the merger that should happen. If not, Alaska needs to rethink greatly its future strategy or they are going to meet headwinds at every turn.
JetBlue needs to get its own house in order before it even DARES to think about ruining Alaska.
Amen to that!
Alaska better get their prices down from the west coast direct to Mexico otherwise I ain’t flying them again. United here I come.
I always thought a merger between Hawaiian and JetBlue would be interesting. They have some over lap on the mainland, and I don’t think operationally they are that different. Obviously they aren’t the same, but there are some synergies. Hawaiian gets a stronger presence on the mainland and a link to the UK, and JetBlue would have a direct link to Asia as well as New Zealand and Australia. I doubt it would happen, but it could work out for them under the right leadership. But I think there are just too many fundamental differences between them for it to work.
Alaska has nearly twice the market cap of Jet Blue. Not sure how Jet Blue would “acquire” Alaska. It would go the other way around if it did, though Alaska would probably keep the Jet Blue branding, which has more national name recognition. Certainly the Alaska management has been more consistently successful in running a profitable airline than Jet Blue’s management.
Given JetBlue’s ugly balance sheet, it’s pretty likely that Alaska would insist on the top spot in any merger between the two. Probably why they don’t want to consider it.
Concerning the name, should Alaska ever merge with someone, it reminds me of Southwest’s expansion north and east 30 years ago when people were saying they should change their name too.
A name associated with a region is at least doable/vague in comparison to an airline named after a state that is not even in the Continental U.S. and with one of the lowest populations. The decisions to keep the name Alaska are perplexing and foolish if they ever want to get bigger. Again, they made a massive mistake not converting to the Virgin America name. By the time Southwest grew to be national that brand was so entrenched in the public mind because they had one person who knew how to do it, Herb Kelleher. None of the airlines today have the personality to make a poor name stick. There will never be another Herb.
You are confusing “continental” with “coterminous/contiguous.” Since Alaskan statehood, the USGS has included the state as part of the Continental United States. https://www.usgs.gov/faqs/what-constitutes-united-states-what-are-official-definitions
Thanks, “Norm,” lol
Are you allergic to respectful decency? My post stated a 100% verified fact. I know that other people in this forum, being educated and successful, appreciate accurate and truthful information. It’s sad that you reject knowledge and are proud of ignorance.
Or maybe I take things a bit lighter, Francis. And save the nuanced details for the important stuff.
I don’t see anybody complaining about Delta keeping their name when they expanded outside the Mississippi Delta or moved hq out of Louisiana
Delta also means change.
agree @vibepilot… I think people are underestimating the devotion people have to the brand out here and overestimating the confusion it’d cause with folks outside of the NW. Bump up the marketing budget by a bit and you should be find.
And outside of mint, which they could easily hold onto, I don’t see a whole lot of value in keeping jetblue’s branding.
Never going to happen. AS will never go back to mixed fleet, simple as that
The way Alaska is screwing up their business with pilots’ dispute, a takeover by Jet Blue would quickly put them out of their misery….
This merger might make sense for people on the coasts, but to me it seems like the resulting carrier would be little more than a glorified code sharing agreement. Consumers in the Central and Mountain time zones would really not benefit at all from this.
From Austin I can go efficiently to either coast, but I can’t get to Chicago, or Denver. I love flying AS, and their partnership with AA is great, but I fly them exclusively on nonstop flights, and and I usually pay outright for F because their fares are reasonable. I can’t see how any flier between the coasts would see any benefit, but they’d certainly lose a competitor on some nonstop routes to the West Coast.
Although I don’t think a JetBlue – Alaska merger is realistic, their position wouldn’t be similar to US Airways 2005-2013 network. Barbell shaped network with mid-continent destinations only as spokes to their coastal hubs.
True. No realistic AUS-ORD option with LUS, but the AA merger fixed that. With B6/AS us Middle America hillbillies are left out in the cold.
Yes, they’d likely need some sort of hub in the middle of the country.
Buying Sun Country could give them a hub at MSP, though with lots of competition with Delta. (Sun Country is also a quirky semi-low-cost operator but with good service and a 737 fleet, so it feels like a reasonable fit)
Alternatively, a combined Alaska-JetBlue airline could set up a hub at a captive hubless place like STL or even a growing high-wealth transplant market like ATX.
I would think with Delta having the 4 corners of the U.S (Atlanta, N.Y., Seattle and LA.), they would want up and down both coasts and try to buy Alaska and Jetblue but that probably couldn’t happen.
While a B6/AS merger makes sense, there are too many entitled board members at AS to approve a B6 acquisition. AS would likely want to be the acquiring carrier, but B6 isn’t all that attractive right now financially, so I don’t think a merger has much of a chance of happening unless AS gets into trouble and needs bailing out by B6.
This would be a terrible idea. Alaska brings nothing of use to Jetblue and the cultures are actually very different. The fleets and product are not compatible. Jetblue has no interest or need for the 737 max. Alaska is spending a boatload of money to get rid of their Airbus planes. Alaska’s lack of scope clause is also problematic. This merger would be the quickest way to put both airlines out of business.
Alaska should buy Sun Country and WestJet (Western US, Western Canada, Alaska, Hawaii) (Boeing fleet)
Jet Blue should buy Hawaiian. (Airbus)
Spirit and Frontier should combine. (Airbus)
JetBlue should figure out how to operationally run an airline before considering an acquisition. They cannot even create synergies within their own organization, why would they think they could do so in merging with another.
Both carriers are hermoraging pilots to Delta and United. Both are in trouble without a major change. The math is fact. No pilots, no flights. The smaller carriers must merge or disappear.
Alaska would be a good acquisition airline by Singapore or EVA except federal rules prohibit foreign airlines from buying a majority stake. Alaska is the best airline in the US for the economy class soft product.
It would make way more sense for jetBlue and Allegiant Air to merge. They can keep both structures and upgrade the service Allegiant provides. They could fly both hub-and-spoke in larger base cities and point-to-point in smaller satellite bases. They could easily replace the aging fleet with NEO 320 and 321. The Las Vegas hub would give jetBlue a huge chunk of the leisure market in the West. Unfortunately, it would probably mean the cancelation of the 737 Max orders unless jetBlue accepts them. Alaska wouldn’t really give jetBlue much except the West Coast. If they’re going to spend the money, why not go for an airline that’s really spread out all over the country?
I think it would work perfectly. They could raise the fares because people will pay for the convenience of flying non-stop from their hometown airport and provide less fees and more complimentary inflight service. It would really change the aviation landscape for sure.
Umm, not to be rude or sound it, but, what? Allegiant is an ULCC that focuses on third tier markets from popular holiday destinations. Think Vegas to, I dunno, Hays Kansas, lol. It’s completely no frills and about as low brow as an airline can be. It’s the closest thing we have to a regional bus line in rural areas. And you think that somehow works to merge that with an airline that tries to be more of a lifestyle brand with Mint offerings, trendier cabins, and, now, overseas flights? As well an airline that is primarily focused on high density urban city pairs? This is like merging Dollar Store with Marni, lol.
IDK, JetBlue passengers have started to look and sound a lot like Allegiant passengers lately.
I’m of the opinion that the best merger for Alaska would be Hawaiian. JetBlue will be fine if it merges or stays separate, as will Spirit, Frontier, or Allegiant.
They can rebrand as Inset Airlines since that’s the section of the national map they’ll own.
JetBlue would need $10+ billion to even think about by Alaska which is way more than Goldman is willing to finance for their proposed NK takeover. I can’t think of an instance where a carrier significantly smaller by market cap took over a larger one that wasn’t in or facing bankruptcy.
With ALK having a market value that nearly twice JBLU’s there is zero chance JBLU could buy, merge or take over ALK. And I don’t think ALK has any interest in JBLU.
It will end up being worse for customers. Less choice.
JetBlues culture is by far the worst compared to Alaska. I’ve worked for both and interviewed to go back to Alaska. Even the interview process at Alaska made you feel comfortable and the FAs that we’re doing the presentation at the interview we’re very interactive.
JetBlues culture is allowing a hostile, harassment, bullying, name calling, and stalking environment among the work groups, at least for the FAs.
Alaska def doesn’t want Airbus because they are retiring the ones they got from Virgin and JetBlue doesn’t want Boeing because they are committed to Airbus.
JetBlue is butt hurt because nobody wants them and they never wanted to grow. They never wanted to grow in Dallas or Atlanta because they were to scared to go against the big 4 or the main carriers in those markets. They would have NEVER thought about Spirit until Frontier announced they wanted to merge with Spirit
Since I happen to work at JetBlue and have for well over a decade I can say unequivocally that your a liar and your post is a lie. With the possible exception of how you describe Alaska there isn’t a single thing you’ve said that is remotely accurate.
USAir-PSA-PIEDMONT MERGER
Sorry but it’s the truth and many don’t like the truth being told.
I was inflight at B6 and witnessed extremely unprofessional behavior among that work group and management wouldn’t do anything. It’s why so many needed TWU voted in to continue allowing that kind of environment.
Having several friends at other airlines, they are shocked that behavior is allowed at JetBlue. Also having worked at Alaska, I know that behavior would never be allowed there.
As far as JetBlue not wanting to grow, that’s the truth. They are too focused on the NE and way too afraid to grow in markets because of the top 4 or where those airlines are headquartered
Oh, so you’re anti-union…that explains it.
Not once did I say if I was or wasn’t for a union
What I saw was extreme unprofessionalism and why those people needed TWU in so badly in order to continue to be hateful and unprofessionalism.
Unless you think stalking your coworkers online, harassing them, slandering their names, bullying them, etc is mature, professional, and not at all a hostile environment.
It’s why the morale among the Flight Attendant work group is extremely low.
Never seen that kind of unprofessional culture and none of my friends at other airlines has seen it to, just at JetBlue.
Their FAs were even hateful and unprofessional towards Spirit FAs on social media after JetBlue unsolicited a offer to buy Spirit. That’s just the culture there.
Virgin America had the best, most comfortable domestic first/business seats and friendly cabin crews. I still shudder at what was lost when Alaska bought them. Out went the wide white leather seats and in the PC ‘equity’ proletariat product of reduced width and pitch and padding. A woke airline, Alaska claims it’s ‘only fair’. Anything that is of quality, high standards has a short shelf life.
I’ve been around long enough, since I first started flying in the early 1960s to see the changes for the worst. In domestic first American cabin crew cooked fresh eggs for breakfast, up until around 2004! In the galley, in an electric skillet! Now? Gooey scrambled eggs dumped lukewarm onto a plate from a carton. Even French, German and Spanish military MREs have better tasting eggs.
It’s been a rush by the industry/Wall Street to devolve into one monstrous behemoth Interflug/Aeroflot of the 1960s, or turn America’s carriers into Ryan Air, Wizz Air, Spirit, Easy Jet. Essentially a human cargo ship in the sky that will make Bolt Bus seem luxurious. I’ll wait for the day the cabin crew throw peanuts onto the floor as the minions scramble for them from their stand-up seats.
Better fly Jet Blue’s premium class while its still around.
Maybe turn off fox news for an hour or two a day?
Oh, so you’re anti-union…that explains it.
Can you write about good merger/acquisition choices for Southwest please?? : )
There are none. WN is in the position that their best and only option is continued organic growth. It’s served them well over the years. While they did purchase Morris years ago they were tiny in that regard and it was a quick and painless entry into a region they were lacking then.
WN is just too unique, and trying to integrate a ULCC into their operation would be a disaster. The boarding processes, free checked bags, no redeyes, and the wonderful culture in-itself would prove to be a disaster in integration. WN is uniquely positioned between mainline and ULCC. They are better to just keep expanding on their own, slowly as they have been for years. They have endless markets still to be entered, with overseas flights being something discussed for years. Look at how they did it in Hawaii. That’s the WN model for expansion.
They acquired AirTran, and it wasn’t dissimilar from AS, just based in the East. Presumably that was just to get access to ATL which has probably been a catalyst in their organic growth model that you speak of.
Yes, but that merger was probably the extent of size they could absorb. Even that was met with some issues. I see them perhaps looking at small niche carriers that have a foothold in a market (like Morris and Air Tran did…which was a nifty way to grab Mexico etc flights)) but that’s the limit. Anything bigger becomes a mess and what’s out there now (other than Breeze or Avelo) are too big to try and maintain a WN culture. Spirit? Too big and the model is completely different from WN. Frontier? Wrong aircraft like Spirit and offers them little that they couldn’t just do themselves. And they are already growing in DEN. JetBlue? Not at all the culture or brand.
It strikes me as hugely hypocritical how many get all “up in arms” when two airlines wants to merge but tolerate multiple mergers in multiple other industries like they never happened at all. The same principles of our apparently beloved capitalist culture exist in the commercial aviation industry too. Please, spare me the angst!
AA- Jetblue-Alaska merger after bankruptcy Reorganization similar to USAir-PSA-PSA in the 90’s.
Lower AA $46 Billion debt and route system to DFW & CLT hubs plus International flights.
Jetblue to handle East Coast and nonstops over AA hubs.
Alaska take over of management and West Operations.
But what about the US Government’s 51 Million Shares Options in AA?
USAir-PSA-PIEDMONT MERGER
Jet Blue has ALL Airbus Planes, which I personally prefer over Boeing for passenger comfort. So there would probably be EXTRA COST and Time in training for the pilots for both Boeing and Airbus cockpits. Probably No Go Deal.
Southwest could acquire Sun Country.
AS should wait until B6 eventually hits Chapter 11 and pick off the valuable pieces without the debt. Also, the name concerns about “Alaska” are overblown. It’s a memorable _brand_. Remember when you first heard of “Amazon” as a bookstore?
Sun Country is the one many have speculated that WN would buy over the past few years. I could see this. It gives them a strong footing in MSP and from there. And it’s small enough to quietly integrate without much drama.
As to your “Alaska” being like “Amazon”….well, that takes leadership and unique branding to take geography to a a fresh image. Even though I think Amazon has a much broader scope as a brand name. It’s vague enough to not be too associative yet vast enough to be thought of as everything. In many ways it is brilliant. Could Alaska do the same? Sure. But they lack the growth, leadership and vision to create an image of Alaska being like Amazon. And it has far too many connotations within American culture as being a wintry state with all the stereotypes that may or may not be true.
Could Alaska make a go of it with that name? Sure. But they need a Herb Kelleher kind of guy who can create a cult of personality that supersedes it all and drives it deep into the consciousness of the public. Who at Alaska can do that? And, sadly, they had the perfect opportunity with Virgin, they were just too stubborn and old school (and cheap) to pay for a name that was perfect, established, and for which the work was done. At this point they might be better off changing their name to Montana and replacing Bob Marley with an abstract image of a lumberjack pointing to the sky.
As a 3rd generation Alaskan, I say not only NO but HELL NO!
I believe that the post Covid US Airline industry will yield a number of unlikely mergers due to the pilot shortage related issues. These mergers will be done through necessity not convenience. We have never seen anything like this.
I think you are correct. And in ten years they will have a surplus and massive layoffs will ensue.