JetBlue and American Airlines surprised by the world by announcing a strategic partnership today that will introduce codesharing routes and reciprocal benefits for frequent flyers. While the “enemy of my enemy is my friend” argument comes into play, the move carves out spheres of influence that position both carriers to better recover from COVID-19.
The Details: JetBlue And American Airlines Strategic Partnership
American Airlines and JetBlue will cozy up in the following ways:
A Focus On Connectivity
American Airlines is weak in the Northeast, particularly out of New York (JFK). JetBlue is strong in both JFK and Boston (BOS). Today’s move includes an international route announcements from AA, including new service from JFK to:
- Tel Aviv
AA will also restore seasonal service to Barcelona to complement its service to London and Madrid. Milan, Paris, Zurich, and other routes are not returning at this time, but AA says “the new partnership is certain to facilitate American adding new long-haul markets in Europe, Africa, India and South America.”
While not stated, AA implies that its JFK hub and Boston focus city will shift into bases with emphasis on transcontinental and international travel, leaving most feeder traffic to JetBlue. New York is too big of a market to leave on the table but too difficult a market to tackle alone. Trough this complementarian approach AA and JetBlue hope to increase their market shares at the expense of Delta and United.
New Codeshare Agreement
A new codeshare agreement will cover 60+ routes operated by American and more 130+ routes operated by JetBlue. While the specifics have not been announced, I would guess most codeshare flights will be on routes where JetBlue and American do not directly compete. However, the press release mentions seamless premium transcontinental service between the two carriers, so we might see codeshares on markets like SFO-JFK and LAX-BOS.
Cooperation On Premium Transcontinental Routes
JetBlue and American Airlines both offer premium products between LAX/SFO and JFK. JetBlue also offers its Mint service on transcontinental routes to Boston and Ft. Lauderdale. The new partnership promises seamless connectivity on premium transcontinental flights, but how? Will there be reciprocal upgrades? Lounge access for JetBlue passengers? We just don’t know yet. I’ve reviewed AA in first and business class plus JetBlue in Mint Class. JetBlue offers a far superior product.
How Much Is Delta Driving This News?
Unmentioned in any press release by either American or JetBlue is Delta Air Lines, the penultimate driver of this change. It’s not just that American and JetBlue are looking to flourish in the post-pandemic world, which I’ll accept as a the primary reason for this new partnership. American and JetBlue are both looking over their shoulder at Delta, which has encroached into their former strongholds. US Airways and American Airlines used to be huge in Boston. Now they are are a shadow of their former self with Delta on the ascent. Delta has also grown in New York and Seattle, acting as a vacuum to the so-called “natural share” argument that ex-AA President and now United CEO Scott Kirby likes to make.
This move sets to slow Delta’s growth down by making it more attractive for flyers to stick to an Alaska-American-JetBlue market versus Delta. Sticking to any one carrier alone would not be enough to overcome Delta, but the trinity of carriers does offer a more realistic alternative to Delta.
How JetBlue + American Described The Strategic Partnership
JetBlue stresses its advantage over network carriers (including AA) on domestic routes while stressing that this agreement will feed traffic into its Northeast network. Joanna Geraghty, President and Chief Operating Officer, said:
“Pairing JetBlue’s domestic network with American’s international route map creates a new competitive choice in the Northeast, where customers are longing for an alternative to the dominant network carriers. This partnership with American is the next step in our plan to accelerate our coronavirus recovery, get our crewmembers and our aircraft flying again, and fuel JetBlue’s growth into the future.”
Meanwhile, American Airlines President Robert Isom focused on the ability of JetBlue-American as a combined alternative to the competition in New York and Boston:
“This is an incredible opportunity for both of our airlines. American has a strong history in the Northeast, and we’re proud to partner with JetBlue as the latest chapter in that long history. Together, we can offer customers an industry-leading product in New York and Boston with more flights and more seats to more cities.”
Isom underscores that a combined American and JetBlue will be able to more successfully challenge competition.
Will This Strategy Work?
These latest moves feel like AA’s own version of the 1945 Yalta Conference in Crimea, where Britain, the USSR, and the USA divided up post-war Europe into spheres of influence that would shape the world for years ahead. Here, it seems like AA is ceding the Northeast to JetBlue, the Northwest to Alaska Airlines, and hoping to save the residual for itself. The goal is peace and stability among frenemies. We all know how well that worked out at Yalta…let’s hope this arrangement turns out better.