JetBlue’s Two-Faced Approach To American Airlines

JetBlue appears to be talking out both sides of its mouth regarding American Airlines, happy to partner and challenge. What’s going on? 

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JetBlue Loves American Airlines In The Northeast

American Airlines and JetBlue Airways formed the Northeast Alliance (NEA) codesharing on routes in the Northeastern US corridor to compete with United and Delta who each have strangleholds on New York City metro airports Newark and JFK respectively. Initially, JetBlue and American promised “increased frequencies on more than 130 existing routes; 90 nonstop routes with increased capacity; and 17 new international routes launched.” It’s said that approximately 50 new routes have been launched as a result of the tie-up.

This included a combination of both daily summer seasonal service and year-round services spread across New York Laguardia airport and Boston Logan International airport primarily. The alliance states that it increases competition in the northeast by representing a challenge to the aforementioned carriers. Though approved by the outgoing Transportation Secretary, Chao, in 2021, the Justice Department is now suing the two carriers to break up the agreement.

JetBlue has been effusive in its support for American Airlines and even suggested it’d like to emulate American’s lucrative loyalty program.

Going to War In South Florida?

Through a single announcement of a new flight from Fort Lauderdale to Tallahassee, Florida (needed but not significant to the network) JetBlue made a proclamation of its future South Floridian dominance.

“As a customer-centric alternative to the high-fare legacy airline that dominates South Florida, we have achieved rapid growth in Fort Lauderdale and are ready to turbocharge further expansion once we combine with Spirit.” Robin Hayes, Chief Executive Officer, JetBlue” – SimpleFlying

What’s so odd about all of this is that the new route doesn’t start until January of 2024 (almost a year), it doesn’t necessarily foretell the completion of the Spirit merger or announce a “win South Florida at all costs” strategy. Elsewhere JetBlue suggests they will challenge the legacy airline in South Florida with competitive fares to the west coast in Mint and even to Europe.

What should be abundantly clear, is the legacy airline in question is JetBlue’s Northeast Alliance partner, American Airlines. The “high-fare legacy airline” commands just short of 70% of all passenger traffic in nearby Miami and sells flights to other South Florida airports including Fort Lauderdale.

Political Gamesmanship or a Preview?

It’s been widely speculated this week that for JetBlue’s other Justice Department showdown to be successful (yes, it has two potential lawsuits in progress against the government at the moment) JetBlue could only merge with Spirit if it were willing to sacrifice the Northeast Alliance. It’s important to note that the DOJ has not formally sued for the second matter yet, but even the most enthusiastic pundits don’t see a JetBlue future where it can operate both.

Assuming it is one or the other, is this a preview of how JetBlue will plan to operate South Florida after absorbing all of Spirit Airlines and its massive footprint? There’s no question that the acquisition of Spirit Airlines is the better long-term (and short-term) move for JetBlue’s Expansion and when given the choice, the Northeast Alliance would go away first.

Rather, could this be political gamesmanship? Using a single short-haul flight from Fort Lauderdale to Tallahassee to talk about future European network advances, and expanding to 250 flights from FLL seems odd. As mentioned this isn’t even a route set to start for more than 10 months, it feels like it was just the next opportunity to get some attention.

The question is whether that signals to the DOJ which has not yet sued that they can resolve both the NEA and Spirit question in one breath But it could also send a message to DOJ that it still sees American Airlines as a competitor and will call it out as such. Labeling it a “high-fare legacy airline” takes an open dig at American and shows that despite a partnership, the two remain competitors.

Conclusion

It’s unclear how JetBlue perceives its relationship with American Airlines to be one of partner or foe and whether that relationship changes based on the market itself. If American is a “high-fare legacy airline”, the utter antithesis of what JetBlue is selling” but only in South Florida, then I think the model is problematic. If It’s rather a case of Hayes indicating what he’s willing to do to grow his airline, then it also makes him someone that will say whatever he needs to get his way. Both the DOJ and customers should be wary if the latter is the case.