GoBlue
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B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 9:16 am

Looking for some insight into these two ideas here. Firstly this has puzzled me for a long time, and i know that many of you may think this is a logical situation, but there are so many oppourtunites to take advantage of ailing carriers.

Why does B6 not choose an american legacy that it perceives to be weak, i.e NWA, DL or AA, and focus some of its grow into its key hubs etc. JFK can pretty much sustain growth to major cities like DTW, MSP, CLE, IAH, IND, ATL, CVG. B6 could work on establishing their brand there, while working on getting more north east air travel business. Brand recognition is so important these days, that even a small foray into these cities can be expected to bring results.

I know a few factors play into this scenario.. Lack of international feed at JFK, which i beleive they are working on right now with some carriers, and fleet availability. But an E190, is a great plane to offer a few flights a day to a city you want to slowly grow. I just feel that B6 is not pouncing on those carriers, who can least afford the competition.

From a business perspective this just seems to be a place where this carrier is lacking.

Thoughts?
 
artsyman
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 10:34 am

Why does B6 not choose an american legacy that it perceives to be weak, i.e NWA, DL or AA, and focus some of its grow into its key hubs etc
****

Because more or less every time it has tried, it gets it's butt handed to it on a plate. DL chased Jetblue out of ATL pretty quick and Continental certainly made life miserable for them at EWR.
 
HVNandrew
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 10:46 am

Great ideas, afterall, ATL worked out so well for B6 in the past.
 
GoBlue
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 10:56 am

I would assume that had B6 doen this from JFK that they would still be there, they also have the E190 which is in my experience is a much better plane then a regional jet to make connections.
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:06 am

Yeah, they did a good job coming into PIT to go against stronghold USAir... PIT travelers are still laboring under the delusion that US is the only carrier there. When B6 entered PIT, US matched the fares, and natureally, it looks like US is holding onto their loyal travelers, while B6's E90s go mostly empry to JFK and BOS.

Hopefully, and I stress "hopefully," this will change, and people will start to recognize B6 and their presence at PIT...
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
exFATboy
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:32 am

Quoting GoBlue (Thread starter):
Why does B6 not choose an american legacy that it perceives to be weak, i.e NWA, DL or AA, and focus some of its grow into its key hubs etc.

Because if B6 tried to go into another airline's hub with a lot of new routes, the retalitatory response from the attacked hub is likely to render the new routes unprofitable for too long.

I think what we're going to see in future is if B6 wants to serve another carrier's hub, it'll handle it as they are ORD now - initially just service to some combination of their "key cities": JFK, LGB (if slots are available), BOS, FLL, and OAK. This should let them get a decent load factor almost from the start, as loyal B6 customers from the key cities fly to the new destination and back again. As B6 builds up visibility in the new city, it'll put them in a good position to eventually launch additional routes.

This was sort of what they tried in ATL, but keep in mind that JetBlue was a much smaller airline, and IIRC they tried to do it "on the cheap" with late-night flights. I think they could eventually try ATL again, but there's other opportunities for them to pursue first.

There might have been a window of opportunity when "old US" was on the ropes to invade Charlotte, but B6 simply didn't have the available metal to go in in a big way.
 
AASTEW
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:34 am

Because B6 doesn't use the same strategy as the successful WN. When you enter a major hub with competition from a legacy airline you have to come with force. Just ask FL what happenned to their so-called DFW focus city!
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:39 am

Quoting AASTEW (Reply 6):
Just ask FL what happenned to their so-called DFW focus city!

Or their entrance into PIT back in 2000 with flights to many stronghold US markets out of there. Those routes did not last very long!
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
GoBlue
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:44 am

Quoting ExFATboy (Reply 5):
I think what we're going to see in future is if B6 wants to serve another carrier's hub, it'll handle it as they are ORD now - initially just service to some combination of their "key cities": JFK, LGB (if slots are available), BOS, FLL, and OAK. This should let them get a decent load factor almost from the start, as loyal B6 customers from the key cities fly to the new destination and back again. As B6 builds up visibility in the new city, it'll put them in a good position to eventually launch additional routes.

Welcome to my respected users list, this is exactly what i was stating in terms of the new city endeavours. I think that the only city they would have trouble with would be OAK because it is a WN stonghold... i would love to see them launch routes into hubs with 2-3x a day flights from there major cities..

With more metal on the way we will see what they can come up with
 
dutchjet
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:46 am

Taking on an established legacy carrier at one of their hubs is a very very difficult proposition......its difficult being the underdog and very risky financially. JetBLue could jeopardize their future by making such a move....and could quickly wipe out everything they have achieved so far by going head to head with another carrier at one of their hubs. As mentoned above, when JetBlue has attempted this strategy in the past, it has not worked out well for them: ATL was a problem and EWR has certainly not developed as JetBlue had hoped. While JetBLue is a good product, I think that JetBLue underestimated how strongly the hometown airline will fight to protect its turf, and also underestimated that pax tend to be loyal to their hometime airline and will not necessarily try the new airline. The post above about PIT is absolutely fascinating......US has screwed PIT big time yet pax in the PIT area seem to remain loyal to that airline.

Southwest, for example, grew into a huge airline and until recently, seemed to avoid hub cities of the legacy carriers.

Thus far, JetBlue has been clever with its route system, and has grown without getting into too many contests with other airlines. DL and AA have not seriously responded to JetBlue's unfettered growth at JFK, JetBlue has a controlled niche at LongBeach, Boston worked out far better than anyone could have expected with JetBLue establishing itself at that city seemingly without DL and US, the two bigger players at BOS, even taking notice.

Of course the big question for JetBlue is: What's next? There are a lot of airplanes on order that must be put to productive and profitable use. Continuing to throw more and more capacity on the highly travelled NYC-FLorida and NYC-California routes is no longer the answer due to the revenue issues that JetBlue ran into months ago. Continued growth out of JFK and BOS is a certain, but there are limits even at these successful cities, EWR did not work out as well as planned and LGA is slot controlled, there is a lot of competiton at IAD, and LongBeach is also limited. A new hub/focus city is key - but where? That gets back to your original point, JetBlue needs to identify a major city where it will NOT have to compete with a legacy carrier AND will not have to go head-to-head with Southwest on each and every important route. And the city selected by JetBLue should be able to generate a reasonable amount of O&D traffic.....a hub that works mainly as a connecting point will not work under JetBlue's business model.

Get out your maps.......how does Austin sound?
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:52 am

Quoting Dutchjet (Reply 9):
The post above about PIT is absolutely fascinating......US has screwed PIT big time yet pax in the PIT area seem to remain loyal to that airline.

I was referring to a time before the US screwing bit, although, PIT and US kinda screwed each other. FL did have an opportunity to jump back in in late 2003 when US made the announcement of the hub closure, but they did not. Long story, huge can of worms, I would rather avoid it, and I am sure the other 1,000+ A.net members would too! If you would like to hear about that though, fill free to drop me an instant message!  Smile
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
Cubsrule
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 11:53 am

B6 and US seem to be coexisting fairly well in CLT. US made a half-hearted attempt at retaliation with 3x CLT-JFK on CR9s, but it might be argued that US was simply availing themselves of an existing HP station which fits well on their route map. B6 loads seem to be hit or miss. I have no idea how full the YV flights are going out.
I can't decide whether I miss the tulip or the bowling shoe more
 
gregarious119
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:13 pm

I'm still amazed that B6 hasn't waded into the waters at PHL, or any of the surrounding area yet. That seems to be a gaping hole for them on the east coast. Probably not the gaping hole like ORD is, but it's still one of the best O&D areas in the country, and they're not anywhere around it.
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:16 pm

Quoting Gregarious119 (Reply 12):
I'm still amazed that B6 hasn't waded into the waters at PHL

I don't think they want to have a reputation just yet of having their planes 40 minutes behind schedule, just a shot in the dark!
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
sllevin
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:22 pm

The reality is that B6 cannot afford to get into any price wars right now. Despite having planes flying largely full, they are not really making any money. They could easily go into any hub and get their planes full, but they aren't going to get the highest fares, because competitors are obviously not allow themselves to be undercut on price alone.

Right now jetBlue needs to find city pairs where it can get good loads AND good yields. Getting good loads simply isn't enough.

Steve
 
jetbluefan1
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:37 pm

Quoting Dutchjet (Reply 9):
Get out your maps.......how does Austin sound?

That's exactly what I was thinking. AUS seems largely underserved - it's a huge city with relatively little service and competition. B6 does great on its JFK and BOS runs.

Quoting Cubsrule (Reply 11):
. B6 loads seem to be hit or miss.

Not really. CLT has been really successful for B6 since the start. It has been so successful that 2 of the E190 flights have been made into A320 flights.

If anything, RIC loads are hit or miss.

JetBluefan1
 
jfk69
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:39 pm

I am constantly shocked by PIT. I fly down there from JFK about 5 - 7 times a year and I used to fly USAIR. Not because I wanted to, but because they were the only damn airline. The prices sucked, the service sucked, and there was really nothing you could do about it. Then when B6 came in I was jumping for joy. Now for the most part my flights have been packed, but I hear that a fair amount go out empty. The locals tell me that half of them have no clue B6 is operating in PIT. The advertising has been horrendous. The poeple of PIT better open their eyes, or else the days of crappy USAIR will monopolize again.
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:45 pm

Quoting JFK69 (Reply 16):

I guess I am the only one with his eyes open... and my fellow PDA colleagues  Wink (PDA = PIT Diehards Association)
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
B6WNQX
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:48 pm

Quoting JetBluefan1 (Reply 15):
AUS seems largely underserved - it's a huge city with relatively little service

If I am not mistaken, their are not a lot of gates available in AUS. It would be nice though and a good place to route some E190's to the west coast when they decide to finally do that. Someone from WN, AA, or FedEx might be able to shed some more light onto the gate situation in AUS.
 
JetBlueAUS
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 12:53 pm

Quoting JetBluefan1 (Reply 15):
That's exactly what I was thinking. AUS seems largely underserved - it's a huge city with relatively little service and competition. B6 does great on its JFK and BOS runs.

The only problem with Austin is that there are only 25 gates and almost all of them are occupied. I would love to see AUS become a stronghold for B6. However, the only problem is... the airport's size.
Not all of us can be heroes, some of us can only stand on the sidewalk and clap as they go by.
 
Cubsrule
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 3:13 pm

Quoting JetBluefan1 (Reply 15):
It has been so successful that 2 of the E190 flights have been made into A320 flights.

Which 2 is it? I just ask between 1086 (the afternoon flight) is the one that has seemed thin at times.
I can't decide whether I miss the tulip or the bowling shoe more
 
jetbluefan1
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RE: B6 Vs The Legacies In Their Own Hubs

Fri Dec 08, 2006 9:12 pm

Quoting Cubsrule (Reply 20):
Which 2 is it? I just ask between 1086 (the afternoon flight) is the one that has seemed thin at times.

Hmmm that I'm not sure about. Hopefully a B6 employee can shed some light?

JetBluefan1
 
B6JFKH81
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 5:49 am

Quoting JetBluefan1 (Reply 21):
Hmmm that I'm not sure about. Hopefully a B6 employee can shed some light?

Looks like we went back to E190 for the holidays to get the A320's on the real heavy demand flights (JFK/BOS - Florida)
"If you do not learn from history, you are doomed to repeat it"
 
ScottB
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 6:39 am

Quoting JetBluefan1 (Reply 15):
AUS seems largely underserved - it's a huge city with relatively little service and competition

AUS is neither "huge" nor "underserved." The Austin metro area is the fourth-largest in the state behind Dallas/Fort-Worth, Houston, and San Antonio. Austin already boasts non-stop service to the vast majority of its top markets and to almost any city B6 might choose to serve from there. The largest airline at AUS is WN, and the other two of the top three, AA and CO, are the two strongest network carriers.

While high tech has contributed to Austin's growth in recent years, two of the important drivers of the local economy are the state government and the University. Without intrastate service, B6 has little hope of capturing significant business from either.

The problems for B6 if they were to try to "invade" a legacy hub essentially come down to passenger preference and the ability of the incumbent network carrier to price match. B6 doesn't have deep enough pockets to sustain ongoing losses in a fight for traffic at a network hub, and most of the network hubs now worth "invading" have reasonably well-liked incumbents. Sure, they could try going into STL (ignoring the large WN presence), MEM, CVG, SLC, etc. -- but the traffic numbers at these hubs, even with low-fare stimulus, probably aren't worth the cost of competing for the traffic at this point. EWR has been a dud for B6 because CO is an effective competitor and generally has a reputation for a quality product.

WN has been very opportunistic in entering failed or weak hubs. PHL was extremely well-considered, given that the incumbent carrier had gained a reputation for expensive and poor service in the local market. BNA, MDW, and BWI all took advantage of major service reductions by an incumbent carrier.
 
jetbluefan1
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 7:27 am

Quoting ScottB (Reply 23):
AUS is neither "huge" nor "underserved."

Sorry, I should have clarified. AUS is "huge" or "underserved" in the respect that it is placed very well from a geographic standpoint, though it hasn't become a hub or even focus city for any airline. Connections are virtually nil, though the city is so well positioned to handle east-west connections from Florida and such, as well as north-south connections to Mexico. In other words, AUS has so much potential yet it hasn't been exploited.

Take a look at CVG and SLC. DL has made those two airports into huge operations even though the cities are actually not that big. Same thing goes with CO at CLE, though it has been scaled back. NW at MEM is another example. You see - B6 has focus cities in some major cities throughout the U.S - New York City, Boston, Washington, Orlando, South Florida, San Francisco Bay, LA Basin - yet there is nothing that is truly centrally located that can handle connections for a large portion of the country. AUS seems to be the perfect city for such criteria.

Quoting ScottB (Reply 23):
EWR has been a dud for B6 because CO is an effective competitor and generally has a reputation for a quality product.

Not to start an argument here, but EWR hasn't been a "dud." In fact, I have read several reports that claim that B6 is doing just fine at EWR. I even have a Lehman Brothers report that shows most EWR routes performing above first-year RASM averages for B6. If anything, EWR just doesn't pose the type of growth potential to make B6 a major player there (mostly because of the fact that JFK is down the road, congestion at EWR, and going head-to-head against CO on non-leisure routes would be unprofitable).

I think that B6 could do just fine entering legacy hubs, but only if they do so strategically. Offering leisure flights is a great way to do it. While leisure destinations, such as MCO, may be low-yielding, JetBlue has proven MCO to also be very profitable (according to a different report, JFK-MCO is the most profitable route in the network). Also connecting the legacy hub with JFK is a great strategy since it allows for many connections, as well as the fact that New York City is JetBlue's largest customer base.

JetBluefan1
 
dutchjet
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 8:54 am

Quoting JetBluefan1 (Reply 24):
Not to start an argument here, but EWR hasn't been a "dud." In fact, I have read several reports that claim that B6 is doing just fine at EWR. I even have a Lehman Brothers report that shows most EWR routes performing above first-year RASM averages for B6. If anything, EWR just doesn't pose the type of growth potential to make B6 a major player there (mostly because of the fact that JFK is down the road, congestion at EWR, and going head-to-head against CO on non-leisure routes would be unprofitable).

Let me see, how do I say this without being attacked as anti-JetBlue?

JetBlue did not do as well at EWR as was originally hoped. JetBlue's performance at EWR is simply ""OK""......and serving EWR on key routes to Florida is a good thing for JetBlue marketing as they offer service from all three major NYC airports. But, for many reasons, JetBlue's growth possibilities at EWR are limited, mainly because of the stregnth of CO at that airport. I do think that JetBlue underestimated how strongly CO would protect its turf and also underestimated loyalty to CO by its passengers. That the EWR routes are doing better than other JetBlue routes on a RASM basis is nice, but not really conclusive of anything.....JetBlue itself said that it has a revenue problem and is working hard to correct it.

I do think that JetBlue will remain at EWR and continue to fine tune their routes and frequency out of the airport. The Florida services do OK....and whether JetBlue offers service on the EWR-TPA route is not a big deal, JetBlue will figure out which routes make money. But a huge expansion by JetBlue out of EWR is not likely to happen....it would be a mistake. To be honest, I dont know if JetBlue itself had ever envisioned a large operation at EWR, or was it only the JetBlue gang at a.net that was convinced that JetBlue would become a major player at EWR?

Quoting JetBluefan1 (Reply 24):
AUS seems to be the perfect city for such criteria.

I tend to agree, while AUS, like every potential hub city, has its issues..it does seem to be a candidate for JetBlue's next hub/focus city. Other possibilities are MCI (although no airline to date has been succesful with MCI hub operations and Southwest is a major player at that airport) or maybe MSY (an outside the box idea).

Quoting JetBluefan1 (Reply 24):
I think that B6 could do just fine entering legacy hubs, but only if they do so strategically. Offering leisure flights is a great way to do it. While leisure destinations, such as MCO, may be low-yielding, JetBlue has proven MCO to also be very profitable (according to a different report, JFK-MCO is the most profitable route in the network). Also connecting the legacy hub with JFK is a great strategy since it allows for many connections, as well as the fact that New York City is JetBlue's largest customer base.

Interesting info......I agree with your points. That JFK-MCO is the most profitable route in the JetBlue network is a surprise, I would have guessed JFK-FLL.
 
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northwestEWR
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 8:57 am

Quoting Dutchjet (Reply 25):
Other possibilities are MCI (although no airline to date has been succesful with MCI hub operations and Southwest is a major player at that airport) or maybe MSY (an outside the box idea).

Besides WN, MCI also has YX which is slowly building MCI.
With both WN and YX I think MCI is out.
Northwest Airlines - Now You're Flying Smart
 
dutchjet
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 8:58 am

Quoting NorthwestEWR (Reply 26):

Besides WN, MCI also has YX which is slowly building MCI.
With both WN and YX I think MCI is out.

Good point, thanks, I honestly forgot that YX is quietly building up is operations at MCI.
 
steeler83
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 9:00 am

Quoting NorthwestEWR (Reply 26):
Besides WN, MCI also has YX which is slowly building MCI.
With both WN and YX I think MCI is out.

And they already fly to LGA from MCI.
Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
 
jetbluefan1
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 9:15 am

Dutchjet,

That was really a great post. I do agree with your points - and it wasn't anti-JetBlue. Very objective.

Quoting Dutchjet (Reply 25):
That the EWR routes are doing better than other JetBlue routes on a RASM basis is nice, but not really conclusive of anything.....JetBlue itself said that it has a revenue problem and is working hard to correct it.

One thing that I should clarify is that the EWR RASM was compared to first-year RASM growth on all B6 NYC-Florida flights.

Quoting Dutchjet (Reply 25):
Interesting info......I agree with your points. That JFK-MCO is the most profitable route in the JetBlue network is a surprise, I would have guessed JFK-FLL.

JFK-FLL was once the most profitable, but it actually fell pretty hard last year. I'm not too sure why, though it probably has to do with the deep discounts that were made as a result of added capacity as well as Song.

JetBluefan1
 
dutchjet
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 10:13 am

Quoting JetBluefan1 (Reply 29):

JFK-FLL was once the most profitable, but it actually fell pretty hard last year. I'm not too sure why, though it probably has to do with the deep discounts that were made as a result of added capacity as well as Song.


Think hurricanes......Fort Lauderdale took a hit last in late 2005/early 2006 as it cleaned up after the hurricanes. Wilma gave Fort Lauderdale a good hit, as you probably know looking at your signature. My partner and I have a second home in Fort Lauderdale and it took quite a while for things to get back to normal; jetBlue is really popular with the second home crowd that goes back and forth between BOS/NYC and FLL/PBI.....and a lot of those folks were avoiding Florida for a period while things were being repaired, and as their homes were put back into order, etc etc. I think that JetBlue, more than other carriers on the FLL routes, felt this simply because jetBlue is so popular with this segment.

Quoting JetBluefan1 (Reply 29):
That was really a great post. I do agree with your points - and it wasn't anti-JetBlue. Very objective.

Thanks, its frustrating, in other threads, when I have posted about the JetBlue and EWR situation, I was accused of being anti-JetBlue simply because I said that JetBlue did not do as well as hoped at EWR. The same has happened when the JetBlue revenue/reduced growth topic comes up....is the fact that JetBlue has to reduce its growth a good thing? No. Is the fact that JetBlue recognized that it had a problem and doing something about it a positive step? Absolutely.

In any case, it will be interesting to see what JetBlue does next.....I would assume decisions must be made soon as, even with the revised delievery schedules, JetBlue has many airplanes on order that must be put to productive work.
 
Cubsrule
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RE: B6 Vs The Legacies In Their Own Hubs

Sat Dec 09, 2006 1:07 pm

Quoting JetBluefan1 (Reply 24):
I think that B6 could do just fine entering legacy hubs, but only if they do so strategically. Offering leisure flights is a great way to do it.

It seems like B6 is doing just this. They haven't shown a single strategy when they have entered legacy hubs, and in fact, their strategies for individual hubs have changed as time has passed (see ORD). But look at EWR versus CLT versus ORD. We can't judge the success of ORD yet, but it's three very different strategies for three very different markets. There's no single right answer, and that's the key. The way they handled ATL was a serious mistake. I wouldn't look for that colossal a screwup again.
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