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exusair
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Posts: 658
Joined: Fri Sep 08, 2000 12:15 am

JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 10:38 am

I was wondering who the tenants were in JFK's Pan Am, TWA and Tower Air's Hangers and if JB was moving into one of them, or if they were already there.

JB has a high degree of utilization and I was also curious as to whether they had line maintenance in cities other than JFK to keep their planes flying.

Are they JB mechanics or contract guys.

Here in ATL, AirTran is either having a hanger built, or they were going to move into NWA's hanger since they are leaving town.

The maintenance issue comes up since I recall AWA outsourcing their heavy maintenance several years ago with disastrous results in terms of quality of work performed and schedule overruns. AWA has since reigned in all maintenance functions and performs all of its own work so far as I can glean.

In the next 3-5 years, they will have scores of planes due for HMV's. Will they have the facilities to mitigate down time?
 
DC10GUY
Posts: 2590
Joined: Fri Feb 18, 2000 5:52 am

RE: JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 10:46 am

JB Is making money because they don't have aircraft maint. expense ... I think they will avoid it as long they can ....
Next time try the old "dirty Sanchez" She'll love it !!!
 
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LAXintl
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Joined: Wed May 24, 2000 12:12 pm

RE: JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 11:30 am

JetBlue was getting maint support from Air Canada in the begining. Recently all overhaul work was transferred to EADS in Lake Charles LA.

From the desert to the sea, to all of Southern California
 
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STT757
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Joined: Tue Mar 28, 2000 1:14 am

RE: JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 12:01 pm

Right now no one is using the TWA or the Tower air hangar, the Pan Am 747 hangars were being used by UAL (not sure if the still are).

I read recently in NY Crains business (or perhaps another source) that the City of NY's economic development agency was preparing to issue bonds to fund construction of a new two bay hangar at JFK for Jetblue, it said the project entailed demolotioning two older structures on the site.

Not sure the status of this, or where exactly they are refering to at JFK.
Eastern Air lines flt # 701, EWR-MCO Boeing 757
 
Jeff G
Posts: 440
Joined: Fri Jan 18, 2002 9:56 am

RE: JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 2:35 pm

Of course JetBlue has line maintenance. You can't do much without it. JetBlue has a number of stations with in house line maintenance and all other stations have contract maintenance on demand. Heavy checks are accomplished in Lake Charles as Laxintl states. And DC10guy's comments to the contrary, JB does incur maintenance expenses, but they are significantly mitigated for now since the airplanes are all still under warranty. JB is planning to build a hangar in JFK, but my guess is that it will be for routine maintenance only, not heavy maintenance.
 
AerMickey
Posts: 85
Joined: Mon Jan 13, 2003 12:55 pm

RE: JetBlue A/C Maintenance Programs?

Wed Apr 16, 2003 11:17 pm

Jetblue will have plenty of maintenance in the days to come. Just like all the mechanics I know from United. The Airbus is their best friend. Why? They spend the most time working on them.

Mick
 
BeltwayBandit
Posts: 474
Joined: Tue Mar 11, 2003 4:25 am

RE: JetBlue A/C Maintenance Programs?

Thu Apr 17, 2003 12:14 am

Philosophical question. When maintenance burden is not reflected on financial statements, is it still maintenance?
 Big grin

[Edited 2003-04-16 17:16:30]
 
Jeff G
Posts: 440
Joined: Fri Jan 18, 2002 9:56 am

RE: JetBlue A/C Maintenance Programs?

Thu Apr 17, 2003 1:15 am

Philosophical water-muddying: If much of the cost of maintenance is shifted to higher aircraft acquisition costs, is maintenance still "free"?
 
adh214
Posts: 362
Joined: Thu Sep 16, 1999 6:07 am

RE: JetBlue A/C Maintenance Programs?

Thu Apr 17, 2003 5:01 am

I have an accounting question with regard to maintenance. From an accounting perspective is maintenance capitalized or expensed at the time it is performed.

It would seem to me that heavy maintenance should be capitalized. My theory is that a C or D check lasts several years. Thus, bearing the entire cost of that maintenance in the year it is performed unfairly burdens that year's P & L. Further it distorts the value of the fleet as a plane that is 10 minutes from a D check is worth a least a few hundred thousand less than a plane that is just leaving a D check.

Anyone with airline accounting experience care to comment on this?



(As a side note, I do not work in the airline industry and I am not an accountant. However, I do have an MBA and I am not 14 years old.)
 
exusair
Topic Author
Posts: 658
Joined: Fri Sep 08, 2000 12:15 am

RE: JetBlue A/C Maintenance Programs?

Thu Apr 17, 2003 6:28 am

I recall reading annual reports for airlines over the past several years. When reading the notes regarding expenses and "extraordinary items" I have found that maintenance issues were expensed in the year in which they occur.

If a carrier puts aside funds for future maintenance expenses, it is either lumped in with "cash" or can be seen as an expense under "capitol expenses."

Items can also be placed under a "nonrecurring cost", so there are many ways in which you can account for maintenence costs. I understand that it can skew a P & L for a year, but it is a cost directly associated with the ability to conduct business.

I too am curious as to the valuation of an airframe that pre and post heavy mtc visits. Does a company have to begin devaluation upon receipt, or can they lump sum the depreciation when the equipment is sold or retired.

There are suspicions amongst my colleagues that the airlines are skewing their depreciation models and incurring "theoretical" sums during these dark days. After all, if you lost $200 million on your operation in the past 6 months, why not throw in a/c and ground equipment depreciation for another $150 million? Then cry poverty to your work groups and the government in the hope of pay cuts, work rule changes and government welfare assistance?

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