The Big Deal – JetBlue and American – Our Take

By | April 1, 2010
NEW YORK - APRIL 10:   Travelers look out at A...
Image by Getty Images via Daylife

There is a lot here to go over. JetBlue Airways and American Airlines have signed an interline deal, and American is ramping up in New York at both LaGuardia and JFK. So, let’s summarize the developments before we analyze them.

New American Routes

  • By year end at LaGuardia and JFK, American will add 31 flights to 13 additional routes, bringing the total to 216 daily departures to 63 unique destinations
  • JFK
    • Previously announced service to San Jose, Costa Rica; Madrid, Spain; Manchester, UK; and Austin, TX
    • New Twice-Daily Nonstop Service to Ft. Lauderdale in November
    • Increased Frequencies to Orlando, Las Vegas, and Miami in November
    • Previously American Eagle service to Columbus, OH and St. Louis, MO.
    • New twice daily American Eagle service to Indianapolis, IN and Cincinnati, OH, and once daily Eagle service to Norfolk, VA.
    • Two-class CRJ-700s on existing routes to Washington National, Boston, and Toronto early next year.
    • Considering a proposal by the Port Authority to expand their terminal to allow co-operation with British Airways.
  • LaGuardia
    • Two-class CRJ-700s will also fly new routes four times daily to Minneapolis, seven times daily to Atlanta, and five times daily to Charlotte.
    • Upgrades to Two-Class CRJ-700s to Toronto and Raleigh-Durham
    • Increase in frequencies to Miami and Chicago
    • Remodel of LaGuardia Admirals Club
    • Renovation of Concourse D, including all new ceilings, lighting, terrazzo flooring, wall panels and flight information displays. This should take two years, after which the same will be done to Concourse C.
    • Exploration of options to connect the two concourses behind the Security checkpoint
  • JetBlue
    • New Interline Agreement
    • Connections to/from American Flights in 18 noncompeting domestic markets and connections to 12 international markets. The JetBlue markets include: Buffalo, Burlington, Denver, Fort Myers, Houston Hobby, Jacksonville, Nantucket, New Orleans, Phoenix, Portland ME, Portland OR, Richmond, Rochester, Salt Lake City, Sarasota, Syracuse, Washington-Dulles, and West Palm Beach.
    • The American international destinations include: Barcelona, Brussels, Buenos Aires, London Heathrow, Madrid, Manchester, Milan, Paris, Rome, Sao Paulo, Tokyo, and Zurich.
    • JetBlue will receive 8 slot pairs at Washington National and one at Westchester County Airport in White Plains, and will cede 12 slot pairs at JFK to American.

This agreement is certainly fascinating. Delta has been saying it intends to be the dominant carrier in New York, and American and JetBlue are working together to to ensure they don’t get squeezed out. The interline between JetBlue and American only covers markets they aren’t competing in. In exchange, JetBlue not only gets business on some of their regional routes, but access to Washington National, another closed market.

JetBlue has not publicly announced what they will do with those slots. Unless American is giving up on New York to Washington, we can’t see them trading slots to JetBlue just to compete with them. On the other hand, American is adding service to Florida, which is a long-time part of JetBlue’s business.

Further cooperation may come. For JetBlue, we could see many more of these alliances. They aren’t getting into the transatlantic or transpacific business any time soon, but can do well feeding connections with multiple international carriers. It is a win-win situation. Swelblog on Airlines asked the question of whether or not JetBlue was going the Alaska Airlines route, trying to keep itself relevant in its home markets by becoming the domestic feeder for as many airlines as possible?

On the other hand, we agree with the Cranky Flier, who pointed out American’s tendency to try and crush new airlines, including dumping 757s into Long Beach when JetBlue started there. But, apparently, their desire to beat Delta, as evidenced by their plans to add frequencies to Minneapolis and Atlanta…Delta strongholds, and to Chicago to compete with Delta’s plan to run Shuttle service.

LaGuardia and Kennedy are the hometown airports of Flight Wisdom, and we have a vested interest in seeing not only service improve, but healthy competition. Airline Wars may lower prices in the short term, but eventually, someone wins and the prices jump back up.