JetBlue to make big aircraft decisions soon

JetBlue is just about ready to publish its fleet review decision. What it says will determine the future of the airline.

If it modifies some of its A321 order to the Neo ULR version, with 4000 miles range, the airline will be embarking on trans-Atlantic operations. That’s something many of us in Europe would welcome. So far the reasonably priced low cost model has been entirely European driven over the Atlantic.

The A321 transcontinental Mint service has been wildly successful for JetBlue and highly profitable – take that over the Atlantic and they could be looking at another round of successful routes.

The benefits of trans-Atlantic to JetBlue’s operations with their transfers in New York to any other JetBlue service would be a huge opportunity.

JetBlue’s other big issue is what’s going to happen to the E-190 fleet?

These have not worked out as well as was hoped. The 100 seater has a cost higher than the airlines A320’s. Maintenance is higher, pilot training isn’t cross functional with the Airbus fleet.

Half of the E190’s are owned while the other half have leases expiring between 2023-25.

The trouble is the E190’s have a real impact on the high frequency business routes, but they still cost too much to run.

The CSeries which is proving in service to be wildly more economic than even Bombardier expected, is one option. Operators Swiss and AirBaltic are said to be delighted with them and they have the range to go anywhere domestic and still keep seat numbers low enough to justify the thin high frequency routes.

Another choice is the Embraer E2 series. Pilots would be familiar, the economy is better but not optimal. The airline has 24 E190 options it could potentially swap to E2, and the other half of the E190 fleet could be traded in for new ones.

The other solution is to go all-Airbus. Buy new A319neo for those 100 seat routes, maybe risk it and just go in all A320 and try and develop the business in other ways. Fleet costs would drop and the opportunity for flexibility across the fleet, improved utilisation, could easily outweigh other costs.

Analysts will be watching carefully. What JetBlue does next will determine its next 15 years of operations and therefore its profitability – that affects its stock price and that in turn determines how far, and how much, it can leverage its finances to move ahead.