Transcript jetBlue Airways.ppt

jetBlue Airways
By: Rachel Andersen, Joe Bossert, Jarvez Hall, Jeff
Hensley, Brandon Kirkbride and Adam Tolman
Agenda
• Strategy
• History
• Competitors
• Strengths/Weaknesses
• Competitive Advantage
• Facts
• Financials
• Advertising
• Future of Company
Strategy
• “Our goal is to establish jetBlue as a leading lowfare, low-cost passenger airline by offering
customers high-quality customer service and a
differentiated product. We strive to offer low fares
that stimulate market demand while maintaining a
continuous focus on cost-containment and operating
efficiencies. We intend to follow a controlled growth
plan designed to take advantage of our competitive
strengths. Our growth has occurred, and we believe
it will continue to occur, by adding additional
frequencies on existing routes, connecting new city
pairs among the destinations we already serve and
entering new markets often served by higher-cost,
higher-fare airlines.”
History
• February 11, 2001
• CEO David Neeleman: “Bring humanity
back to air travel”.
• Executive Team
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David Neeleman: Chief Executive Officer
Dave Barger: President & Chief Operating Officer
Thomas Kelly: Executive Vice President
John Owen: Executive Vice President & Chief
Financial Officer
More History
• First and only U.S. start-up airline to launch
with more than $100 million in capital
• Began with service between New York City
and Ft. Lauderdale, FL.
 2000: Flies its one millionth customer and reports $100
million in flown revenue for 2000.
 2001: Flies its two millionth customer.
 2002: Acquired 100% of the ownership interests in LiveTV.
 2003: Announces initial public offering of its common stock
 2004: Launches online flight check-in.
 2005: Receives FAA's highly coveted Diamond Certificate of
Excellence Award.
Competitors
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Southwest
American
Delta
Northwest
United
Continental
Pan Am
Horizon/Alaskan
Strengths/Weaknesses
• Strengths
• Low Operating Costs
• 6.03 cents mile vs.
10.91 industry
average
• 13.4 hrs average
utilization per aircraft
• Productive workforce
• Low distribution costs
• Direct Bookings
• Single aircraft
• New
• Brand
•Weaknesses
•Hubs
•Destinations
•Small Airlines
•Single Class
•Debt
•Floating interest
rates
•Additional
Financing problems
•Maintenance Costs
Competitive Advantages
• Bulletproof Cockpits
• Low fares
• Experienced Management
• Leather Seats
• DirecTV
• XM Radio coming soon!
Facts
FLEET:
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77 Airbus A320 aircraft , all
powered by International Aero
Engines (IAE) V2500 engines
JetBlue has orders with Airbus for
a fleet of as many as 233 A320
aircraft and has placed an order
with Embraer for a fleet of up to
200 EMBRAER 190 aircraft. The
first EMBRAER 190 aircraft will be
delivered in 2005.
JetBlue's A320 aircraft have a
single-class configuration of 156
seats, while the EMBRAER 190
will have a single-class
configuration of 100 seats.
All JetBlue's fleet is outfitted with
leather seats with free DIRECTV
programming® at every seat.
JETBLUE -- FIRST AND ONLY:
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First and only U.S. start-up airline
to launch with more than $100
million in capital
First and only airline to offer 24channels of live satellite television
free at every seat
First and only airline to broadcast
the Olympic Games live at every
seat
First U.S. airline to introduce
"paperless cockpit" flight
technology
Only U.S. airline to be 100%
ticketless
First U.S. airline to install bulletproof cockpit doors across its
fleet
First and only airline to install
security cameras in passenger
cabin for customer and crew
Facts
INFLIGHT ENTERTAINMENT
•A&E
•Animal Planet
•Boomerang
•Bravo
•CNBC
•CNN Headline News
•Comedy Central
•Court TV
•DIRECTV®
FREEVIEW®
•Discovery
•ESPN
•ESPN2
•ESPNews
•ESPN Classic
•Food Network
•Fox Movie Channel
•Fox News Channel
•FX
•GSN, the Network for
Games
•Hallmark Channel
•The History Channel
•HGTV
•MapQuest
•MSNBC
•MTV
•National Geographic
Channel
•Nickelodeon / Nick at
Nite
•SCI FI Channel
•Telemundo
•The Learning Channel
•Travel Channel
•TV Land
(Freeview/Specialty
Events on weekends)
•USA Network
•VH1 Classic
•The Weather Channel
•WNBC
All JetBlue aircraft are equipped with an in-seat
digital entertainment system (individual seatback
monitors, armrest remotes with channel and volume
controls) offering 36 channels of free DIRECTV®
programming - no other airline offers more live
satellite TV options. On flights longer than two hours,
a selection of first-run movies and bonus features
from FOX InFlight is also available. Over the next
few months, we will be upgrading our entire fleet to
include 100+ channels of XM Satellite Radio.
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Cities Served
Aguadilla, Puerto Rico
Boston, MA
Buffalo, NY
Burbank, CA
Burlington, VT
Denver, CO
Fort Lauderdale, FL
Fort Myers, FL
Las Vegas, NV
Long Beach, CA (near Los
Angeles)
Nassau, Bahamas
New Orleans, LA
New York City, NY (JFK)
New York City, NY (LaGuardia)
Newark, NJ (service starts October 5,
2005)
Oakland, CA (near San Francisco)
Ontario, CA (near Los Angeles)
Orlando, FL
Phoenix, AZ
Ponce, Puerto Rico
Portland, OR
Rochester, NY
Sacramento, CA
Santiago, Dominican Republic
Salt Lake City, UT
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San Diego, CA
San Jose, CA
San Juan, Puerto Rico
Seattle, WA
Syracuse, NY
Tampa, FL
West Palm Beach, FL
Washington, DC
Financials – Cost Structure
Advertising
Amy Curtis-McIntyre, VP of Marketing
• “Advertising is the last thing you bring to the mix. You start by
getting the product right, getting your attitude right, getting
everyone internally understanding the mission. Then you move
to telling the story through PR. You build the advertising last,
and that way you can live on realistic budgets”
• Commercials
An Inside Look
• Tour
• In flight Entertainment
• Blue Cities
The Unadvertising
• Hot Shorts
• AMERICAN EXPRESS AND JETBLUE®
AIRWAYS EXTEND PARTNERSHIP WITH NEW
COBRAND CREDIT CARD AGREEMENT
• “Our partnership with JetBlue is another way we can offer consumers
rewards products to fit their lifestyle with brands that have their
loyalty.” Al Kelly, American Express.
• “JetBlue is committed to finding new and innovative ways to offer our
customers more ways to save and partnering with American Express
will enable us to do just that.” David Neeleman, CEO, JetBlue
You can purchase more than a flight
Stock price
Future of the Company
• Expected Increase 4-5%
• Expected Operating Capacity
• 27-29%
• 15 new aircrafts
• 22% fuel costs hedged at $1.17 gal.
• Expected Operating Margin 7-9%
Sources
• http://home3.americanexpress.com/corp/pc/2005/t
rueblue.asp
• http://archives.californiaaviation.org/airport/jpg006
00.jpg
• http://www.jetblue.com/
• http://quotes.nasdaq.com/asp/summaryquote.asp?
symbol=JBLU%60&selected=JBLU%60
• http://64.106.229.11/jetblue2004/balance.html
• http://www.brandingblog.com/2004/05/branding_at
_jet.html
• http://www.sjc.org/AirportReport/Mar04/AR_conten
t.html
• Just to end
Questions?