Much digital ink has been shed about jetBlue’s announcement that they’ll be adding (essentially) business class seats (similar to what SWISS has) to a handful of their new A321 aircraft for transcon flights between New York and LAX/SFO. Reactions ranged from apoplectic that these (incorrectly it turns out) seats could be ANGLED LIE FLAT – HOW COULD SOMEONE ENDURE THAT HORROR FOR 4 HOURS AND 27 MINUTES??????? To Cranky’s more down-to-earth overview, which I’ll link to here rather than regurgitate.
I just thought I’d throw this out there:
jetBlue is putting these seats in because they believe that they can’t compete for the business traveler unless they offer a premium cabin. Delta, American and United have all been upgrading their premium cabin on Transcons (or are in the process thereof) offering lie-flat seats on the 4.5-6 hour journeys. Their front cabins on transcons are filled with people flying on corporate deals (where they have to choose that airline), Elites who have upgraded themselves (free upgrades are difficult to come by — or are not offered at all — on these routes), with much of the remainder going to airline loyalists who choose to fly a given airline because of the miles.
jetBlue will have a difficult time grabbing many of these travelers. Corporate contracts are already in place, with banks, movie studios and others who fly those routes frequently tied in with legacy carriers. Loyalists pooh-pooh jetBlue’s frequent flyer program (rightfully so) because of the lack of international redemption options (among other reasons).
Lots of articles I’ve read about this suggest that jetBlue is going after legacy carriers on these routes with the new product. But I don’t think that’s true. I worked for EOS Airlines, which was competing (on some level) with MAXjet and Silverjet to offer all-premium-service flights between New York and London. They had a good product at a great price. And they all failed. Why? Lots of reasons, but in large part because business travelers were locked in with legacy airlines, and those arrangements (plus the pull of their frequent flyer programs) made it difficult to compete. Plus – they were constantly being matched on price, taking that advantage away because legacy airlines had deep pockets. If jetBlue’s plan is to compete with AA, UA, and Delta for those same customers, I think they lose.
But jetBlue is run by smart people, and I suspect they have a different target. Virgin America’s much-beloved product (if you have tech-y friends, you’ve been probably endured listening to them blabber about it nonstop) offers just a recliner seat up front on their transcons. Oh, and they’ve lost money hand-over-fist. And they share a similar, younger demographic with jetBlue. Is jetBlue thinking they can off Virgin America, by offering a wayyyyyy better front cabin for the same price that Virgin America offers their suddenly-crappy product? And Virgin America couldn’t really handle a price war for a prolonged period because they’re a bit cash strapped for that. Nor will they likely be able to make the investment in lie-flat beds in their planes.
If that’s their strategy (and I’ll assume it is), then bravo to jetBlue. Well played. Good luck competing with that, Virgin America.