Topic > Jet Blue Airways Analysis - 1858

JetBlue Airways Corporation was a fast-growing discount airline and the industry's biggest success story, using its strong customer service considerations and low fares to build a base of solid and growing customers. David Neeleman, CEO and director founded JetBlue in 1999 and has been flying since 2000 after his previous airline, Morris Air, was taken over by Herb Kelleher, the founder of Southwest Airline. He signed a 5-year non-compete agreement not to launch another airline. Kelleher hired Neeleman at Southwest but was unhappy with the structured environment he did not control and was fired (Essentials of Entrepreneurship p78). JetBlue's strategy is developed around its core competencies. The company benefited from the opportunity to start from scratch. It has the advantage of being the last mover, and its infrastructure and use of information technology have given JetBlue a sustainable competitive advantage. Starting from scratch gave Neeleman and president, COO David Barger, the advantage of handpicking a management and support staff that reflected their vision. the management boasts many years of experience in the airline sector. The team members have dealt with clients, been customers and have extensive experience in what it takes to succeed in the industry. In the initial planning process, 20 members of JetBlue's executive staff met for two days and agreed on five core values: Safety, Caring, Integrity, Fun and Passion. These five values ​​translate into a superior experience for customers and crew members (Motley Fool). JetBlue is different from other discount airlines. While Southwest and JetBlue use the same type of jet (Boeing 737 for Southwest and Airbus A320 for JetBlue), Jet Blue planes seat 162 passengers versus Southwest seats 135. Using this plane helps keep maintenance costs low. This low maintenance cost is lower than any other carrier in the industry. JetBlue also focuses on longer flights (Essentials). Neeleman decided to upholster each seat in leather, which costs an extra $15,000 per plane. Leather surfaces are easier to maintain and last much longer (Essentials). Another advantage is that the workforce is not unionized. Neeleman is not against unionization but would prefer to avoid it. He believes that if management and employees trust each other and if people feel they are being compensated fairly, he believes there is no need for a third party.