JetBlue Airways believes it is on the verge of announcing a new domestic airline partner as it moves beyond the now-shuttered northeast alliance (NEA) with American Airlines.
Though a federal ruling left the door open for a more limited version of NEA, American has “concluded” its conversations with JetBlue and filed suit against the LCC to recoup costs.
Despite attempts to renew a partnership, agreement could not be reached on “a construct that preserved the benefits” of what was envisioned, American said
. “Although we proposed a very attractive proposition to JetBlue … it became clear over time that JetBlue was focused on different business priorities,” wrote American Airlines Chief Strategy Officer Steve Johnson in a letter released April 29.
Since a court order terminated the NEA, American and JetBlue have been working to wind down remaining aspects. “This is not an unexpected turn,” JetBlue CEO Joanna Geraghty said in reaction to the suit, on a same-day earnings call. “It’s part of just truing up any monies owed between the parties,” she told investors.
Over the past several months as American pursued an appeal of the federal ruling solo, JetBlue has repeatedly voiced interest in a new airline partnership and described ongoing talks with multiple airlines. Its multi-year plan to return to sustained profitability, JetForward, accounts for some level of partnership in the future.
Declining to elaborate on any specifics, JetBlue’s CEO said the potential new airline partner “drives more [value] for JetBlue than other carriers that may have been in the consideration set.” As far as scale, prior guides fall short of the mark, said JetBlue President Marty St. George.
“We do have a number in JetForward for partnerships—it is a number that does not assume a partnership of this size,” he told investors on the first quarter (Q1) earnings call. Looking to offer more destinations and frequencies, an expanded ability to “earn and burn” loyalty points is also a key consideration of the partnership, he noted.
“That means, for example, today if you are a customer in the northeast and you love JetBlue for leisure but twice a year you have to go to Omaha or Boise, these are places that you can’t earn TrueBlue points on now, and when this partnership goes forward, you will be able to,” St. George said.
JetBlue expects to announce a new domestic airline partner in the second quarter (Q2).
Credit: THEHILL