Is JetBlue positioning itself for the next big airline merger/acquistion? One airline analyst says yes, though I remain skeptical.
That analyst is Dan Reed, a Forbes contributor who has written about airlines the last 26 years. He makes the following argument:
Geraghty appears that she’s building a not-so-subtle case – one that she hopes at least some analysts and/or investors will buy into – that the idea that acquiring JetBlue would be good way for one of the Big Three carriers to protect its future profits.
Joanna Geraghty is JetBlue’s President and Chief Operating Office. Reed believes, based upon repeated comments from Geraghty, that JetBlue is making the case to one of the big three legacy airlines–American, Delta, and United–that they need to buy JetBlue to avoid even deeper lost profit.
Reed argues that JetBlue’s A321neos are not ideal for transatlantic transport and that JetBlue lacks “a large enough domestic route network to move sufficient numbers of U.S. passengers to Europe via JFK or to attract large numbers of Europeans bound for U.S. destinations beyond New York.”
I disagree on both points. JetBlue’s route network is indeed limited, but both Boston and New York are sufficiently well-connected to offer service to London. Furthermore, I think the concept of wide body aircraft being inherently superior is simply not the case. Jet Blue’s service and amenities more than make up for the lack of a second aisle.
In terms of mergers, the only viable JetBlue wedding I see would be with Alaska. Even that is far-fetched, but would create a unified airline with a strong east coast and west coast presence. That would be a merger of growth, not a merger to fend off competition. Even in the era of Trump I don’t think regulators would sign off on a JetBlue acquisition from American, Delta, or United.
JetBlue still has great potential to bring fare discipline to the transatlantic market. My prediction, at least for now, is that it will continue to got at it alone.
> Read More:
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