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Expanding network, margins in JetBlue’s six focus cities

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Updated

Launch of new routes

JetBlue Airways Corporation (JBLU) reported margin expansions in all of its six focus cities during the trailing twelve months ending September 30, 2014. The six focus cities include New York, Boston, Orlando, Fort Lauderdale, Los Angeles, and San Juan.

JetBlue’s operations are concentrated in the domestic region just like most of its peers in the US including Delta Air Lines, Inc.(DAL), American Airlines Group Inc., (AAL), United Continental Holdings Inc. (UAL), Southwest Airlines Co. (LUV), and Alaska Air Group, Inc. (ALK).

Part10_3Q14_Margin expansion in six focus cities

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Benefits for investors

The growth in demand for air travel, combined with reduced fuel costs, has resulted in share price appreciation of airline stocks and transportation exchange-traded funds, or ETFs, that hold airline stocks. Two such funds are the SPDR S&P Transportation ETF (XTN) and the iShares Transportation Average ETF (IYT).

The expansion specifics

JetBlue has launched many new routes and frequencies to expand its network coverage. More recently, its focus is on expanding at the Fort Lauderdale-Hollywood International Airport, or FLL.

  • JetBlue currently offers around 75 daily flights to 33 destinations from FLL. In October, the company launched four new routes to Cartagena, Las Vegas, Pittsburgh, and Jacksonville.
  • JetBlue launched a new nonstop daily service from Salt Lake International Airport to Orlando International Airport in November. This will be JetBlue’s third nonstop service from Salt Lake City. The airline currently provides flights to New York’s John F. Kennedy International Airport (or JFK) and to Long Beach Airport near Los Angeles.
  • JetBlue also plans to add seven daily frequencies from New York’s JFK airport to Los Angeles by the end of the year. This will be JetBlue’s recently introduced premium service, Mint, which has had strong demand from new customers as well as from corporate travelers.
  • JetBlue launched twice-weekly flights from New York to Curacao. With this new destination, the airline now offers 121 daily flights from the US to the Caribbean. JetBlue offers more routes than any other airline from the US to the Caribbean.
  • A new route from Washington DC to Jacksonville will commence in December, and another route from San Francisco to Las Vegas will commence in January.
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