JetBlue’s Strategy Formulation

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Table of Contents

Founding and Current Strategy
Competitor assessment
Future strategy
Works Cited

Founding and Current Strategy

Jet Blue was founded by David Neelman. Its foundation was laid based on the following motto ” bring humanity back to air travel”. He wanted to develop an airline that could provide a home-like ambiance to its customers at low fares. Leather seats, 24-hour live transmission on TVs, gourmet snacks, and a cozy den-like environment was provided to the customers. Neelman pioneered the induction of electronic reservation ticketing in the airline industry.

JetBlue’s first major venture was the John F Kennedy airport to take care of flights between New York and Buffalo. The rates offered were 70% less than competitor rates. This attracted the middle-tier income groups of the region. Soon Jet Blue expanded its domestic flight coverage beyond New York to Manhattan and other areas.

The expansion was very rapid and was central to JetBlue’s core strategy. From 2000 to 2007, JetBlue increased its domestic flight coverage from 12 to 53. The number of aircraft owned did not rise proportionally. Between 2005 to 2007, the company could add only 40 aircraft while the number of departures grew exponentially from 10000 to 196,594.

JFK airport became overcrowded and disturbances created due to weather could not be effectively handled. The worst blow came on 14^th February 2007. The inaction and turbulence caused because of JetBlue’s inefficient operational service, the entire image of the company went down the drain. Its delay rate was 114% and it was ranked as the third most delayed airline in America. The company was incurring heavy losses. the company was not involved in too many diverse activities but the growth was very fast. (RovenPar J, 2008)

Competitor assessment

The operating costs of JetBlue were lower compared to competitors like Boeing. It offered low fares, served only snacks and other benefits at cheaper rates. The air crafts were new so the maintenance costs were relatively lost too. American Airlines and South West Airlines were incurring higher maintenance costs on the other hand. They were fined due to operational glitches in the aircraft. (Donnelly S, 2001)

JetBlue suffered due to technical glitches in its aircraft handling. When the oil prices rose and the government introduced new policies most of the other airlines went bankrupt while big wigs like US Airways opted for mergers with other companies. The focus of all airlines became energy conservation and they started coming up with various tactics to do the same. (Weil. N, 2007)

New airlines like Virgin America and Newair & Tours also came up. These airlines posed a direct threat to Jet Blue because their prime focus was also providing experience at low-fares. Their strategies were more realistically planned compared to JetBlue’s strategy. They aimed at increasing the number of flights by the increase in the number of aircraft. JetBlue failed to forecast this lag correctly.

Future strategy

Jet Blue needs to focus on various strategies to survive in the long run. It should find ways to cut down on costs, reevaluate how the company is using its assets, raise its airfares and grow in only certain target markets, offer strategic partnerships, and improve the quality of its services. It should not indulge in too many acquisitions. For now, it needs to sustain its current growth to ensure a higher rate of return in the long run. Some of the aforementioned strategies have already been implemented while some others need to be addressed immediately.

Works Cited

Donnelly.S, Blue Skies. Prorequest database. 2001.

Weil.N, What Jet Blue’s CIO learned about Customer Satisfaction. ABI Proform. 2007.

RovenPar. J, Jet Blue Airways. Manhattan College. 2008.

Click Here To Order Now!

JetBlue’s Strategy Formulation

Do you need this or any other assignment done for you from scratch?

We have qualified writers to help you.

We assure you a quality paper that is 100% free from plagiarism and AI.

You can choose either format of your choice ( Apa, Mla, Havard, Chicago, or any other)