JetBlue will expand its premium Mint offering and could begin
service to Europe via an amended purchase agreement with Airbus, executives
said during the carrier's second-quarter earnings call.
Under the new agreement, JetBlue will take delivery of 30
new A321 aircraft over the next seven years.
These include 15 A321ceo aircraft beginning next year, five of those
outfitted for Mint delivered in 2017 and most incremental deliveries in the
following years to come in Mint, according to JetBlue. In 2020, JetBlue will
begin taking delivery of 15 A321neo aircraft with the ability to outfit them as
Mint or all-economy, and the carrier also has the option to configure them to
long-range aircraft.
That "could be the leap allowing us to leverage our
relevance in the East Coast focus cities and launch service in Europe,"
executive vice president of operations Marty St. George said, although the
carrier has not made an official commitment to doing so.
In the nearer term, JetBlue executives expect adding new
Mint service will strengthen its position on transcontinental routes.
Altogether, JetBlue plans to add 14 new Mint aircraft in
2017, bringing its total Mint fleet to 31. Most immediate, JetBlue will launch
daily Mint service between Los Angeles and Boston in October, president and CEO
Robin Hayes said.
The premium cabin has attracted corporate clients to
JetBlue, and unit revenue on Mint routes has grown 20 percent since Mint was
launched in 2014, the carrier reported. In the first half of this year, unit
revenue on Mint routes grew even as overall unit revenue declined, according to
Hayes.
"Mint has stimulated demand…and we anticipate Mint will
prosper in other long-distance city pairs," he said. "We believe it
will help us to become the carrier of choice in transcontinental markets, and
the timing is right to make this disruptive move."
During the second quarter, JetBlue's total operating revenue
increased 2 percent year over year to $1.6 billion. Passenger revenue declined
0.6 percent, but other revenues were up 35.2 percent, thanks in part to its new
fare structure implemented last year. Corporate revenue declined during the
quarter but at a lower rate than in the industry overall, indicating a growing
corporate business share, St. George said.
Traffic increased 10.3 percent during the quarter, and
capacity increased 11.1 percent, contributing to JetBlue's load factor dropping
0.6 percentage points to 85 percent. JetBlue's average fare declined 8.8
percent to $153.94, and yield declined 9.9 percent.
JetBlue reported a second-quarter net income of
$180 million, up from $152 million in the second quarter of 2015.