While industrywide corporate air demand was flat in the
first quarter, JetBlue Airways increased its share of corporate business,
executives said during the carrier's first-quarter earnings call.
New routes, such as service to Cleveland, get some of the
credit for the growth in corporate business, executive vice president of
commercial and planning Marty St. George said. The carrier also is benefiting
from a tightening of corporate travel budgets, he said.
"As corporate travel accounts get stressed and
corporate travelers are looking to get more value out of the buck, that's a
perfect opportunity to take a look at JetBlue, and we're seeing it in our
numbers," St. George said.
JetBlue's total operating revenue increased 6.1 percent year
over year during the first quarter to $1.6 billion, including a 4.9 percent
increase in passenger revenue. In addition to new routes, the business travel
market in Boston also performed strongly during the quarter, president and CEO
Robin Hayes said.
The carrier also has seen strong performance on routes with
its premium Mint service, which JetBlue during the next few years will expand
significantly. While JetBlue's average fare decreased 6.8 percent to $162.06
during the quarter, St. George noted that demand on Mint routes between New
York and both Los Angeles and San Francisco have allowed the carrier to push
those fares up between $25 and $75 earlier this month.
Both traffic and capacity increased 14.1 percent year over
year during the quarter, keeping JetBlue's load factor essentially flat at 84.2
percent. Passenger revenue per available seat mile decreased 8 percent, but
operating expense per available seat mile was down 12.6 percent, owing largely
to fuel prices. The carrier reported a net income of $199 million for the
quarter, up from $137 million a year prior.
Despite losing out to Alaska Airlines in an attempt to acquire
Virgin America, Hayes said JetBlue still intends to grow its presence on the
West Coast.
"As we explored the possibility, the price reached the
level where it became clear our strategic plan for organic growth offered a
better path to value creation," he said. "Growing our West Coast
presence remains part of our long-term growth plan. Acquiring Virgin America
would have simply accelerated that plan."