The Skift Airline Innovation Report is our weekly newsletter on the business of airline innovation. We look closely at the technological, financial, and design trends at airlines and airports.
Brian Sumers writes and curates the newsletter, and we send it on Wednesdays. You can find previous issues of the newsletter here.
JetBlue Airways has a transcontinental premium product customers like, and one it has proven it can deliver at a low cost, and with reasonable fares. So it’s obvious the airline should expand to transatlantic routes, where roundtrip business class fares can top $8,000, right?
Not exactly. As I wrote on Monday, JetBlue’s decision about whether to fly from Boston and New York to Europe is more complicated than it may appear. While its core customers are cheering it on, JetBlue faces several potential issues, including increased competition, aircraft range, and airport access. JetBlue is now weighing whether the advantages outweigh the drawbacks.
The good news is the analysis is almost over. JetBlue has promised its employees it will have more to share this year. That timing makes sense, because JetBlue must inform Airbus whether it wants to convert an existing order into the new A321LR, or long-range, aircraft.
My guess is that JetBlue will go for it. My rationale is simple. The airline’s top executives have been talking for two years about Europe to media and analysts. Had they been unsure, wouldn’t they have deliberated in private?
But who knows. JetBlue could also stick with flying in the Americas, where competition is more forgiving and where it does not need a new long-range airplane.
What do you think? Is JetBlue expanding to Europe?
Best of Skift
Pros and Cons of JetBlue’s Possible European Expansion: Many consumers want JetBlue to expand to Europe, so it can disrupt established players on pricing and product. But this is easier said than done. Big airlines make major margins on transatlantic flights, and they won’t want to cede ground to JetBlue. In this story, I list some reasons for, and some reasons against, JetBlue’s possible plan to fly to Europe.
Sun Country: Inside America’s Most Unusual Airline: I traveled to frigid Minneapolis last month to report a story on America’s smallest mainline carrier. Sun Country has always occupied a niche in Minneapolis, but now under new owners — a private equity shop — it is expanding nationwide. It should stay small, though. It now has about 30 aircraft, with plans to grow by about six per year for the foreseeable future.
Southwest Co-Founder Herb Kelleher Dies, Leaving a Legacy That Changed Airlines Forever: Southwest’s iconic founder and former CEO died last week at 87. Publications have praised him for transforming aviation, and they’re right. Before Kelleher and his partner built Southwest, no one had built a low-cost airline on such a grand scale. His model spurred other entrepreneurs to copy, and many of them have succeed. Do you think Ryanair would exist if not for Southwest? What about Air Asia?
Struggling Norwegian Thinks It Is in Better Shape for 2019: Will Norwegian Air go out of business? We have no idea, though as we said last week, we suspect the airline will survive 2019. Skift Europe Editor Patrick Whyte took another look at Norwegian’s situation this week, writing, “Norwegian seems to be taking fewer chances this year and improved its hedging position, giving it more certainty over costs in the coming months.”
American Airlines and Expedia Quietly Settle Trademark Lawsuit: Expedia created a discount hotel program called Add-On Advantage. See the problem? American’s frequent flyer program is called AAdvantage, and the airline ruthlessly guards its trademark, as it must. American filed a federal lawsuit in Texas in October, which the parties have settled. Skift’s Dennis Schaal has details.
Japan Rolls Out New Departure Tax Opposed by Airlines: Japan has a new departure tax equal to about USD$9. “We are disappointed that the Japanese government decided to proceed with the tourism tax, which took effect this month,” an IATA spokesman said. Understandably, airlines opposed the tax, but I’m not sure it will affect demand. Our Asia Editor Raini Hamdi has a full report.
Travel Resolutions for 2019: Top Picks From Skift Staff: The entire Skift team — not just those of us who write for a living — put together a list of New Year’s resolutions for travel. You may enjoy them.
Best of the Rest
Frontier Flight Attendants Stop Pooling Gratuities: The interesting part here is not the pooling, but the fact that tips exist at all. Most airlines have policies that bar flight attendants from accepting them. But Frontier has gone a different way, asking customers to tip flight attendants when they buy a snack or a drink, as Bloomberg’s Justin Bachman writes. Will other U.S. airlines copy this?
Low-Cost Long-Haul Airlines Haven’t Solved Their Late Arrivals Problem: Long-haul, low-cost airlines have many issues, but I never thought punctuality was one of them. Turns out, I was wrong. Flight-scheduling specialist OAG tells Bloomberg some of the least on-time airlines have a long-haul, low-cost model, including Norwegian Air and Air Asia X. I’m betting most of their customers don’t mind, as long as the fare is cheap. What about you?
Are You Up for the Longest Flight in the World? You’ve seen many of these longest-flight-in-the-world stories over the years, but Kris Van Cleave of CBS News, who went on the first Airbus A350LR flight from New York to Singapore late last year, has a nice touch. He explains what it’s like to spend 16 to 19 hours on an airplane, depending on the winds.
Airline Automation Triggers Intensified Debate Over Safety: Are airliner cockpits too automated? Many pilots say no, but it is increasingly becoming an issue, Andy Pasztor and Robert Wall — two of the finest reporters in the business — write in The Wall Street Journal. “We have very automated machines,” one European safety official told them. “But if something goes wrong, how do you allow the pilot to take over?”
Join Us On The Next Skift Call?
You’re hearing a lot of doomsday forecasts for 2019. Global recession. Stock market rout. Runaway inflation.
But my brilliant colleagues on Skift’s research team have analyzed 2019 trends, and they see things differently, at least for travel.
“We expect solid economic growth in 2019 should bode well for travel,” they wrote in a recent report. “We forecast international arrivals to reach a new all-time high and for travel and tourism to continue to contribute positively to the global GDP.”
Maybe you believe them. Maybe you don’t. But Skift researchers Rebecca Stone and Seth Borko, along with Executive Editor Dennis Schaal, will play host to a free conference call with readers at 1 p.m. EST on Wednesday, Jan. 16 to discuss their findings. They’ll share slides and set aside time for audience Q&A.
You should join them. You can sign up on Skift’s website.
Skift Senior Aviation Business Editor Brian Sumers [email@example.com] curates the Skift Airline Innovation Report. Skift emails the newsletter every Wednesday. Have a story idea? Or a juicy news tip? Want to share a memo? Send him an email or tweet him.