KSMF-KFJK via JBU

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http://www.sacbee.com/content/travel...-9308270c.html

Sac to N.Y. nonstop via JetBlue
By Clint Swett -- Bee Staff Writer - (Published March 1, 2004)

NEW YORK - Though it's nearly midnight, chuckles ripple through the
dimly lit cabin of JetBlue Flight 94 streaking east from Oakland to New
York.

The sound comes from passengers giggling as they watch Jay Leno's
"Tonight Show" monologue on the color TV screens embedded into every
seat back.

Others channel-surf ESPN highlights, gaze at the Weather Channel or
watch old episodes of "Leave It to Beaver" on Nick at Nite.

Unlike any other carrier in the United States, JetBlue provides its
passengers with 24 channels of satellite television programming on
every flight.

And despite some missteps and warnings that earnings could be headed
for a decline, JetBlue, following a recipe cooked up by Southwest
Airlines, is unlike most carriers in the loss-ravaged industry. The
upstart airline turns a handsome profit - nearly $104 million in 2003.

Beginning Wednesday, JetBlue will fly one nonstop a day between
Sacramento and New York's JFK airport - the first nonstop to New York
in the airport's 37-year history.

The fact that it's a red-eye, leaving at 11:55 p.m. and arriving in New
York at 7:55 a.m., seems to have done little to dampen advance
bookings.

"It's exceeding our expectations," said company spokesman Todd Burke.
"Sacramento is performing very strongly for us."

Sacramento was an attractive market because not only was it growing
quickly, but it didn't have nonstop service to the East Coast, JetBlue
executives said.

And adding the one overnight flight is a low-risk way to enter a market
because it keeps an airplane generating revenue when it would otherwise
be parked in New York, said Dave Barger, JetBlue's president and chief
operating officer.

Hardy Acree, executive director of the Sacramento County Airport
System, said Sacramento was hungry for nonstop service to the East
Coast, which typically cuts about two hours off a trip, and JetBlue is
an ideal fit.

"We fully expect the market to respond," said Acree, who courted
JetBlue for two years. "We hope they will add additional (flights)."

With a fleet of 57 new jets, television and leather seats for every
customer and some of the lowest costs in the business, New York-based
JetBlue joins Southwest as one of the industry's rare success stories.

The 4-year-old carrier has grown swiftly to the No. 11 airline in the
country and has added some of its own flavoring to the Southwest
formula.

Like Southwest, JetBlue emphasizes low fares (as little as $99 from
Sacramento to New York) and eager-to-please employees.

But there are significant differences, too. In addition to the free
on-board television, JetBlue has a wider variety of snacks, including
thick-cut blue potato chips, chocolate-chip biscotti and
chocolate-oatmeal cookies.

JetBlue says it doesn't overbook its flights, so passengers are never
bumped from oversold trips. And it has assigned seating - unlike the
open seating that sometimes contributes to a cattle-car feeling on
Southwest.

Daniel Petree, dean of the college of business at Embry-Riddle
Aeronautical University in Daytona Beach, Fla., said JetBlue's formula
has broad appeal. "They've chosen a segment of the market that's
price-sensitive but wants additional comforts of leather seats and a
new fleet," Petree said.

Bill Halldin, a Sacramento public relations executive, said the low
fares and ability to fly nonstop across-country were enough to get him
to drive to Oakland for at least eight business trips to New York on
JetBlue over the past 15 months. "When you combine the nonstop, the low
fares and the nicer amenities, it's an easy choice," he said.

Much of JetBlue's success can be traced to its founder and chief
executive officer, David Neeleman, who employs TLC as a way of snaring
and keeping customers.

"We wanted to make jet travel something you looked forward to, not a
means to an end," said Neeleman, sitting in a no-frills conference room
at JetBlue headquarters in Queens.

And it turns out, he said, that the carrier could do it without
spending lavishly.

The on-board TV, for instance, costs considerably less per passenger
than providing an in-flight meal.

"Why should we spend $5 on food and have something so unspectacular
that people make fun of it?" Neeleman asked. "For a fraction of the
cost we can put in something like live TV and make it memorable."

Though outfitting planes with gray leather seats cost more initially,
the payoff is in superior durability and easier cleaning than fabric
seats.

Buying a brand-new fleet of Airbus A320s has meant lower maintenance
costs than if the carrier had opted for cheaper, used airplanes.

JetBlue saves money in other ways, too. The company's reservations
agents work from computers in their homes in the Salt Lake City area,
eliminating the need to build an expensive call center.

And because the airline is relatively new, workers haven't been on the
job for so many years that they are receiving big paychecks based on
seniority.

All that has combined to give JetBlue some of the lowest operating
costs and highest profit margins in the industry, said Alan Sbarra,
vice president of Unisys R2A Transportation Management Consultants, an
airline consulting group.

For 2003, JetBlue's expense per available seat mile - what it costs to
move one seat a mile -was 6.08 cents. That compares with 10.25 cents
for American and 7.6 cents for Southwest.

That lets the company turn a profit despite offering some of the lower
fares in the industry.

While low fares bring the passengers in, amenities and friendly service
keep them coming back, JetBlue executives say.

And Neeleman does his part, to the point of taking flights at least
once a week to interact with passengers and crew members.

Once on board, he announces himself to passengers, thanks them for
their patronage, ties on an apron with "Snack Boy" emblazoned on the
front and passes out chips and cookies while listening to customer
comments.

"On one flight it took him two hours to get through the cabin," said
Julie Atkinson, a JetBlue flight attendant from Roseville.

Neeleman and other executives seem to devote the same attention to
employees, all of whom are nonunion.

Top officers including Neeleman and company president Barger attend the
first day of every new employee orientation. Neeleman opens the session
with a brief greeting and then an hour's worth of Airline Economics
101. "He goes through a lot of the detail, the math behind how we make
money, showing people how it links to their jobs," said Vincent
Stabile, JetBlue's vice president of human resources.

While not paying the highest wages in the industry, JetBlue is
competitive with other low-cost carriers such as Southwest and
Frontier. And the pay is augmented by generous profit-sharing - 19
percent of an employee's wages in 2003.

Neeleman came to the airline business in a roundabout way. After
finishing his two-year Mormon mission in Brazil, he moved to Salt Lake
City in the early 1980s where, at age 21, he founded a business selling
airline/condo packages for Hawaii vacations.

He joined travel agency owner June Morris to found Morris Air, a
successful low-cost airline that was snapped up by Southwest in 1993,
netting Neeleman $20 million.

Though he landed a top job at Southwest, Neeleman bolted the company
after just five months, frustrated by working in such a large
organization.

As part of his severance, Neeleman signed a five-year no-compete
agreement. Those five years were the gestation period for JetBlue.

He nailed down $130 million in investments, an extraordinary amount for
a startup carrier in such a cutthroat industry.

He also secured landing slots at JFK, an underutilized airport that
boasts a population of 20 million people within a 30-mile radius.

"He had good fares and was in the middle of the best market in the
U.S.," said Sbarra, the airline consultant. "So I don't want to say
their success has been a total shock."

But the journey hasn't been free of turbulence.

The company made a misstep last year when it began offering nonstop
service between Atlanta and Los Angeles. Delta responded by slashing
prices and increasing flights, and low-cost carrier AirTran also
entered the fray.

Unable to make money on the routes, JetBlue pulled out after seven
months.

The company faces other challenges, too.

As its fleet ages, maintenance costs inevitably will rise. And as its
work force stays longer on the job, its pay will climb.

A recent report from Prudential Equity Group warns that JetBlue's
profit margins will be down, at least in the short term.

The caution is reflected in JetBlue's stock price, which is hovering in
the $23 range, after trading as high as $47.14 in October.

Sbarra agreed that JetBlue will be hard-pressed to keep profits so high
as it expands into other markets. That would cut profit-sharing for
employees, perhaps making them more inclined to demand higher wages or
even seek to unionize.

"They went into the best markets first, the ones with less
competition," he said. "Now it will be harder to keep that growth rate
up."

While the company is rapidly buying more planes and planning to enter
smaller markets where low-fare competition is scarce, it will expand in
Sacramento cautiously, if at all.

Neeleman says he doesn't expect to offer anything but red-eye flights
from Sacramento for the foreseeable future, though he might consider
overnight nonstops to Boston or Washington, D.C., within a year or two.

Even if margins shrink, however, experts still expect JetBlue to be
more profitable than most of its competitors.

"Their model still works, and they're still high-growth," said Ray
Neidl, an analyst with Blaylock & Partners in New York. "That will
continue into the future."

JetBlue at a glance

Headquarters: Queens, N.Y.

No. of employees: 5,000

No. of planes: 57

Cities served: 23 (including Sacramento)

Chief executive officer: David Neeleman

Founded: February 2000

2003 revenue: $998 million

2003 profits: $103.89 million

BL.
- --
Brad Littlejohn | Email:
Unix Systems Administrator, |
Web + NewsMaster, BOFH.. Smeghead! | http://www.sbcglobal.net/~tyketto
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"A Guy Called Tyketto" wrote in message
m...
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http://www.sacbee.com/content/travel...-9308270c.html

Sac to N.Y. nonstop via JetBlue
By Clint Swett -- Bee Staff Writer - (Published March 1, 2004)

NEW YORK - Though it's nearly midnight, chuckles ripple through the
dimly lit cabin of JetBlue Flight 94 streaking east from Oakland to New
York.

The sound comes from passengers giggling as they watch Jay Leno's
"Tonight Show" monologue on the color TV screens embedded into every
seat back.

Others channel-surf ESPN highlights, gaze at the Weather Channel or
watch old episodes of "Leave It to Beaver" on Nick at Nite.

Unlike any other carrier in the United States, JetBlue provides its
passengers with 24 channels of satellite television programming on
every flight.

And despite some missteps and warnings that earnings could be headed
for a decline, JetBlue, following a recipe cooked up by Southwest
Airlines, is unlike most carriers in the loss-ravaged industry. The
upstart airline turns a handsome profit - nearly $104 million in 2003.

Beginning Wednesday, JetBlue will fly one nonstop a day between
Sacramento and New York's JFK airport - the first nonstop to New York
in the airport's 37-year history.

The fact that it's a red-eye, leaving at 11:55 p.m. and arriving in New
York at 7:55 a.m., seems to have done little to dampen advance
bookings.

"It's exceeding our expectations," said company spokesman Todd Burke.
"Sacramento is performing very strongly for us."

spin and other drivel snipped

Don't think this is going to last. How many passengers will forgo the
inconvenient red-eye and opt for one of the 7 non-stops from OAK instead?
Besides, the pax the SMF-JFK does get will most likely take away from B6's
OAK-JFK flights.

Stupid move, IMO.

Blake S wrote:
"A Guy Called Tyketto" wrote in message


Don't think this is going to last. How many passengers will forgo the
inconvenient red-eye and opt for one of the 7 non-stops from OAK instead?
Besides, the pax the SMF-JFK does get will most likely take away from B6's
OAK-JFK flights.

Stupid move, IMO.

The red-eye gets to JFK at 7:55AM giving you the whole day in NYC.
I have seen red-eyes fairly full from SJC to the east coast.

"mtravelkay" wrote in message
m...
Blake S wrote:
"A Guy Called Tyketto" wrote in message


Don't think this is going to last. How many passengers will forgo the
inconvenient red-eye and opt for one of the 7 non-stops from OAK
instead?
Besides, the pax the SMF-JFK does get will most likely take away from
B6's
OAK-JFK flights.

Stupid move, IMO.

The red-eye gets to JFK at 7:55AM giving you the whole day in NYC.
I have seen red-eyes fairly full from SJC to the east coast.


I have seen deeply discounted fares that include red-eye flights, especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on the
SMF-JFK flights?

Blake S wrote:
I have seen deeply discounted fares that include red-eye flights, especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on the
SMF-JFK flights?

I wonder about that. I've become a bit of a regular on the OAK-IAD redeye
and I can't think of the last time I didn't have three seats to stretch out
into for a good night's sleep. I love it dearly but I can't imagine it's a
huge profit machine.

SMF has a whole lot less passengers to draw from than OAK.

miguel
--
Hundreds of travel photos from around the world: http://travel.u.nu/

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Miguel Cruz wrote:
Blake S wrote:
I have seen deeply discounted fares that include red-eye flights, especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on the
SMF-JFK flights?

I wonder about that. I've become a bit of a regular on the OAK-IAD redeye
and I can't think of the last time I didn't have three seats to stretch out
into for a good night's sleep. I love it dearly but I can't imagine it's a
huge profit machine.

SMF has a whole lot less passengers to draw from than OAK.


There is also this. The only possible nonstop flights to New
York from SMF would be by COA, and that would only be to EWR.
Otherwise, it's AWE to LAS - JFK/EWR, or any other major flight with
one or more stops. There are none direct, unless you drive into the
bay, and that is a drive many people like to avoid. The traffic there
is horrendous, let alone fighting through just to get to SFO or OAK
alone to catch the flight. there are a lot of people who drive from RNO
- - SFO to catch nonstops to New York, and that's a 3 hour drive in
itself (1 hour from SMF - OAK). SMF is the best place and location
outside the bay for something like this, let alone in RNO, and the main
port of call for Northern California.

SMF is also the best outlet for the California Central Valley
(Stockton, Modesto, Lodi, etc). Whether it will work or not, we shall
see. I think it might. But I'm just the messenger. Hell, I'd just
want to work for JBU so I can work from home!

BL.

- --
Brad Littlejohn | Email:
Unix Systems Administrator, |
Web + NewsMaster, BOFH.. Smeghead! | http://www.sbcglobal.net/~tyketto
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"Blake S" wrote in message
link.net...

I have seen deeply discounted fares that include red-eye flights,
especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on the
SMF-JFK flights?

They don't need any.

The economics of redeye flights make them very profitable. There is a high
demand for overnight cargo space, and the aircraft would be parked
otherwise.

Ken Ishiguro

They said on news tonight that COA will be flying SMF to EWR for a few
months this summer.

As for flying out of Oakland, it's such a ****ty drive from Sacramento to
Oakland, I don't see why someone would choose to do that if they didn't need
to. I take a lot of flights out of SMF that connect through SFO and I'd
much rather take the 30 minute flight over to SFO to catch connector than to
spend 2-5 hours driving to SFO. Getting to Oakland isn't much easier during
most of the day.

Also, they said on news that the first JetBlue flight was 90% full and since
it's a redeye they're not taking as much of a chance on the route since the
plane would probably just be parked somewhere if not on this route.

Matt


"A Guy Called Tyketto" wrote in message
m...
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Miguel Cruz wrote:
Blake S wrote:
I have seen deeply discounted fares that include red-eye flights,
especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on
the
SMF-JFK flights?

I wonder about that. I've become a bit of a regular on the OAK-IAD
redeye
and I can't think of the last time I didn't have three seats to stretch
out
into for a good night's sleep. I love it dearly but I can't imagine it's
a
huge profit machine.

SMF has a whole lot less passengers to draw from than OAK.


There is also this. The only possible nonstop flights to New
York from SMF would be by COA, and that would only be to EWR.
Otherwise, it's AWE to LAS - JFK/EWR, or any other major flight with
one or more stops. There are none direct, unless you drive into the
bay, and that is a drive many people like to avoid. The traffic there
is horrendous, let alone fighting through just to get to SFO or OAK
alone to catch the flight. there are a lot of people who drive from RNO
- - SFO to catch nonstops to New York, and that's a 3 hour drive in
itself (1 hour from SMF - OAK). SMF is the best place and location
outside the bay for something like this, let alone in RNO, and the main
port of call for Northern California.

SMF is also the best outlet for the California Central Valley
(Stockton, Modesto, Lodi, etc). Whether it will work or not, we shall
see. I think it might. But I'm just the messenger. Hell, I'd just
want to work for JBU so I can work from home!

BL.

- --
Brad Littlejohn | Email:
Unix Systems Administrator, |
Web + NewsMaster, BOFH.. Smeghead! | http://www.sbcglobal.net/~tyketto
PGP: 1024D/E319F0BF 6980 AAD6 7329 E9E6 D569 F620 C819 199A E319 F0BF

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"Ken Ishiguro" wrote in message
news:YiA1c.27635$aZ3.11696@fed1read04...

"Blake S" wrote in message
link.net...

I have seen deeply discounted fares that include red-eye flights,
especially
on HP and AS. How many full-fare unrestricted pax does B6 expect on the
SMF-JFK flights?

They don't need any.

The economics of redeye flights make them very profitable. There is a
high
demand for overnight cargo space, and the aircraft would be parked
otherwise.

Ken Ishiguro


Using this logic, why wouldn't every airline have red-eye service to their
hub from anyplace. There must be some break-even passenger load.

I think most airlines do have redeye service to their hubs. I go to Hawaii
a lot and every airline has flights that leave around 10-11 PM in order to
arrive at the various hubs in time for the passengers to transfer to the
first flights out of the hubs.

Problem is the timing doesn't work in a lot of routes to have red-eye
service because no one wants to leave after midnight or arrive before 5:00
am, so it only works on certain routes.

Matt


"Blake S" wrote in message news:qAK1c.21293


Using this logic, why wouldn't every airline have red-eye service to their
hub from anyplace. There must be some break-even passenger load.