Jetblue Airways Corporation: Journey in the Heaven

JetBlue Airways Corporation: Journey in the Heaven

I. Introduction

Over time, air travel has become so commonplace that people cannot imagine the life without the airplanes. An American low cost airline, JetBlue Airways Corporation was incorporated in Delaware in August 1998, founded by David Neeleman (Brizek 2) and started operations on February 11th, 2000. At the beginning, Neeleman tried to learn from the Southwest model and improve the quality of services by providing the customers with a unique experience, which is now referred as “JetBlue Experience”. JetBlue focused on point-to-point service to large metropolitan areas with high average fares (Friesen 3) and now it serves 82 cities in 25 states, and 15 countries in the Caribbean and Latin America.

The success is closely related to its five core value: people, community, safety, security, governance, and economics. In 2002, JetBlue Airways acquired LiveTV, LLC, provider of airline's inflight satellite TV entertainment system and located television at every seat, which together with the equipped roomy leather seats are highly valued by customers. In 2003, after the third year of operation, JetBlue flies its 10 millionth customer. Two years later, JetBlue adopted the technology to offer online check in, with online baggage check in. In the same year, it received FAA's highly coveted Diamond Certificate of Excellence Award. In 2007, JetBlue was named Best U.S. airline by Condé Nast Traveler readers for the 6th year running and ranked highest in J.D. Power and Associates North America Airline Customer Satisfaction Study. In 2009, JetBlue's revamped TrueBlue Program touched down, which works on rewarding their customers. In 2012, JetBlue was ranked Highest in Customer Satisfaction Among Low Cost Carriers in North America and becomes one of the largest airlines in the Northeast of US.

II. Industry Analysis

The airline industry exists in an intensely competitive market. In recent years, the industry has been an industry modulation, which has far-reaching effects on the industry’s trend towards expanding both the domestic and international services. However, the American Airline industry as a whole has lost money for many years since 2001 (Air Transport Association).  Over the past several years, it has faced “recession, rising fuel prices, September 11, increased security requirements, the SARS threat, pricing transparency arising from the Internet, ticketless travel, and a host of new entrants” (Johnson 69). Many airline companies such as Delta, Northwest, US Air, and United are in bankruptcy.

III. Supply Chain

JetBlue’s supply chain begins by budgeting and planning. For each fiscal year, JetBlue does a budget for the whole company, which specifies how much will be spent on operating activities such as the fleet purchases, aircrafts maintenance, and advertising. After a detailed plan, JetBlue purchases inventories from suppliers, including fleets and other related goods and services. When it receives the goods purchased, it has to maintain the storage. In order to ensure functional operations, JetBlue has to do the maintenance such as trouble shooting, repairing, and upgrading. Then it designs airline routes for operation. Aiming to make profit, JetBlue designs routes mainly in the New York metropolitan area. Customers can easily search and buy the tickets online or purchase the vacation packages designed by JetBlue. At the time of departure, customers can easily check in online or at the airport. At the end of the supply chain is after-sale service. Customers will get rewarded for a round trip in U.S., and they can give feedback to all parts of the supply chain, which helps JetBlue to make further improvements.