Oh, Joy!  Interesting news to drive war, pandemic, oil shocks, and other externalities from the front page of commercial aviation news.  The JetBlue decision to make an offer for Spirit caught most of us by surprise.  A first reaction to the news is followed by a simple question: Why?  As in, how does this make sense?  JetBlue and Spirit have different business models.  Airlines chase economies of scale to drive down costs – so scale is attractive.  And it’s true that Spirit’s fleet fits in well with JetBlue’s – essentially P&W-powered A320s.  But still. Comparing Frontier, JetBlue, and Spirit.

Cowen & Co.’s Helane Becker notes the merger of JetBlue and Spirit would create the fifth-largest US airline. She goes on to note the transaction faces an “uphill regulatory review“. “The new entity will fly under the JetBlue name and will have an increased presence in focus cities such as FLL, LAX, LAS, and MCO. JetBlue’s network will also expand into the Midwest, a relatively new geography for them, giving them increased corporate and consumer relevance. JetBlue expects $600 MM – $700 MM in annual net operating synergies to be created from the deal, primarily driven by revenue improvement, and for 33% of the synergies to be achieved in year 1” she writes in a note.

To get some “feel” for what the field looks like, we modeled Frontier, JetBlue, and Spirit data and offer this as a potentially useful tool to better understand the metrics and scale involved.  As always, please click the double-headed arrow at the bottom right to optimize your viewing of the model.  The data is through September 2021.

There are six pages:

  • Page 1 compares stage length and op costs.  Click the play button at the bottom left to see the history play out.  You can also click on the airline balloon to see how it tracks over time.  Balloon size is the number of flights. The two dashed lines are axis averages.
  • Page 2 is a similar chart, but stage length compared to load factor.
  • Page 3 compares load factor by seating for aircraft types and you can select an airline from the box on the right.
  • Page 4 allows you to compare ASMs by airline and aircraft type.
  • Page 5 shows market size and growth from 2000 on through 3Y21. Of the three JetBlue was the largest in 2000 but it grew less rapidly.
  • Page 6 provides a snapshot of 2021 in terms of costs and flights.  Click on an airline name on the table to see its relative flight activity on the pie.

What’s your reaction to this new offer?

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Addison Schonland
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Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.

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