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February 27, 2024
Insight: JetBlue to Paris
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JetBlue announced Paris as their next European destination.  Service is slated to start on June 29th, in the summer travel season.   What are the prospects for JetBlue?

Using the US DoT T-100 data as a starting point we can see this is a great market to serve – steady growth and a fast recovery since the pandemic.  The 2022 data is through August.  Moreover, we see in the lower chart that traffic is pretty even – it picks up in May and drops again in November – five strong months.  

Next, breaking down this traffic by carrier flag, overseas airport, and market share we see the following.  CDG is by far the most important French airport. More than half the traffic is flown on French airlines and of these Air France holds the highest market share.   Regarding origin airports, JFK typically averages about 33% of the traffic.  JetBlue has therefore selected a strong O&D market. 

Had it selected Boston, for example, this market accounts for 6% of traffic from the US to France.  In this market, Air France holds ~60% market share.

The T-100 data is through August, and we project 2022 traffic volume at 511,000, which would be 89% of the 2019 level.  Not a complete recovery, but close.

For another view on this market, we turn to skailark, whose data is through December 2022.  The chart shows that the 2022 summer season was strong and considerably better than 2021.  Air France is the market leader by good measure.  Adding its alliance partner Delta, the combination has an unbeatable market share.

The critical challenge for JetBlue is that it will focus on this market as O&D.  Whereas the other airlines have many feed and distribution options.  JetBlue has some connectivity, but nothing like the other airlines in this market.   This means focusing on cabin amenities and passenger experience. 

However, it does have one crucial advantage.  That is the Airbus A321neo.  We have detailed how impressive this aircraft is over the North Atlantic.   The following charts examine the operating of the four competitors JetBlue will face off against. 

We start with average fuel prices.  Air France’s fuel price has risen over the period. The three US airlines paid more for their fuel than Air France.

Looking at the cost per block hour, we see the following.  Delta is the lowest-cost operator among these airlines for this route.

We get the following when reconfiguring the skailark data to show cost per block hour by aircraft type.  This is how JetBlue makes its new Paris route work.  The only comparable costs are if the other airlines deploy A321s as well.  There are 757-200s that could be deployed, but even they cost too much. 

This table shows where JetBlue has a distinct advantage.  JetBlue can afford to price its product to win over French travelers who may not be familiar with the brand.  Residents of the Tri-State area know the brand and likely use it to fly south every winter.  They know what they are getting and what to expect regarding a value proposition.  We suggest that travelers not tied to the frequent flier programs at the other big airlines would be open to a new product in this market.  If JetBlue wins enough critical mass, one daily flight will increase just like they do between New York and London. 

Sure, there is a risk, but JetBlue made London work and work well.  And that makes Paris a lower risk.

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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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