Jetblue Airways Growing Pains Case Study Analysis Psychology

Strengths

• JetBlue Airways is the low cost Airline of America.

• Strong people on top management, several JetBlue executives are former employees of Southwest Airlines.

• It follows the low cost strategy of Southwest Airlines but differentiate itself by facilitating customer with entertainment stuff.

•  Strong Brand widely known among the people of US.

• Live TV at every seat with 100 channels.

• Low cost operations

• JetBlue continually hiring talented and experience people and also retaining them.

• JetBlue was named the number one U.S. domestic airline by Coned Nast Traveler magazine’s “Readers’ Choice Awards” for the sixth year in a row.

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Weaknesses

• JetBlue has not yet tried to lift money by selling snacks during flights

• It was established in year 1999 relatively new airline company that the reason it still not have complete market hold on 50 states.

• In year 2005 it had faced Aircrafts problems which reduced the profits.

• Airline is operating in 12 countries.

Opportunities

• The airline industry growth is not up to the mark but still JetBlue profits are on higher side.

• Increase the number of flights.

• Penetrate in US market.

• Majority of international markets are untapped.

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Threats

• The incident of 9/11 increases the security threat for airline industry.

• Recession in US may lower the revenues.

• The price of fuel is unpredictable.

• JetBlue facing Strong competition in US and International market.

Related

JETBLUE AIRWAYS: GROWING PAINS I. Introduction A. Executive Summary 1. Summary statement of the problem: JetBlue Airways was a fairly new airline that was going up against such airlines like Southwest, AirTran, and Delta. Started in 1999, JetBlue Airway was able to turn profits fairly quickly; in 2001 the company had profits of $38.5 million (George & Regani, 2008, 20-4). From there on it seemed that the company would continue to be profitable especially with expansions in the works; moving into areas that competitors ignored, ordering more planes, expanding to the west coast, and building a new terminal at JFK. However, due to various external and internal factors the company once again posted losses in 2005 and 2006. 2. Summary statement of the recommended solution: The problem is that JetBlue is expanding too fast and too soon to keep up. The company needs to slow their growth so that the company can keep up with the pace. Furthermore, the company needs to continue to do what the company does best; superior customer service, low fares, short-to-medium routes instead of offering what the competitors are doing. This is lessening JetBlue’s differentiation from other companies creating just another option for customers. Finally, JetBlue needs to continue to make cuts as outlined in the Return to Profit plan so that the company reduces expenses. B. The Situation JetBlue Airways was a low-cost carrier that was founded in 1999 by David Neeleman. JetBlue was able to become competitive by offering passengers low fares and several value-added services such as leather seats, snacks instead of full meals, and free personal satellite television. JetBlue’s success was due to a variety of reasons. For one thing, JetBlue mainly used secondary airports targeting a market that other airlines missed. Furthermore, JetBlue used Airbus A-320 airplanes instead of Boeing 737s which ended up saving money because of maintenance and they were more fuel-efficient. Also, JetBlue created a family-like work culture that helped their workforce to have a positive attitude thus giving customers superior customer service.

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