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JetBlue founder to launch new US domestic airline

The Independent logo The Independent 12/02/2020 Simon Calder
a blue and white plane sitting on top of a runway © Provided by The Independent

Airline bosses who have given me lifts would actually be a shorter book than Lifts I have had on (or in) agricultural vehicles.

The synopsis comprises only Michael O’Leary, chief executive of Ryanair; Tim Jeans, when he was managing director of Monarch; and David Neeleman, founder of jetBlue.

The first two were in very comfortable Mercedes; the last, in a battered pick-up truck.

David Neeleman is unlike other airline bosses in many ways: he is a practising Mormon; he has 10 children; and he keeps starting successful companies.

I met him in the Connecticut town of Darien – where, appropriately, he was exploiting a gap in the market.

This was where he created jetBlue, demonstrating the latent demand for a low-cost, high-quality carrier based in New York with a strong presence in Boston. Before that Mr Neeleman had co-founded, aged 25, a charter airline called Morris Air based in Salt Lake City; and helped launch WestJet, Canada’s highly successful budget airline.

Since he dropped me with a smile at Darien railway station, he has created Azul, a leading Brazilian airline; rescued TAP Portugal; and, this week, announced that his latest new US domestic airline is to be called Breeze.

You might imagine that the last thing America needs is another carrier. The giants – American, Delta and United – are already engaged in a ferocious air war against formidable lower-cost airlines such as Southwest, jetBlue and Alaska Airlines.

Add a couple of Ryanair-like ultra-low-cost carriers, Frontier and Spirit, and it is difficult to see any Darien-like gaps in the dense jungle of competition.

But David Neeleman believes he has found some. This week he told the Salt Lake City newspaper, Deseret News: “Right now, we see some pretty gaping holes in the industry.”

He is trawling through hundreds of city-pairs that do not yet have any direct flights. At present, travellers between (say) Albuquerque in New Mexico and St Louis, Missouri, have to change planes at Chicago, Dallas, Denver or Houston – even though the two cities have a million inhabitants between them and are less than 1,000 miles apart.

There are many other under-connected airports in America, such as Jacksonville in northeast Florida – which lacks direct links to key cities including Boston and New Orleans.

Mr Neeleman is betting that passengers in “cities that aviation forgot” will happily pay a premium for nonstop flights, bypassing the giant hubs with all the extra time and stress they involve.

So he has ordered 60 brand-new Airbus 220s aircraft for delivery starting next year. They are well-pitched in capacity just below the Airbus A319 and Boeing 737-700, with sound economics.

In the meantime Breeze is leasing 30 Embraer 195 planes from (conveniently) Azul, which will enable David Neeleman to test the concept.

This is an industry where most start-ups fail, and many investors lose millions. Frequent flyers’ addiction to the mileage schemes run by the network carriers can be difficult to overcome.

There are plenty more hazards ahead – notably bigger rivals matching routes and undercutting prices, either as “spoilers” or waiting while Breeze builds up a market and then moving in.

But Mr Neeleman says he has an edge: friendliness.

“Twenty years ago, we brought humanity back to the airline industry with jetBlue,” he says. “Today, we’re excited to introduce plans for ‘the world’s nicest airline’.”

He is already in a three-way tie for the “world’s nicest airline boss”.

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