JetBlue founder's new airline is a 'tech company that happens to fly airplanes'
The founder of JetBlue (JBLU) just got another airline off the ground. It’s called Breeze and it touts itself as a “low fare, high flex” airline that is “seriously nice.”
The Salt Lake City, Utah-based airline, launched in May, debuted 39 nonstop routes between 16 cities in the South, Midwest, East Coast and Texas, focusing on markets that have lost nonstop service as major carriers have cut back on routes.
“I always called JetBlue a customer service company that just happens to fly airplanes,” David Neeleman told Yahoo Finance Live, “and with the changes in technology, we call Breeze a technology company that just happens to fly airplanes. It means that we're going to try and use technology all we can in our apps and in all of our processes to lower our cost and so that we can pass those savings along to our customers.”
Breeze will rely less on call centers and ticket counters and have most of its customer-facing tasks handled through an app.
One-way fares range from $39 to $99, and Neeleman says those aren’t just introductory prices. The goal is to get passengers to their destination twice as fast for half the price, he told Yahoo Finance.
“What's key is that in our markets where we're flying, we need to make the market 10 times bigger. There may be only five or 10 people a day traveling maybe between Huntsville and New Orleans or between Charleston and New Orleans. We need low fares to stimulate that traffic, so we're always going to have low fares,” he said.
The “flex” aspect of the airline means it can drop or add flights to a city depending on demand. The “seriously nice” part refers to its generous cancellation policy. Breeze allows non-refundable tickets to be cancelled and refunded without penalty for 24 hours after the purchase is made for ticket purchases made one week or more before travel.
The carrier currently flies 13 Embraer SA E190 planes, but will take delivery of half a dozen Airbus SE A220-300 jets in October.
“Those planes are unique,” Neeleman said, “because they have a really long range. We're going to have some first-class seats in them, and we're going to be able to go up to seven, eight hours of flight time eventually. There's just a lot of different markets that we can serve, long, thin markets that have never had non-stop service before on a long-haul basis.”
While airlines are seeing an uptick in passengers as the economic recovery continues, volume is still lower than it was pre-pandemic. The TSA reported 2.12 million travelers were screened at airport checkpoints on July 26 – a huge improvement over the 700,000 screened this time last year, though still lower than 2.6 million in 2019.
Breeze is Neeleman’s fifth airline startup, after JetBlue, Brazil’s Azul Airlines, Canada’s WestJet and Utah-based Morris Air, which was later purchased by Southwest Airlines (LUV).
“Airlines have always been a high capital-intensive market and so that's why most of them are public,” he said. “But, you know, we've got plenty of capital. And we can go for a long, long time. We expect to be profitable next year. So [going public] it's not something that we have to do, but I'd assume that that could be a possibility someday.”
Alexis Christoforous is an anchor at Yahoo Finance. Follow her on Twitter @AlexisTVNews.
