Jet Blue

Strategy Final: Is JetBlues strategy conducive to sustaining profitability?
team up: Grant Carter William DiSciullo Andrea Kalmans

Professor McAfee April 9, 2002

1

Introduction In the April 1st, 2002 edition of Barrons, a tag line in the Marketweek column reads, Airlines and other money-losing companies. 1 This tag line reflects the intense rivalry and the massive pecuniary losses undergone in the airline persistence in the erstwhile(prenominal) few months due to the economic recession and the 9/11 terrorists attacks. Amidst this airline industry malaise, however, JetBlue Airlines (JetBlue) launched service in February 2000 and generated over $41 million in profits in 2001.2 In this report, we look the question, Is JetBlues strategy conducive to sustaining profitability? The answer is a resounding Yes. At the one thousand foot level, we deal that even in the unattractive airline industry in which companies try to differentiate on qualities other than price -- still in the end often compete on price -- JetBlue has a unique formula for success. It competes head-to-head with the majors, particularly southwest Airlines (Southwest), on price, cost structure, features, and customer satisfaction.



However, the company has cut a niche in which a live and allow live strategy should prevail. Indeed, a rival attempting to bankrupt JetBlue whitethorn well cause more harm to itself than to its target. Airline perseverance Overview Background At one time the airline industry resembled the utility industry to the extent that regulators determined what firms could and could not do. In the 1970s, a time of runaway inflation, and rising unemployment, many concord that something had to change. In 1978 Congress passed the Airline Deregulation Act, which facilitated the entry of natural firms and freed them to charge whatever fares they wanted and fly whatever routes they analogousd. 3 Many new entrants materialized, including new low fare airlines like Southwest, and cutthroat competition has...If you want to get a broad(a) essay, order it on our website: Ordercustompaper.com



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