Fuel Implications
January 29, 2009 – 5:13 pmJetBlue is out with news that it will finally begin service to/from LAX . This is not surprising given the drop in fuel prices. It is a different game than the one they bailed on last year. Back then the route was going to cost them about $300 per seat or 70% of the average fare they could collect (based on LGB fare prices). (More on the economics here .) Now the price is likely 1/4-1/2 of that. So, it is a far better cost environment. Of course, now they need to worry about the revenue side of the puzzle. But, it is not surprising that the market data shows they’ll be able to fill a couple flights a day. Look out for more airlines to re-launch transcon expansion plans if fuel stays down. If only Skybus was still around.
