Jetblue Airways: Can It Survive in a Turbulent Industry Essay

1117 Words Nov 14th, 2008 5 Pages
1. JetBlue’s Mission
David Neeleman found JetBlue in 1999 with the mission “to bring humanity back to air travel". This goal is achieved by creating a company that offers comfortable, friendly travel at low fares and by this to differentiate themselves from the mass.
JetBlue has always identified itself as a customer service company first, focused on providing customers a unique experience on every flight and with every interaction with JetBlue. (Annual report, 2005)

2. Brief STEP (social, technological, economic political) analysis
S. There are several social and cultural factors influencing the airline industry: the globalization, mergers between airlines, weather, September 11, 2001, wars with other nations.
September 11
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From the other prospective, the technology gives buyers ability to compare prices and with no switching costs they can chose the lowest fair. This is where JetBlue has advantage with its low-cost strategy.
Bargaining power of suppliers: The bargaining power of suppliers is high because there are only two major suppliers- Boeing and Airbus. This makes it difficult for the companies to obtain lower prices. There is no threat of forward integration. The higher degree of suppliers’ power reduces the ability to earn high profits, thus reducing the number of smaller airlines such as JetBlue.
Threat of new entrants: There are high barriers for new entrants on this market, because of difficulties with obtaining the hubs, creating strong brand identity and obtaining a starting capital. Despite that there is a threat of new companies to enter as JetBlue competitors, because the factors that differentiate the company are easy to copy or imitate.
Treat of substitute products: For shorter distances there are several substitutes to air travel (car, train, bus) but with long distance travel, plains are the only reasonable way of travel.
4. Brief SWOT (strengths, weaknesses, opportunities, threats) analysis.

Low cost
Unique company-employees relationship
High employee efficiency
Superior customer service
Safety

Not enough influence in the airline industry
Doesn’t have access to some major

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