SFGate: Gala welcome for JetBlue/CEO looks to SFO service to help pull low-fare airline out of tough times

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Friday, May 4, 2007 (SF Chronicle)
Gala welcome for JetBlue/CEO looks to SFO service to help pull low-fare air=
line out of tough times
David Armstrong, Chronicle Staff Writer


   Aguy in a New York Yankees cap slapped five -- a low-five, of necessity =
--
with a bloke on stilts who was advertising "more legroom in coach," while
over by the gate, a tall man with white hair chatted with amused
passengers just off their flight from New York, all to the sounds of a
soft-jazz trio trilling "I Left My Heart in San Francisco."
   The white-haired man was JetBlue Airways founder and CEO David Neeleman,
working the room to promote the start of JetBlue's four-times-daily
nonstop service between San Francisco International Airport and New York's
John F. Kennedy International Airport.
   Neeleman was also ballyhooing JetBlue generally, talking up expansion
plans, announcing the reconfiguration of Airbus A320s to offer 34 to 36
inches of legroom -- above the industry average of 32 inches for coach
class -- and characterizing JetBlue's new customer bill of rights as a
success.
   JetBlue, a stylish, 6-year-old carrier, also flies to Oakland
International Airport and Mineta San Jose International Airport, but high
fees kept it out of SFO before now, according to Neeleman.
   "We had to contain our costs," Neeleman said in an interview Thursday in
SFO's International Terminal, where JetBlue's service is housed, even
though all its SFO flights are domestic, not international.
   "We talked to SFO and we are paying the (lower) domestic rate. We've had=
 a
good business in Oakland, and we still have a good business there, but our
customers want to fly to all three Bay Area airports and some of them find
it convenient to use SFO. And with the (BART) transportation to SFO, we
thought it was a good fit. We're happy to be here."
   SFO has lowered its landing fees and other costs for other airlines
carriers in the past several years to boost business. It has especially
courted low-cost carriers such as JetBlue, AirTran, Spirit and discount
category leader Southwest Airlines, which plans to resume service at SFO
this fall after an absence of several years.
   Neeleman acknowledged that JetBlue will face stiff competition at SFO,
especially on the potentially lucrative San Francisco-New York route.
   "We'll compete with American, of course, and United, especially its
(premium service). Delta has added a flight and Virgin America is coming.
It's going to be a party. I don't think Southwest will fly to New York and
Boston from here, but their plans could affect our expansion plans."
   JetBlue said introductory fares begin at $164 one-way between SFO and JFK
through June 13. Afterward, fares on the route will rise, starting at
$189. By comparison, a one-way ticket booked two weeks in advance for May
17 would range from $179 on Delta Air Lines to $614 on US Airways, though
Expedia.com, a search on Thursday showed.
   From its founding in 2000, JetBlue was an immediate success, with its
leather seats, free DirecTV service at every seat, smartly dressed cabin
crew, and low prices for an all-economy class, modern Airbus aircraft. But
high fuel costs and rapid expansion drove the company into the red late
last year, and it's been a rough ride since then.
   JetBlue is still trying to get over its February meltdown, when the
airline stranded hundreds of passengers in planes parked on runways --
some without water, food service or working toilets -- for up to 12 hours.
Neeleman said at the time that the delays, which occurred during a major
East Coast ice storm, would cost the company $40 million.
   Last week, JetBlue of Forest Hills, N.Y., reported a first-quarter loss =
of
$22 million, down from a loss of $32 million in the first quarter of last
year.

   Senator Barbara Boxer, D-Calif., and other members of Congress have
introduced legislation to establish a passengers' bill of rights, but
JetBlue prepared a bill of rights of its own shortly after the ice storm.
Neeleman said the program shows the company has learned its lessons from
the February chaos.
   "If you have been inconvenienced, your name goes into a database for
compensation," Neeleman said, referring to vouchers for future travel and
other compensation for canceled flights or extended delays in situations
JetBlue acknowledges it could have controlled. "You can request that
through our Web site, www.jetblue.com/promise, and by telephone" at (800)
538-2583.
   In addition to the New York service, JetBlue on Thursday also initiated a
daily nonstop flight to Boston. On July 27, the airline plans to offer
daily, nonstop service between SFO and Salt Lake City, Neeleman's
hometown.

   E-mail David Armstrong at davidarmstrong@xxxxxxxxxxxxxxxx --------------=
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Copyright 2007 SF Chronicle

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