Jetblue Case Study

JetBlue is a low-cost domestic airline in the United States following a rather interesting combination of 'low-cost and differentiation' as its strategy. It has been one of the fiercest competitors of the long-time ruler of the industry Southwest Airlines. From its inception in 1998, the airline grew to become the 11th largest player in the airline industry in a short span of 6 years. It had been the only other airline apart from Southwest airlines, to have been profitable during the aftermath of the September 11, 2001 attacks on World Trade Centre, and at a time when the entire airline industry was experiencing losses.

The core of JetBlue's strategy was low-cost achieved through a smaller and more productive workforce; automated processes; better use of technology; use of brand new single model planes that reduced maintenance costs and training costs at the same time. However, moving into the growth phase, JetBlue was contemplating the introduction of a new model of planes, "EMBRAER" that are smaller than the A320s that they were using. These planes were to be utilized for penetrating mid-size cities and also during off-peak times on existing routes. This had potential implications for its low-cost strategy. Also, the success of JetBlue invited the attention of its competitors. New discount carriers such as 'Song' were being launched that closely imitated JetBlue's differentiated product offering. This posed questions to the viability of both the bases of JetBlue's competitive advantage. Added to this, was the prospect that JetBlue would come head-to-head with other 'major airlines' and 'discount carriers' in its quest for expansion into different geographic markets. Based on the case study, a balance of both the internal and external elements of the environment surrounding the company has contributed to the success of the organisation. This paper is using PEST Analysis and SWOT analysis to weigh the capabilities of the firm. It is in this analyses that a set of recommendation is founded. Basically, the company is on the right track with regards to its operations. Though there are still minor imperfections on the organisation as a whole, a close regard on both the internal and external environments will be able to keep the JetBlue overcome the hurdles and obstacles in achieving their ultimate goals.

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