JetBlue builds in California with equity stake in public charter provider JetSuite

US carrier JetBlue Airways is to expand its presence on the US West Coast, although not through its own network expansion, but via a closer relationship with private jet company JetSuite. The airline is to acquire a minority stake in the business which alongside its private flying has recently expanded into the public charter sector with a growing fleet of 30-seat Embraer ERJ135s.

The shareholding is seen as a low-risk way of JetBlue building its presence along the US West Coast and will provide a complementary offering and support its growing push to support business clientele, while keeping competitors on their toes.

"JetBlue and JetSuite share a passion for delivering a high-quality customer experience at a competitive price point in underserved markets," said Robin Hayes, president and chief executive officer, JetBlue. "Our investment in JetSuite makes sense as we continue to execute on our west coast plan and invest in innovative ideas that reflect the disruptive spirit of JetBlue."

There are actually indirect synergies between JetSuite and JetBlue. The private airline is run by Alex Wilcox, part of the original JetBlue executive team and the airline’s founder David Neeleman sits on the JetSuite board. Members of TrueBlue, JetBlue's customer loyalty programme, are already able to earn points on all JetSuiteX flights. But additionally, as part of JetBlue's plan to expand its customer base on the west coast and provide access to new geographies, the two companies now plan to explore opportunities for further cooperation

"We are delighted to have JetBlue join us as a strategic partner and shareholder. The partnership with JetBlue will allow us to accelerate our growth and we are excited to work together to deliver new and unique experiences for all JetSuite and JetBlue customers," said Alex Wilcox, chief executive officer, JetSuite.

Initially formed as a charter business in 2009, JetSuite has been working to provide travellers access to a private jet experience at an attractive cost with a fleet of four-seat Phenom 100s and six-seat Cessna Citation CJ3s. It expanded into the public charter sector in April this year with the launch of JetSuiteX and is introducing ten ERJ135s by mid next year to support network growth. These will also be used for private charter, where the whole jet may be chartered for around $8,000 per hour (around $265 per person per hour for a group of 30).

JetSuiteX is attempting to bring convenience and quality back to business flying, avoiding many of the larger airports served by the commercial airlines to provide an efficient and convenient offer to its customers. It launched on April 19, 2016 with a weekday service in the busy San Francisco Bay Area to Los Angeles market.

However, rather than serving busy, and more congested airports such as Los Angeles International, Oakland, Sacramento, or San Francisco International it is using private jet facilities at Burbank Bob Hope Airport and Contra Costa County’s Buchanan Field in Concord to link the cities, avoiding crowded terminals, long security lines and inconvenient parking restrictions.

DID YOU KNOW? Buchanan Field last had direct service to Los Angeles when Pacific Southwest Airlines served the route five times daily between 1986 and 1992.

“For travellers on the busy San Francisco – Los Angeles corridor, JetSuiteX now offers a real choice – a private jet style experience for the price of an airline seat. Many of our private jet customers have been asking us to provide the JetSuite experience in an aircraft with more seats and longer range, and we've listened,” said Wilcox.

The company has subsequently added flights from Burbank to Las Vegas McCarran International and San Jose Mineta International Airport; from Carlsbad’s McClellan–Palomar Airport to San Jose; a weekly flight between Buchanan Field and Las Vegas, departing on Friday evening and returning on Sunday afternoon; as well as service between San Jose and Las Vegas. It also serves Bozeman, Montana and Mammoth, California and is understood to be exploring additional routes to other major western markets, including San Diego, Santa Barbara, and Phoenix.

“JetBlue needs to expand its West Coast US presence, especially with the Alaska-Virgin America merger looming, and this accomplishes that goal,” Michael Miller, chief executive officer for the Americas at CAPA told Routesonline. “This hits a second goal to be more relevant to business travellers. Overall, it's a smart move with not a lot of investment for a minority stake.”

JetBlue currently has a strong focus on the US East Coast and had shown its own interest in acquiring Virgin America ahead of its merger with Alaska Airlines to expand on the West Coast. Only two of its top ten markets by capacity this past summer were on the US West Coast – Long Beach Airport (ranked sixth with 2.9 percent share) and San Francisco International Airport (ranked tenth with 1.9 percent share).

However, data from intelligence provider OAG shows that US West Coast destinations dominate its biggest growing markets this winter, based on current published schedules. This includes an additional 189,000 seats out of Long Beach and around 40,000 more out of both Las Vegas and Los Angeles.