JetBlue Airlines 2007 Annual Report Download - page 4

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We launched service to five new destinations in 2007 including Chicago, San Francisco and Nantucket.
We also entered into a marketing partnership with Cape Air making it possible for customers to book
travel on a single itinerary between 21 JetBlue cities and four Cape and Island destinations in
Massachusetts.
Our primary network focus during 2007 was on ‘‘connecting the dots’’ and adding flights between our
existing destinations, which we believe helps improve our asset utilization and produces a better
return for JetBlue. During 2007, we also expanded our network out of Orlando – the home of JetBlue
University, our crewmember training center – and in Boston. JetBlue now serves more destinations
out of Boston than any other carrier.
As a part of a comprehensive network review, we also made the decision to cease operations in
Nashville and Columbus. These were very difficult decisions for us, primarily due to the impact they
have on our crewmembers in these cities and our commitment to the communities we serve. We
believe, however, that these decisions will ultimately lead to improved profitability, resulting in greater
value for our shareholders and our crewmembers.
The EMBRAER 190 aircraft, configured with 100 seats, allows us to develop thinner markets and also
allows us to more effectively manage capacity during our seasonal trough periods by replacing Airbus
A320s with the smaller EMBRAER 190s on certain flights. During 2007, our EMBRAER 190
reliability improved significantly. As a result of our improved EMBRAER 190 performance and its
market potential, we exercised three EMBRAER 190 options for delivery in 2009.
Together with our partners at The Port Authority of New York and New Jersey, we continued to
make progress on our Terminal 5 project at JFK Airport. We believe that this project, which includes
26 gates, new roadways, a parking structure, and a connector to the AirTrain, will significantly
improve the experience for both our customers and our crewmembers. Innovative food, beverage and
specialty retail partners will help to define a new ground experience, and we look forward to cutting
the ribbon in September 2008.
New York remains the most congested airspace in the country, but we are optimistic about the
capacity enhancements that are scheduled to take place at JFK over the next several years. We
continue to work with the FAA and The Port Authority on efforts to increase capacity, make better
use of existing capacity, and expedite the use of new technologies to improve efficiency. We believe
the JFK slot controls recently implemented by the FAA will help us reduce costs and improve our
operational reliability.
We have a unique position in New York as JFK’s largest domestic carrier. During 2007, we found new
ways to capture revenue without significant additional costs by announcing our partnership with Aer
Lingus, which enables us to sell our flights directly on the Aer Lingus website. We will continue to
explore opportunities to link our network with other airlines at JFK and other focus cities across our
network.
Revenue Optimization
We continued to focus on making our product easy for our customers to purchase, and we recently
created a Spanish translated version of our website. During 2007, approximately 75%of our total
revenues were booked on our website www.jetblue.com, our lowest cost distribution channel.
In 2007, we increased our change fees and implemented a $10 telephonic reservation fee with the goal
of increasing additional ancillary revenue while directing more revenue through jetblue.com. In
addition, we introduced the Cashless Cabin platform onboard our aircraft to help capture revenue
opportunities at altitude. As a result of all these initiatives, our 2007 ancillary revenues increased
significantly from 2006. We will continue our focus on ancillary revenues in 2008, but we are
committed to ensuring a proper balance between additional fees and any impact on our
award-winning service and brand.
In 2007, we also continued to focus on building customer loyalty, and we now have over five million
members of our TrueBlue loyalty program. We continue to work to diversify our product to attract
higher yielding travelers through initiatives such as our recently announced Refundable Fares.