JetBlue Airlines 2011 Annual Report Download - page 42

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Overview
We are an award winning airline with a differentiated product and a unique culture focused on our
commitment to customer service. We offer competitive fares primarily on point-to-point routes, operating a
young, fuel efficient fleet of 120 Airbus A320 aircraft and 49 EMBRAER 190 aircraft. Our core product offers
customers the unique JetBlue Experience, which includes more legroom than any other domestic airline’s main
cabin, free in-flight entertainment, pre-assigned seating, unlimited snacks and the airline industry’s only
Customer Bill of Rights, which provides for compensation to customers who experience avoidable
inconveniences (as well as some unavoidable circumstances) and commits us to perform at high service
standards and holds us accountable if we do not. At December 31, 2011, we served 70 destinations in 22 states,
Puerto Rico, Mexico, and 12 countries in the Caribbean and Latin America and operated over 700 flights a day.
Our goal is to become “the Americas’ Favorite Airline” — for our employees, whom we refer to as
crewmembers, customers and shareholders. We are committed to doing so by focusing on three main attributes,
investing in our culture including our people; through our offerings including our fleet, product and network; and
through foundations, including our processes and systems.
Over the past year, we made improvements to our offerings. Most notably, we executed on our network
strategy, by strategically growing in our key Boston and Caribbean markets. We worked to reduce some of the
seasonality in our network associated with our traditional leisure travel base by attracting more business
travelers. Our focus on offerings resulted in a strong year of double-digit increases in unit revenue with operating
revenues per available seat mile for 2011 increasing 11% over 2010. We strengthened our position as the largest
carrier in Boston by adding five new destinations from Boston during 2011. We also invested in airport
infrastructure changes in Boston to enhance the customer experience with new systems and additional airport
space. We continued our focus on building our relevance to the business customer travelling to and from Logan
Airport. In the Caribbean and Latin America region, we continued to increase our presence and reached
milestones in 2011, by becoming the largest airline serving both Puerto Rico and the Dominican Republic. In
particular, our expansion in San Juan, Puerto Rico included the introduction of intra-island service to many of
our Caribbean destinations. We have approximately 25% of our capacity in the Caribbean and Latin America
region. We are focused on optimizing our schedule and balancing our network to serve a diversified customer
mix of leisure travelers, business travelers and visiting friends and relatives’, or VFR, traffic.
We continually seek to enhance our product and provide our customers with superior service. In June 2011,
we re-branded and expanded our popular Even More Legroom offering, now known as Even More Space, which
includes extra legroom plus early boarding and early access to overhead bin space. Additionally, we introduced
Even More Speed, which offers customers the option to enjoy an expedited security experience in select JetBlue
airports. Throughout 2011 and 2012, we expanded the number of cities in which Even More Speed is offered to
include over 30 of our airports and we will continue to increase the number of cities this expedited security
feature is offered in as we work with airport authorities. In 2011, we executed an agreement with ViaSat Inc. to
develop and introduce state of the art in-flight broadband connectivity technology on our aircraft. In the fall of
2011, ViaSat successfully launched the satellite which will eventually support this effort. We continue to develop
the in-flight broadband connectivity solution and plan to introduce it on our fleet in 2013.
In 2011, we also expanded our route network. We commenced service to Providenciales, Turks and Caicos
Islands in February 2011, Anchorage Alaska and Martha’s Vineyard in May 2011, La Romana, Dominican
Republic and Liberia, Costa Rica in November 2011, and St. Croix and St. Thomas in the U.S. Virgin Islands in
December 2011. We have announced plans to begin service between Dallas/Fort Worth, Texas and Boston in
May 2012. In November 2011, we had the winning bids in an auction to acquire eight take-off and landing slots
at each of New York’s LaGuardia Airport and Washington DC’s Ronald Reagan National Airport. We plan to
begin our expanded service at each of these airports in 2012.
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