Jet Blue Corporate History

This article was written by Phineas Upham

Jet Blue was founded by David Neeleman, and it is a Delaware based company that was incorporated in August of 1998. Neeleman called his new company “NewAir.”

Neeleman and some of the executives in JetBlue came from Southwest Airlines, and the company began life by offering a low-cost fare to incentivize travel. The trick was that they also offered some in-flight amenities, like television and satellite radio stations, at every seat on the plane. Neeleman said, in his own words, that he hoped “to bring humanity back to air travel.”

It got permission to occupy 75 spots at John F. Kennedy airport for take-off and landing, and started formal operations to Buffalo and Ft. Lauderdale within a year.

The airline originally wanted a yellow motif to go along with the name “Taxi.” This was not a popular idea for a few reasons. Air traffic controllers would have difficulty relaying the plane’s positions because of the name, and the company’s prime investor JP Morgan threatened to pull its funding if the name stuck.

After 9/11, there was a large downturn in airline travel. Yet JetBlue managed to thrive, until rising fuel costs began to eat away at JetBlue’s competitive edge. Forecasters called JetBlue’s growth unsustainable, even after the company added a fleet of new planes to its inventory. In response, the company instituted a “Return to Profitability” plan that detailed cost cutting measures and efficiency needed to bring the airline back to prominence.

Today, JetBlue offers international flights and is considered one of the largest airlines in the Northeastern section of the United States.

Phineas Upham

About the Author: Phineas Upham is an investor at a family office/hedgefund, where he focuses on special situation illiquid investing. Before this position, Phineas Upham was working at Morgan Stanley in the Media & Technology group. You may contact Phineas on his LinedIn page.

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