jet blue case analysis

Essay by jumpingboaUniversity, Master'sA-, August 2014

download word file, 15 pages 0.0

JetBlue Airways Final Case Analysis

Ali Fawaz

Course: 04-75-498 Section 30

Professor: Tony Mao

Submitted on: August 24/2012

Table of Contents

Page

I. Problem Identification

Company Profile……………………………………………………………………………………………………

2

Primary Issue………………………………………………………………………………………………………..

2

Secondary Issues.………………………………………………………………………………………………….

2

II. Internal Analysis

Value Chain…………………………………………………………………………………………………………..

2

VRINE Model…………………………………………………………………………………………………………

2

Summary………………………………………………………………………………………………………………

3

III. External Analysis

PESTEL Model……………………………………………………………………………………………………….

3

Porters 5……………………………………………………………………………………………………………….

4

Industry Analysis…………………………………………………………………………………………………..

5

Summary………………………………………………………………………………………………………………

5

IV. Financial Analysis

Leverage…….…………………………………………………………………………………………………………

5

Liquidity………………………………………………………………………………………………………………..

5

Profitability…………………………………………………………………………………………………………..

5

Cost Analysis…………………………………………………………………………………………………………

6

Revenue and Growth……………………………………………………………………………………………..

6

Summary……………………………………………………………………………………………………………….

7

V. Alternatives

Alternative 1 ………………………………………………………………………….……….……………………

7

Alternative 2 ………………………………………………………………………………….……………….……

7

Alternative 3 ……………......…………………..…..…………………………………………………..……….

7

VI. Recommendation/Implementation

Gantt Chart…………………………………………………………………………………………………………..

8

Contingency Plan………………………………………………………………………………………………….

8

Appendix I………………………………………………………………………………………………………………………..

9

Appendix II - Targeted Growth Based on ASM (Attached Excel File)…................................

X

Problem Identification

Company Profile: JetBlue is an airline company which initially started its operations as a low-cost carrier (LCC). It has since grown to hold 30% of the market for domestic departures. The company has recently undergone a shift in upper management.

An internal promotion of the COO, David Barger, has placed him as the new CEO of the company. The company is currently facing slowing demand and rising fuel costs. The new CEO must make a strategic long-term decision on how to address the airlines rate of growth.

Primary Issue: How to structure further reductions in operations to remain competitive.

Secondary Issues:

How to address the rising cost of fuel.

Addressing the training and operating changes needed to handle the E190.

Pilot seniority and compensation is based on flying hours and the newer E190 would put them at a disadvantage in comparison with A320 pilots.

Internal Analysis

Value Chain

A major component of the primary activities for the company is its large size both financially and from an operating standpoint. The company achieved a milestone when its annual revenue exceeded $1 billion...