Why JetBlue Loves Boston So Much

Posted by: Justin Bachman on October 29

Is Boston destined to be a hub airport? Not, of course, in the traditional sense with a network airline aggregating passengers the way they do in Atlanta and Chicago. But JetBlue’s (JBLU) aggressive expansion in Beantown – including a major push planned for 2010 – coupled with Southwest’s (LUV) arrival two months ago makes Boston the next big front in the battle to wrest market share from the legacy carriers.

JetBlue aims to double its operations at Logan in five years, including a 30% jump in flights it announced on Thursday. Most of these are increased frequencies to existing destinations, but they’re notable: three flights per day to O’Hare; seven to Washington-Dulles; two to Denver, San Diego, and San Francisco; five to Baltimore; and four to Fort Lauderdale. All these destinations have fierce nonstop competitors, including Southwest. By next summer, JetBlue will have 78 daily flights to 33 destinations. It is already the largest carrier at Logan with a 17% share of passengers, according to federal data.

If JetBlue is able to keep pace with its current growth schedule, its Boston operation will be two-thirds the size of its primary JFK home base by 2014. The airline has nearly 200 daily flights at JFK now, with a 41% passenger share. What’s more, Boston Logan is not constrained by the slot restrictions federal authorities have imposed on the three major New York airports, a trio that is the very definition of overscheduled and delay-plagued. A low-cost entrant can schedule its growth in Boston virtually unhindered. “There’s a lot more to come,” says Dave Clark, JetBlue’s director of route planning.

JetBlue and Southwest do not use the word hub, preferring instead to talk about focus cities. Southwest focuses heavy capacity in Baltimore, Chicago-Midway and Phoenix, for example. JetBlue is mostly a New York-JFK and Boston operator, with smaller “focus” activities in Long Beach, Orlando and Fort Lauderdale. Southwest also has expansion plans at Boston, where it started service on Aug. 17 with five daily flights each to Baltimore and Chicago. In January, it will begin two daily flights to Denver, another hotly contested airport where Southwest has designs on taking further market share from United (UAUA). Clark says he expects Southwest to pursue "modest growth" in Boston, a city whose suburbs it already serves via Manchester and Providence. But regardless of what Southwest does, one can expect JetBlue to continue investing heavily in massing greater share.

Boston, the home of severe winter weather and tucked into a corner of the nation, has never been a good candidate as an airline hub. Still Logan has become -- if not a hub -- an airport with a heavy "focus" from the low-cost crowd.