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Neeleman Explains Himself


By Maria Bartiromo And you thought you've had some bad weeks. In the space of six days, CEO David Neeleman saw JetBlue's (JBLU) customer-friendly image get buried by an ice storm in New York that turned the airline into bedlam central. Neeleman has since been making almost Japanese-style gestures of corporate contrition, issuing a Customer Bill of Rights and even apologizing on the Late Show with David Letterman. I talked with Neeleman about how JetBlue can rebuild its once-loyal, almost fanatical, following.

Where is JetBlue in terms of recovering?

We're back to normal, but no one's resting and...I'm just like poking everybody as hard as I can, saying, "Ice storm's coming tomorrow, everybody. Ice storm's coming. How do we make sure this never happens to us again?" And I'm convinced if it happened tomorrow, we would be maybe as good as we have been in the past on snowstorms. But I am convinced if it happens two weeks from now that we're going to be 10 times better than we've ever been. And if it happens, let's see, Apr. 1, it's going to be amazing how we'll be able to deal with it.

Mm-hmm. So tell me again, how did things go so wrong?

[Valentine's Day] was all messed up, and it was really difficult because ice was just caking [JFK] Airport. At that point, we had to cancel flights. And with 250 flights with an average of 5 crew members per flight, we had 1,200 crew members who were displaced from their next line of flying. Now you have planes and people displaced and you have to figure out...how do I put Humpty Dumpty back together again. So we canceled more flights on Thursday and tried to set up for Friday. At that point, we had started running behind, and things were becoming more complicated and it was more difficult to find crew members.... And when one thing, like the crew services thing, gets overwhelmed, it just has a trickle-down effect.

Have you reached out to other executives or management gurus for advice?

Well, no, I haven't. Certainly, there was a question of, where did we get our crisis management training from and who helped me decide what to do. Basically, [it was] nobody. I mean, we've been through similar crises before...and it's a pretty simple formula. When you mess up, you just apologize and fix what it was that you did wrong and explain why it won't happen again.

Did you consider stepping down?

No. Absolutely not.

Do you think this crisis was a failure of training, a lack of contingency planning, or a flawed business model?

Lack of a contingency plan. When you run as good as we have run, I don't think you're as good at [crisis management].

How damaged is your brand?

I'm getting a lot of e-mails, obviously—a lot of supporting e-mails but a lot of "You jerk, you ruined my vacation" e-mails.

Who will ultimately take the fall for how this was handled?

Our president is also our chief operating officer, and we had already decided before this event to bring in a really strong COO. One thing you have to keep in mind is that we've run the best airline for the last seven years, so we had a really bad event, disappointed a lot of people, and hurt our brand. But that doesn't mean that our people aren't good...and I'm a little bit reluctant right now to throw them all out. But I do think we need additional bench strength.

Is there any reason to believe that all this is going to have an impact on more than the first quarter?

Well, I hope not. I mean, I don't know.

Maria Bartiromo is the anchor of CNBC's Closing Bell.


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