JetBlue, which recently outbid Frontier Airlines to buy ultra-low-cost carrier Spirit is laying out its case for why federal regulators should allow the merger to go ahead, largely by turning the competition argument on its head.
JetBlue’s network is concentrated in New York, Boston, Florida and the Caribbean, with some longer-distance flights to West Coast cities. Regulators have expressed concern about JetBlue becoming more dominant in areas where it is already strong, especially the Northeast, where it has an alliance with American.
But JetBlue’s Chief Operating Officer, Joanna Geraghty, waved that concern aside in a speech at this week’s Skift Forum, saying that the merger would actually increase competition even if JetBlue continues strong in its current hubs, because over 80% of domestic air traffic is in the hands of AA, United, Delta and Southwest, and much of that is in the states that JetBlue either flies over or doesn’t fly to—but would by integrating Spirit’s network.
Geraghty pointed to JetBlue’s history as a carrier of entering markets with its lower cost fare structure and bringing down fares in those areas overall. “JetBlue just wants to compete,” she said Tuesday. “We want to be a national challenger brand.”
