Title: Date: Case Analysis: JetBlue Airways Corporation 2009 Background information JetBlue was founded 1998 in Delaware and started its operations in 2000 with its major services in New York the J. F. Kennedy airport, since then the company as joined the global market and operated routes in other countries…
The company core values are commitment to safety of its customers and the crewmembers, ensures respect between the passengers and crew members, achieving passion this is by striving to meet the needs of passengers and the crew members and integrity this is by honesty demonstration mutual trust and commitment to JetBlue improvement. The company is ranked tenth in the United States airline by traffic. The company top management is made up of CEO ( David Bager), Rusell Chew and President &COO, Chief Financial Officer, Executive VP and CAO( Edward Barnes), head of legal department and Ex. VP of corporate affairs( James Hnat), Sr VP of customer services(Rob Maruster). Problems/ strategic issues Labor unions contract has been the major complication that the airlines are facing. The labor unions objective is maximizing the welfare of the members thus they end up taking a long period of time negotiating for better remuneration of the members. If the results of the negotiation are below the expectation of the labor unions the labor union officials may result in requesting their members to participation in industrial action The cost of fuel and consumption has been rising annually this has been due to increased number of flights and increased oil prices. The level of obesity as also contributed to the high cost of fuel and consumption. ...
A chart showing increase in price per gallon A table illustrating increase consumption of fuel as at 31st December 2008 2007 2006 Number of gallons consumed 453000000 444000000 377000000 Total cost of gasoline $1352000000 $929000000 $752000000 Terrorism has been a concern in air security in the United States the congress has taken charge for airlines security.in November 2002 the transportation security administration (TSA) took charge of all the airports. The (TSA) installed detectors of explosives in the airports. Almost all airlines worldwide experience delays in their flights, for one reason or the other. Some of reasons attributed to the delay include, airport congestion, flight maintenance, bad weather conditions, unsafe environment and emergencies on the tarmac. Financial analysis of the company Analysis of the company financial statement is essential in order to ascertain the financial soundness of the company. Under this section we will carry out a ratio analysis in order to analysis the financial health of JetBlue Airways Corporation. Profitability analysis Profitability analysis assist in determining whether the firm has the ability of generating profits on the funds invested. The gross profit margin for the company in April 2009 was 26.18%. This is an indication of the firm returns on costs, as compared to the industry it shows that the firm sales have the highest capability in the industry of generating sales, since the industry gross margin is 22%. Liquidity analysis The company has quick ratio of 0.82 while the recommend ratio is 1:1, therefore, this figure is shows that the company can be able to meet its current obligations as the fall due. This led the ...
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It is a well established firm in the airlines industry that maintains stable profitability. From (Airlines renew debate over low-cost model, 2011).Nowadays, it is becoming difficult for low cost airlines companies to confront with market competition due to different factors.
United States offers an expansive market with numerous niche sub-markets which have many Americans who prefer commercial air travel mainly because of time and cost related factors. Low profit margins and stunted growth are the duplicated scenarios in the American airline industry but one notable airline, Southwest Airlines, has defeated the odds in this arena to succeed even where all the rest seem to have failed.
Offer Product differentiation in the form of New Carriers, different upscale interiors and entertainment facilities at affordable prices Offer point-to-point flights to large and underserved markets in the same price segment. The above premises indicate the capability and its communication to the market as to increase the frequency of flights on a sustainable basis.
Kennedy International Airport. The airline officially started its operations in 2001 where it operated from the Boston's Logan International Airport and Long Beach Airport. Jet Blue company grew over the years of operation and begun to operate throughout the United States and extended to Mexico and the Caribbean.
It is seen that main fixed costs for Jetblue are staff welfare and benefits which form nearly 23% of revenue. However, the expenditure under this head is reducing with each passing year, mainly due to increased revenue which offsets the staff costs.
ity to foster a healthy organization culture with deep understanding of behavioral science to bring in much needed JetBlue experience for crew members and customers. This organization goals have been achieved through effective leading, controlling, planning and organizing
Costing techniques facilitates the organization to utilize such financial resources more optimally. Costing techniques are essentially not reflected in a company annual reports or financial statements. These occur separately and are provided to mangers and stakeholders as
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