JetBlue is deferring the delivery of 44 Airbus A321 aircraft until at leat 2030 in a $3 billion cut in planned expenditure to secure the carrier’s financial future.
The New York-based low fares carrier is also withdrawing more than 50 loss-making US services.
The disclosure came as the airline, which operates a string of transatlantic routes in addition to its US network, reported a second quarter profit of $25 million, a figure which exceeded previous guidance despite being down almost 82% year-on-year.
JetBlue is targeting $800 million to $900 million in incremental core profits in 2027 by running a reliable operation and refocusing on leisure travel demand in New York, New England, Florida and Latin America.
The airline’s operations have also been affected by troubles with Pratt & Whitney Geared Turbofan (GTF) engines, which have forced it to take a number of its aircraft out of service.
Chief executive Joanna Geraghty said: “Today, and as the year progresses, we are excited to share more details about JetForward, our strategic framework to return JetBlue to sustained profitability, and the four priority moves aimed at driving significant value over the coming years.
“These include boosting reliability and doubling down on our commitment to caring service to improve satisfaction and drive cost savings; reinvesting in building the best leisure network on the [US] east coast, where we are positioned to win; enhancing our existing product offerings and loyalty perks to better deliver the elevated and differentiated experiences our customers want; and keeping our costs low so that we can continue to offer customers exceptional value in the sky as we build a secure financial future for JetBlue.”
Chief financial officer Ursula Hurley added: “We are setting ourselves on a path to restore our balance sheet health, and in support of securing our financial future, we are announcing an incremental aircraft deferral of approximately $3 billion of planned capital expenditures.
“Our focus going forward will be on driving value from our existing asset base and, ultimately, generating positive free cash flow.”
JetBlue president Marty St George said: “As we progress through the second half of the year, we’ll be announcing additional initiatives designed to further enhance our customer value proposition, close the gap in our product offering to our peers and drive significant financial benefit.
“As we execute on our strategy to return to profitability, we remain focused on delivering on our near-term financial goals.
“In the second half, we expect sequential year-over-year unit revenue momentum to bolster the top-line, supported by our $300 million of revenue initiatives and the continuing normalisation of competitive capacity in our core geographies.”
JetBlue and ultra-low cost rival Spirit Airlines called off a $3.8 billion merger earlier this year after the deal was blocked by a federal judge.