Dave BargerTravel Weekly's Kate Rice spoke with JetBlue President and CEO Dave Barger about Mint, the airline's new premium product that it is introducing on transcontinental routes.



Q: Is JetBlue abandoning its egalitarian roots with Mint?

A:
The Mint experience can't compromise our Core experience; we don't even let our team use the word "coach." As we were putting this together over the past two years, I said that I wanted to talk about Core twice as much as we talk about premium, because that is where most of our customers live.

Our average fare in the last quarter was $160 plus taxes and fees. I think that is why Mint is going to be so disruptive [in the transcon market]. There are plenty of lie-flat beds, there is plenty of in-flight entertainment.

Q: How can JetBlue make money with this kind of pricing?

A:
It's an absolute layup, because it is such a thick market when it comes to customers who are willing to purchase those seats, and the fares are so exorbitant. In a commodity business, people will pay for a premium product. We want buzz. We want people to experience the product.

Q: What about the passengers back in coach?

A:
The percentage of seats allocated to Mint is very small.

We've got the Marketplace where the curtain traditionally is. If you want something, you get up and help yourself. You don't need a flight attendant, although they are there to help you. It is cool to have that kind of geography on an airplane. It takes a little of the hassle out of air travel.

When I look at the totality, the Core offering is getting even better. And we have things that are so helpful to the brand, things like the first bag is free. The public doesn't want to get nickeled-and-dimed. We are not looking to change any of that type of thing.

Q: There's been some speculation about JetBlue being a takeover target. What's your response to that?

A:
We have been very direct about independence being the path for us. We believe our independence and our organic growth plan provide a much better trajectory for improving our earnings over the short, medium and long term. We are a brand that is opportunistic.

Q: How would you talk about your image with the analyst community?

A:
To the analysts who say, "Who are you guys?" we say, we are not a network carrier, we are not bankrupt. We are not a super discounter. We live in the sweet spot. We have a lower cost structure than the big guys. We are higher cost than the ultra low-cost carriers. We live in a very investible spot.

We think there are at least three models in the airline space. I draw people's attention to brands like Target when I think about department stores or Enterprise and how they built up over time in the rental market. I enjoy these conversations about how if you're in the middle, you're not going to survive. I think they're a little bit narrow in their thinking, and I've shared that with them. We enjoy the jousting back and forth.

Q: Is JetBlue at a disadvantage because it's not in an alliance?

A:
We love open architecture. We are partnering with 25 airlines. We have a two-way codeshare with South African Airways. We will roll out a codeshare with Emirates. We can partner with unaligned airlines like Emirates. We can partner with SAA, which is part of the Star Alliance. Korean Air is part of SkyTeam. Alliances are complex. They add cost. And, in an alliance, if you're the short-haul guy, you're penalized.

Q: Are the new Mint fares in GDSs?

A:
It is in the GDSs.

Follow Kate Rice on Twitter @krtravelweekly.
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