JetBlue Airways

1998–2000: Founding

JetBlue was incorporated in Delaware in August 1998 with its headquarters in Forest Hills, Queens. David Neeleman founded the company in August 1999 under the name "NewAir". JetBlue started by following Southwest's approach of offering low-cost travel, but sought to distinguish itself by its amenities, such as in-flight entertainment, TV at every seat, and SiriusXM satellite radio. JetBlue sought to primarily use the Airbus A320 family to ease maintenance, taking a similar approach to Southwest, which primarily uses the Boeing 737.

In September 1999, the airline was awarded 75 initial take-off/landing slots at John F. Kennedy International Airport and received its USDOT CPCN authorization in February 2000. It commenced operations on February 11, 2000, with services to Buffalo and Fort Lauderdale.

JetBlue's founders had set out to call the airline "Taxi" and therefore have a yellow livery to associate the airline with New York. However the idea was dropped after threats from investor JP Morgan to pull its share ($40 million of the total $128 million) of the airline's initial funding unless the name was changed.

2000s

JetBlue was one of only a few U.S. airlines that made a profit during the sharp downturn in airline travel following the September 11 attacks. The company's planned initial public offering was put on hold due to the attacks and subsequent downturn. The IPO took place in April 2002, raising $260 million at its NASDAQ debut.

The airline sector responded to JetBlue and Southwest's market presence by starting mini-rival carriers: Delta Air Lines started Song, and United Airlines launched another rival called Ted. Song has since been disbanded and was reabsorbed by Delta and Ted reabsorbed by United.

In October 2005, JetBlue's quarterly profit had plunged from US$8.1 million to $2.7 million largely due to rising fuel costs. Operational issues, fuel prices, and low fares, JetBlue's hallmark, were bringing its financial performance down. In addition, with higher costs related to the airline's numerous amenities, JetBlue was becoming less competitive.

For many years, analysts had predicted that JetBlue's growth rate would become unsustainable. Despite this, the airline continued to add planes and routes to the fleet at a brisk pace. In addition in 2006, the IAM (International Association of Machinists) attempted to unionize JetBlue's ramp service workers, in a move that was described by JetBlue's COO Dave Barger as "pretty hypocritical", as the IAM opposed JetBlue's creation when it was founded as New Air in 1998. The union organizing petition was dismissed by the National Mediation Board because fewer than 35 percent of eligible employees supported an election.

JetBlue experienced its first-ever quarterly loss during the fourth quarter of 2005 when the airline lost $42.4 million, enough to make them unprofitable for the entire year of 2005. The loss was the airline's first since going public in 2002. In addition to that, JetBlue forecasted a loss for 2006, citing high fuel prices, operating inefficiency, and fleet costs. During the first quarter report, CEO David Neeleman, President Dave Barger, and then-CFO John Owen released JetBlue's "Return to Profitability" ("RTP") plan, stating in detail how they would curtail costs and improve revenue to regain profitability. The plan called for $50 million in annual cost cuts and a push to boost revenue by $30 million. In October 2006, JetBlue announced a net loss of $500,000 for the third quarter, and a plan to regain that loss by deferring some of their E190 deliveries and by selling five of their A320s.

In December 2006, JetBlue, as part of their RTP plan, removed a row of seats from their A320s to lighten the aircraft by 904 lb (410 kg) and reduce the cabin crew size from four to three (per FAA regulation requiring one flight attendant per 50 seats), thus offsetting the lost revenue from the removal of seats, and further lightening the aircraft, resulting in less fuel burned. In January 2007, JetBlue returned to profitability with a fourth quarter profit in 2006, reversing a quarterly loss in the year-earlier period. As part of the RTP plan, 2006's full-year loss was $1 million compared to 2005's full-year loss of $20 million. JetBlue was one of the few major airlines to post a profit in that quarter.

While its financial performance started showing signs of improvement, in February 2007, JetBlue faced a crisis, when the blizzard of 2007 hit the Northeast and Midwest, throwing the airline's operations into chaos. Because JetBlue followed the practice of never cancelling flights, it desisted from calling flights off, even when the ice storm hit and the airline was forced to keep several planes on the ground. Because of this, passengers were kept waiting at the airports for their flights to take off. In some cases, passengers who had already boarded their planes were kept waiting on the apron for several hours and were not allowed to disembark. However, after all this, the airline was eventually forced to cancel most of its flights because of prevailing weather conditions.