JetBlue, Airbus Manage Delivery Delays In 2023

JetBlue Airways is bracing for what it deems a modest delay in aircraft deliveries next year, but the company is stressing those changes won’t impact its plans to grow capacity in the mid- to high-single digits in 2023.

During an earnings discussion on Oct. 25, JetBlue’s CEO Robin Hayes said the airline looks forward to taking delivery of a handful of Airbus A321LR aircraft in 2023 for its expansion into Europe, “notwithstanding some modest delivery delays.” With respect to the airline’s planned growth in Europe outside its service to London’s Heathrow and Gatwick airports, Hayes said: “Stay tuned for an announcement in the near future.”

JetBlue is contractually scheduled to take delivery of 29 aircraft in 2023—18 A220-300s, six A321neos and five A321LRs.

But the company’s CFO Ursula Hurley said that “from a planning assumption perspective, we’re expecting 22 [deliveries].”

She said JetBlue is “working hand-in-hand” with Airbus to manage through the delays in aircraft deliveries.

Offering a bit more context into JetBlue’s assumptions regarding deliveries in 2023, Hurley said the airline is planning to accept 14 A220s instead of the 18 originally scheduled for delivery. The airline is contractually retiring six Embraer 190s as well as some of the 30 aircraft JetBlue owns, she said.

Hurley explained with those 22 aircraft, JetBlue believes it can deliver on plans to grow capacity in the mid- to high-single digits in 2023. Its current projections for capacity growth in 2022 compared to 2019 are flat to an increase of 2%.

JetBlue has some levers to pull to meet those capacity targets, including pushing back aircraft retirements and increasing aircraft utilization. “We’re trying to give as much color on 2023 as we can based on what we know today,” Hayes said. “We accept there is a macroeconomic question mark out there. We’re not seeing signs of concerns around that today.”

The airline also believes that if it takes delivery of 22 aircraft next year, it can deliver a unit cost performance excluding fuel that is flat or better than 2019. But Hayes said that cost forecast is “built off the capacity assumptions we’re making today.”

As JetBlue navigates some uncertainty in its 2023 aircraft deliveries, the airline posted the highest quarterly revenue results in its history during the third quarter (Q3), at $2.6 billion, an increase of 30% year-on-year. Its expenses jumped roughly 36% to $2.4 billion, driven by an 86% increase in fuel costs and related taxes to $825 million.

The airline recorded a net income of $57 million during Q3 compared with $121 million the year prior.


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