JetBlue Aligns With Activist Investor, Evaluates Airbus XLR Range

Discussions with activist investor Carl Icahn have been constructive, says JetBlue Airways CEO Joanna Geraghty.

Icahn announced his involvement in February as one of the carrier’s largest shareholders and has since installed two of his executives on the board. The former Trans World Airlines chairman’s investment came as JetBlue was plotting organic growth following a failed merger with Spirit Airlines.

Outwardly, Icahn’s involvement has appeared more placid than that of Elliott Investment Management at Southwest Airlines, where contentious and public back-and-forth sparring has spurred a shakeup on the carrier’s board. But rather than seeing Icahn as less vocal, Geraghty instead described alignment on key priorities.

“We’ve had really constructive discussions,” said Geraghty at the Skift Global Forum on Sept. 19. “I’ve been seeing what’s happening at Southwest, I don’t wish it on anybody because it’s hard, it can be distracting at times. But at the end of the day, we are all focused on trying to drive a better business ... we’re focused on returning to profitability, and we are all aligned in that regard.”

To achieve that goal the LCC is working its way through a multi-year strategy, following two pursuits shuttered by separate federal rulings—its Northeast Alliance with American Airlines and the attempted merger with Spirit.

“We’ve been through a number of challenging times regarding failed transactions with the Department of Justice, and so now our focus is on executing our organic strategy, and our full board is on board with that,” Geraghty added. The airline’s board has 13 members.

Recently JetBlue has noted progress from the “JetForward” plan, which seeks to achieve $300 million in incremental revenue initiatives in 2024. The plan also includes cost cuts and aircraft deferments, including for the Airbus A321 XLR, of which JetBlue has 13 on order, according to Aviation Week Network’s Fleet Discovery Database. Its CEO is now evaluating the variant’s range, scrutiny that closely follows a decision from Frontier Airlines to drop XLRs from its fleet plan, citing disappointment.

“I’m trying to calibrate whether they’ve updated it to reflect some of the weight variances they’ve had to add to it, and whether that range is accurate anymore,” Geraghty said. “It’s from the aircraft manufacturer, you have to keep that in mind. Airlines always do their own studies to make sure that’s accurate, and sometimes it’s not.”

The carrier still sees the XLR as a “great plane for the future,” Geraghty added, noting a desire to first work through the Pratt & Whitney geared turbofan engine issues grounding some of its A320neo family fleet before taking delivery of a new variant.

As part of its go-forward vision, JetBlue has been prioritizing leisure, premium leisure, and visiting friends and relatives (VFR) markets, and its premium Mint product is one of the factors driving network changes as it optimizes use of its assets. Working to meet growing customer demand for premium offerings, the LCC has now announced intent to open its first-ever airport lounges, at New York JFK in late 2025 and at Boston Logan International Airport soon after. Depending on how they perform, more in other locations could follow.

Complementary lounge access will be available to transatlantic Mint customers, TrueBlue Mosaic 4 members, and holders of a soon-to-be launched premium JetBlue credit card.

“Lounges are probably the single most significant thing customers have asked for that we have not offered,” Geraghty said.

Acknowledging the trouble other airlines have had with overcrowding she added, “One of the benefits of being small—since we’ve had some challenges trying to get bigger—is that we can be very bespoke about it, and have a very high level of focus and attention.”