JetBlue to slash flights as soft travel demand threatens bottom line: report
JetBlue Airways is planning new cost-cutting measures such as reducing flights and parking aircraft, as soft travel demand makes achieving a breakeven operating margin in 2025 'unlikely,' according to an internal memo seen by Reuters.
The carrier will also look to wind down underperforming routes while focusing on profitable ones, and is reassessing the size and scope of its leadership team, JetBlue CEO Joanna Geraghty said in the memo to employees.
JetBlue shares fell 3% in afternoon trading and have lost more than 42% this year.
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The New York-based carrier is facing soft travel demand and higher operating costs.
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'We're hopeful demand and bookings will rebound, but even a recovery won't fully offset the ground we've lost this year and our path back to profitability will take longer than we'd hoped,' Geraghty said.
The New-York based airline is facing higher operating costs as ongoing inspections of RTX's Pratt & Whitney's Geared Turbofan engines have grounded a number of its aircraft.
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U.S. airlines are also under pressure from President Trump's trade policies and sweeping tariffs that have fanned economic uncertainty and made Americans conscious about spending on travel.
As a result, major U.S. airlines are scaling back capacity ahead of the typically busy summer travel season as they look to protect fares and adapt to weaker demand.
'While most airlines are feeling the impact, it's especially frustrating for us, as we had hoped to reach breakeven operating margin this year, which now seems unlikely,' JetBlue's Geraghty said.
JetBlue's hangar at Orlando International Airport
Markus Mainka – stock.adobe.com
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The company had withdrawn its 2025 forecast in April citing a weakening demand environment.
JetBlue had earlier revealed plans to defer deliveries of 44 new jetliners, cutting planned capital expenditures by about $3 billion between 2025 and 2029. It was also cutting down on some unprofitable routes.
The carrier also plans to pause retrofitting six of its Airbus planes and will park them instead, according to the memo.
The airline declined to comment on the cost-cut measures, which were first reported by CNBC earlier in the day.
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