JetBlue and Spirit seek minimum service order exemptions

JetBlue Airways and Spirit Airlines have applied for emergency exemptions to the minimum service order outlined in the US government’s CARES Act.

JetBlue Airways and Spirit Airlines have become the first US carriers to apply for immediate exemption from certain service obligations under the Coronavirus Aid, Relief, and Emergency Security (CARES) Act.

The US Department of Transportation (DOT) has stated that airlines receiving aid will be required to maintain minimum levels of service to “all points” in their networks prior to March 1. The mandate extends until Sept. 30. However, where multiple airports serve the same area, carriers will be able to consolidate operations at a single airport.

New York-based JetBlue plans to consolidate operations in the Boston, Los Angeles, New York, San Francisco and Washington metropolitan areas from April 15 through June 1. The airline said the revised schedules would reduce excess flying “during a time of unprecedented low demand for air travel” while maintaining a critical level of service.

“We face new challenges every day and can’t hesitate to take the steps necessary to reduce our costs amidst dramatically falling demand so we can emerge from this unprecedented time as a strong company for our customers and crewmembers,” JetBluehead of revenue and planning Scott Laurence said.

In a filing with the DOT on April 8, JetBlue said it intends to temporarily stop service at eight airports from April 15 but will continue to serve each area through other points in its network. For example, it will end flights to Baltimore/Washington (BWI) but continue flying to Washington National (DCA).

In addition to BWI, it will end service to Hollywood Burbank (BUR), LaGuardia Airport (LGA), New York Stewart (SFW), Ontario International (ONT), San Jose Mineta International (SJC), TF Green International (PDV) and Westchester County (HPN).

However, the carrier is also seeking exemptions from minimum service obligations so that it may suspend service to 11 other US airports: Aguadilla (BQN), Albuquerque (ABQ), Bozeman (BZN), Dallas Fort Worth (DFW), Houston (IAH), Mercedita (PSE), Minneapolis St Paul (MSP), Portland (PDX), Reno-Tahoe (RNO), Sacramento (SMF) and Worcester (ORH).

“At these airports, JetBlue intends to temporarily suspend service effective April 15, 2020, through June 10, 2020, and therefore respectfully request an emergency exemption allowing it to load these schedule changes and make the necessary operational plans as soon as possible,” the airline said.

The filing with the DOT added: “The competitive situation has drastically worsened, even in the last few days. It has been well-documented that travel nationwide is down more than 90%. In some metropolitan areas, including New York, the reduction is closer to 100%.

“Simply put, there are so few customers traveling to justify even the reduced service levels required by the order, and a rigid interpretation of the service obligation will only threaten to unnecessarily diminish JetBlue’s liquidity, with no commensurate public interest benefit.”

JetBlue said it would earn about $1 million in revenue each day in April, compared with $22 million each day during the same month a year ago. Its current reduced operations cost about $10 million per day.

The carrier added it plans to gradually resume service to each of the affected airports “as soon as it is both safe to do so and when even the slightest customer demand re-emerges.”

Meanwhile, Fort Lauderdale-based Spirit has also submitted a request for exemptions from service obligations to the DOT.

The ULCC’s filing said it was not reasonable or practical to operate to certain cities in its network as doing so would “rapidly exhaust Spirit’s financial resources and manpower, while adding virtually nothing to those cities access to air transportation at this time.”

The airline has, therefore, requested to drop 26 cities from its network, including Austin, New York, Pittsburgh, Portland, Richmond, and San Francisco.

Spirit said serving these areas would not be in the public interest given the “extremely low” passenger demand, adding that some cities included in the request are also well-served by other airlines.

The carrier also stressed that if it is forced to continue service to all points in its network, it will harm its ability to “restore service as the pandemic ends and deny consumers the low fare service Spirit wants to bring back to the public.”