American unveils new refundable fares, more benefits with JetBlue alliance

American Airlines is rethinking its approach to business travel with new refundable fares launching next year.

The Fort Worth, Texas-based carrier unveiled a new "Main Select" product on Tuesday, which will be available in key business markets, including the Northeast shuttle routes, with expanded benefits.

The "Main Select" fare will offer a fully refundable ticket along with a handful of other perks, including priority Group 4 boarding and check-in, complimentary access to extra-legroom Main Cabin Extra seats and free same-day flight changes. At launch, the fare will be available on high-frequency business routes between New York LaGuardia (LGA) and both Chicago (ORD) and Washington National (DCA), between Boston (BOS) and DCA and on select routes from Los Angeles (LAX) and Dallas-Fort Worth (DFW).

Want more airline-specific news? Sign up for TPG’s free new biweekly Aviation newsletter!

There's no telling yet how American will price this fare, but elite travelers may consider passing on this offer since many of the benefits are already included with status.

As part of the move, American is retiring its Shuttle product, which offered shorter check-in cutoff times, dedicated kiosks and more-convenient boarding gates. As part of the move, American will be pulling out of the Boston to New York/LaGuardia market in January, and JetBlue will operate exclusively in that corridor going forward.

In a statement, Vasu Raja, American's chief revenue officer, explained that the move "means creating an easy and seamless travel experience that has the amenities [business customers] want, the flexibility they need and a network that offers access to any destination they want to go.”

American's new Main Select fare isn't the only new bundle that the airline will sell — recently, the airline began offering a "Main Plus" upgrade, which offers complimentary access to Main Cabin Extra and preferred seats, along with an additional checked bag and Group 5 boarding, for an upcharge over the standard coach fare. A carrier spokesperson confirmed to TPG that American will only sell one buy-up on eligible routes — meaning that you'll either be offered the Main Plus or Main Select upgrade, but not both.

Interestingly, American's new Main Select offering will complement JetBlue's existing "Blue Extra" fare, which offers free same-day changes and other similar benefits for an upcharge compared to the standard coach fare. While the two airlines can't coordinate on fares as part of the Northeast Alliance, this is seemingly as close as they can get without discussing fares.

As the two airlines team up in the Northeast, American and JetBlue will market a similar bundle of fares, which helps streamline the experience for customers. (However, once you step foot on a JetBlue plane — equipped with free high-speed Wi-Fi, power outlets, USB ports, entertainment screens and walk-up pantries — you may not miss flying with American.)

Along with the new refundable fare, American and JetBlue continue to tout the benefits of the Northeast Alliance, despite the pending lawsuit from the Department of Justice alleging that the pact is anti-competitive.

For one, the recently announced reciprocal elite benefits are getting expanded on Tuesday to include free access to preferred seats for JetBlue Mosaic members traveling on American. This joins the existing benefits unveiled earlier this fall, including priority boarding, priority security and additional checked bag allowances.

Additionally, redeeming American AAdvantage miles for JetBlue flights will begin later this month.

Other than the frequent flyer perks, American says that the Northeast Alliance has opened nearly 60 markets for customers in New York and more than 48 markets in Boston. Since January, the tie-up has yielded 58 new routes, increased frequencies on more than 130 routes and codesharing on 175 routes. By next year, the Northeast Alliance will have created 18 new international routes.

The Northeast Alliance has already drawn a strong competitive response. Delta Air Lines recently unveiled a New York-focused expansion, as well as new long-haul service from Boston to Athens, Greece, and Tel Aviv — a seemingly tit-for-tat move after American launched new routes there from New York-JFK. Earlier this year, United Airlines returned to New York-JFK for the first time in five years.

Together, all these moves would seem to weaken the DOJ’s case against American and JetBlue. Until the suit gets its day in court, flyers headed to or from the Northeast will enjoy many more flight options than ever before, along with expanded benefits and other perks.