Not fair? JetBlue, Spirit cite precedent in asking DOT to suspend flights to 16 hubs
There was plenty of room to spread out on a recent JetBlue Airways flight to Minneapolis/St. Paul from Boston. Only two passengers joined crewmembers on the 162-seat Airbus A320 that, at least to the airline, exemplifies why it should be able to suspend service to the city amid the coronavirus pandemic.
The New York-based carrier has renewed its push to suspend service to 16 large hub airports across the U.S. that – for now — it must serve as a condition of its payroll assistance from the federal coronavirus aid package known as the CARES Act. JetBlue accepted $936 million in aid.
Spirit Airlines joined JetBlue in renewing its push for air service waivers from the Department of Transportation. The South Florida-based discounter wants to suspend flights to six airports that are hubs for other carriers — Charlotte (CLT), Denver (DEN), Minneapolis/St. Paul (MSP), Phoenix (PHX), Portland, Oregon (PDX) and Seattle (SEA) — during the pandemic.
Both JetBlue and Spirit were denied nearly all of their first waiver requests to suspend service to a number of airports.
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Both requests center on the waiver granted to Massachusetts-based Cape Air that allowed it to suspend flights to New York John F. Kennedy (JFK) airport for the duration of the crisis. The DOT cited the regional carrier's small size — defined as any airline with less than a 10% share of the U.S. domestic market — and the "abundant service" to JFK on other airlines.
The arguments highlight the unusual predicament that airlines face. In non-pandemic times, there is seldom a day when Cape Air, the 13th-largest airline in the U.S. by passengers in 2019, would set a precedent that its much larger peers want to follow.
Such is the airline industry in the days of corona.
Related: JetBlue, Spirit rejected by DOT on nearly all bailout waiver requests
The coronavirus has decimated demand for air travel. On average there were only 17 people on domestic flights during the week ending April 28, the latest data from industry trade organization Airlines for America (A4A) shows. While the numbers are dismal, they are up slightly from fewer than 10 people on flights during the week ending April 14.
"The situation facing JetBlue continues to deteriorate and compliance with the [DOT] order will significantly harm JetBlue's financial liquidity and threaten to undermine the national economic recovery," the airline said in its waiver application on April 27. Load factors, or the percent of seats filled, on flights to the 16 cities in question are as low as 3%, JetBlue added.
JetBlue and Spirit want the Cape Air precedent applied to them. Both carriers said there is near-zero passenger demand for their flights to the 16 airports in question, all of which are hubs for other airlines.
Related: Spirit revamps schedule with circle routes so it can receive coronavirus aid
The 16 airports that JetBlue wants to suspend flights to are:
- Atlanta (ATL) - Delta hub and Southwest Airlines base
- Charlotte - American hub
- Chicago O'Hare (ORD) - American and United Airlines hub
- Dallas/Fort Worth (DFW) - American hub
- Denver - Frontier Airlines and United hub, Southwest base
- Detroit (DTW) - Delta hub
- Houston Bush Intercontinental (IAH) - United hub
- Las Vegas (LAS) - Southwest base
- Minneapolis/St. Paul - Delta hub
- Nashville (BNA) - Large Southwest presence
- Philadelphia (PHL) - American hub
- Phoenix (PHX) - American hub and Southwest base
- Portland - Alaska Airlines hub
- San Diego (SAN) - Alaska focus city and Southwest base
- Seattle/Tacoma - Alaska and Delta hub
- Tampa (TPA) - Large Southwest presence
Related: JetBlue begins flying new "tag" routes in order to comply with CARES Act
The DOT has taken a more nuanced approach to other airlines' requests since ruling on JetBlue and Spirit, its first two decisions on the CARES Act provisions. Delta was granted all of its waivers to begin seasonal service as planned in May and June instead of immediately, and Hawaiian Airlines was allowed to suspend all of its flights to the U.S. mainland except for Los Angeles (LAX) and San Francisco (SFO).
At the same time, United's argument that it be allowed to suspend service to small airports like Ithaca (ITH), New York, that are within driving distance of a large airport was denied. Ithaca is 60 miles, or about an hour-and-10 minute drive, from the Syracuse (SYR) airport.
U.S. airlines are in the midst of reporting their first quarter earnings with industry-wide losses expected. Even Southwest, which has never posted an annual loss in its 49-year history, reported its first quarterly pre-tax loss since 2009 during the three months ending in March. Financials for the second quarter, which includes April, May and June, are expected to be worse for all carriers.
Analysts expect the CARES Act payroll assistance to alleviate some of the immediate cash pressure on airlines. However, they also agree the industry will shrink — baring a miraculous recovery in demand — once the funds run out in the fall, forcing management teams to make difficult decisions about the future of their respective airlines.
Related: Is air travel on the rebound? TSA reports a week of passenger growth
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| 4X | Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year. |
| 4X | Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year. |
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You may be eligible for as high as 100,000 Membership Rewards® Points after spending $6,000 in eligible purchases on your new Card in your first 6 months of Membership. Welcome offers vary and you may not be eligible for an offer.As High As 100,000 points. Find Out Your Offer.Annual Fee
$325Recommended Credit
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Why We Chose It
There’s a lot to love about the Amex Gold. It’s a fan favorite thanks to its fantastic bonus-earning rates at restaurants worldwide and at U.S. supermarkets. If you’re hitting the skies soon, you’ll also earn bonus Membership Rewards points on travel. Paired with up to $120 in Uber Cash annually (for U.S. Uber rides or Uber Eats orders, card must be added to Uber app and you can redeem with any Amex card), up to $120 in annual dining statement credits to be used with eligible partners, an up to $84 Dunkin’ credit each year at U.S. Dunkin Donuts and an up to $100 Resy credit annually, there’s no reason that foodies shouldn’t add the Amex Gold to their wallet. These benefits alone are worth more than $400, which offsets the $325 annual fee on the Amex Gold card. Enrollment is required for select benefits.Pros
- 4 points per dollar spent on dining at restaurants worldwide and U.S. supermarkets (on the first $50,000 in purchases per calendar year; then 1 point per dollar spent thereafter and $25,000 in purchases per calendar year; then 1 point per dollar spent thereafter, respectively)
- 3 points per dollar spent on flights booked directly with the airline or with amextravel.com
- Packed with credits foodies will enjoy
- Solid welcome bonus
Cons
- Not as useful for those living outside the U.S.
- Some may have trouble using Uber and other dining credits
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $6,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
- Earn 2X Membership Rewards® points per dollar spent on prepaid hotels and other eligible purchases booked on AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- $120 Uber Cash on Gold: Add your Gold Card to your Uber account and get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an American Express Card for your transaction. That’s up to $120 Uber Cash annually. Plus, after using your Uber Cash, use your Card to earn 4X Membership Rewards® points for Uber Eats purchases made with restaurants or U.S. supermarkets. Point caps and terms apply.
- $84 Dunkin' Credit: With the $84 Dunkin' Credit, you can earn up to $7 in monthly statement credits after you enroll and pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment is required to receive this benefit.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
- $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
- Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.