Airline Fanatic

The NYTimes blog DealBook is reporting that Lufthansa is in talks to buy a 20% stake in JetBlue Airways.  I for one never expected JetBlue to be open to a sale, even for a portion of the company, to any airline, but it looks as if I’ve been proven wrong.  An official announcement on the deal could be made as soon as the market closes on Thursday in New York.

JetBlue’s stock, which has been in the dumps as of late, was up as much as 35% on the news of the potential deal to almost $8.50.  Why make this bid now?  DealBook indicated it was because of the relative strength of the Euro against the Dollar, making the deal cheaper than ever before for Lufthansa.  All of this still remains a rumor until an official announcement, but it seems quite possibly real to me.

Because Lufthansa is only taking a 20% stake in the company, they stay way below the foreign-ownership requirements for US airlines, something Virgin America has to battle when they started operations earlier this year.  According to people familiar with the matter the investment would only be a passive one, but would not rule out some kind of partnership (read:code sharing agreement) in the future. 

 Via [DealBook]

UPDATE: The AP has confirmed this story.  Lufthansa actually purchased a 19% stake in JetBlue for $300 million.  This is based on a share price of $7.27 per share, or a 16% premium of JetBlue’s closing price Wednesday.  Even more important, the two airlines said they would seek “an operation cooperation.”  What this means was not elaborated upon, but more details will be forthcoming.

The US is definitely behind the curve in this area, as several airline in Canada already let passengers check in using their cellphone. And lets not even talk about how far ahead Asia is in the cell phone department. Still, progress marches on, and the video below demonstrates testing currently going on that would allow passengers to use their cellphone to board a plane. The technology seems very convenient, but I’m wondering how long it would be before someone enterprising hacker figures out the algorithm and can generate boarding passes at will.

Virgin America continued its growth today with the announcement of new service to Seattle, WA (SEA) from its dual West coast focus cities of San Francisco (SFO) and Los Angeles (LAX).  Service from SFO starts March 18th, with follow on service from Los Angeles starting April 8th, 2008.  Fares on the route seem to be very competitve with flight between SFO and SEA starting at $77, and flights between LAX and SEA going from $99.  Even better, First Class seats on the two routes start at $177 and $199 each way, respectively.  For a three hour flight from LAX to SEA that is not too shabby a deal at all.

Sadly, this service starts after both of Virgin America’s promotion codes expire, so you will have pony up the full retail price in order to get on board.  I’m sure VA will come up with something new to give away before then though, and when they do I’ll be sure to let you know.

Boeing, speaking at their quarterly 787 program update, said today they see no further delays in production of the brand new 787 Dreamliner. A few months ago they informed the world that, like competitor Airbus, their new major model of aircraft would face a delay in delivery. So far that delay has only been six months, as opposed to Airbus’ two year delay, but the production schedule is still extremely tight. Many analysts expect Boeing to announce further delays, but so far executives are sticking to the revised schedule.

As things currently stand Boeing expects the first flight of the 787 to take place some time in the first quarter of next yea, with the first delivery model going to All Nippon Airways by the end of next year. All in all in 2008 Boeing still expects to produce 40 Dreamliners, with 109 rolling off production lines in 2009. Currently Boeing has a staggering 762 orders from 52 customers, which effectively means the plane is sold out through 2014. Now I just can’t wait to fly on this thing!

Engadget just took JetBlue Airways’ debut flight of BetaBlue, their free inflight wifi service, and has posted an in-depth look of their experience.  So far their story makes it seem like BetaBlue has a way to go before it becomes a truly useful service (unless you operate on Yahoo), but is a good first start.  Airline Fanatic wrote about this flight when JetBlue announced BetaBlue last week.

Maxjet Airways, one of the all-business transatlantic carriers trying to carve out their niche, requested that their shares stop trading on the London Stock Exchange today, pending the “clarification of its financial position.”  Yikes!  I’m no financial wizard, but when you ask for your stock to be suspended, it probably mean you are in a little bit of a financial pickle.

The numbers back this up, with Maxjet reporting major losses of $31.9 million during the first six months of this year.  For the full year 2006 Maxjet threw an amazing $79 million down the tubes, it was their first year of operation.  Most new airlines expect to make losses while they get their operations going and achieve some scale, but I doubt they expected to lose that much.

So what is their explanation for being so deep in the red?  From the Financial Times:

It has faced mounting losses in the face of surging fuel prices and lower than expected fare yields. Higher maintenance costs for its ageing fleet of Boeing 767 aircraft have also depressed financial performance.

Guess what guys, the rest of the world has had record fuel prices and aging fleets to deal with too.  It seems Maxjet may have overestimated the demand for discount business class service over the Atlantic, and are in big trouble because of it now.  If this were truly the case, you would think the rest of this category of airlines would be in trouble too.  Quite the contrary though, as Silverjet has just announced it will expand its current current fleet of 767s.

For the time being operations and reservations go on as normal while executives scramble to secure fresh financing.  I haven’t has the pleasure of trying Maxjet out myself yet, but here’s to hoping the airline will still be around when I do get that opportunity!

The Wall Street Journal is reporting that JetBlue is about to start testing their inflight wifi services with parterns Yahoo! and RIM.  For now at least the service will be completely free, and offer access to customized Yahoo Mail and instant messaging services.  People with wifi enabled Blackberries will also be able to access their corporate email and instant messages while inflight.    Best of all this service is starting almost immediately – with the first flight on December 11th.  The project, called BetaBlue, is only hooked up on one plane right now.  The first flight to get this feature will be flight 641 from JFK to SFO next Tuesday, but will shift thereafter depending on the normal schedule of the aircraft.  This is still a very limited test, so users will only be able to access the services mentioned above.

This test news puts JetBlue way ahead of other domestic carriers who are also in the market to install WiFi across their fleet.  Virgin America announced earlier this year they intend to use wifi on their entire fleet (though that is considerably easier than equipping JetBlue’s fleet).  JetBlue also said this testing will go on for months, so don’t get your hopes up too much for catching this first of a kind plane.  Either way, sooner or later JetBlue will be forced to open up BetaBlue to the entire internet.  The days of liveblogging my flights are upon us!