Marty St. George Explains JetBlue's United Deal
United and JetBlue announced their new partnership on Thursday. I spoke to JetBlue's president about why his airline chose United.
Dear readers,
After the Northeast Alliance ended two years ago, JetBlue president Marty St. George began a search for a new domestic partner. Over time, St. George called at least one executive from nearly every U.S. airline, reading from a script for each call, presumably to ensure he would not botch a talking point or run afoul of regulators. Amazingly, even Delta's Glen Hauenstein — who probably has done more than anyone to thwart JetBlue's ambitions in New York and Boston — was on St. George’s list. It even included low-cost airline executives, though an agreement with Spirit or Frontier was very unlikely.
“Our view of the world was, let's cast the big net and see who shows interest," St. George said.
In a phone call with me on Thursday — not long after JetBlue and United announced their new agreement, called Blue Sky — St. George said he had been agnostic about JetBlue’s counterparty. It all came down to money, he told me, or more specifically the net present value of each airline’s offer. He said Hauenstein was cordial ("I had a very nice conversation”), but ultimately the two finalists were American and United.
I’ve written before that this partnership is a sweet victory for Scott Kirby, because it allows him to stick it to his former employer (and a top competitor) once again and it makes American even more irrelevant in New York. But on JetBlue’s side, St. George said that United only won because its offer was more lucrative than American’s, noting that it includes elements beyond earn-and-burn loyalty and interline. United will adopt Paisley, JetBlue's in-house vacation package platform, while JetBlue will be a customer for United's in-house advertising platform, Kinective Media, which United built for large brands seeking to target messages to an airline’s passengers.
Those extras "generated a lot of value" and made it "a broader partnership" than JetBlue might have had with another carrier, St. George said.
I learned a few other things from St. George during our discussion, including details about the JFK slots United is receiving, why this isn’t a codeshare agreement, whether JetBlue will expand at United hubs, and why JetBlue (unlike Ryanair) really likes the vacation package business.
Read on for details.