Air- JetBlue Expects Deals Will Lower Maintenance Costs- Aviation Week

Posted: March 28, 2013 in Uncategorized

Mar. 27, 2013

JetBlue Airways, whose unit costs for maintenance rose nearly 70% from 2010 to 2012, expects to lower annual increases to about 5% in the next few years, thanks in part to flight-hour agreements and price caps on some of its heavy overhaul work, CFO Mark Powers says.

The airline still is negotiating a flight-hour deal with General Electric for maintenance, repair and overhaul of the CF34 engines on its Embraer 190 aircraft, Powers said in a presentation during the low-cost carrier’s recent Analyst Day.

The New York-based airline signed a memorandum of understanding last July to make GE its maintenance provider, but a JetBlue spokesman says the companies still are working on the commercial terms.

The MOU was for a 15-year OnPoint agreement, which GE says it tailors to the operational and financial needs of each customer. OnPoint services can include overhaul, on-wing support, new and used serviceable parts, component repair, technology upgrades, engine leasing, integrated systems support and diagnostics and integrated systems.

JetBlue’s maintenance costs increased from 50 cents per available seat mile to 61 cents in 2011 and 84 cents in 2012, in part because of the timing of MRO events; a large number of the airline’s Airbus A320 aircraft were delivered in the mid-2000s.


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