JetBlue looking for financing for 2010 deliveries

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JetBlue Airways has begun looking for financing to cover the three new aircraft it is now committed to adding in 2010 and could exercise options for additional 2010 deliveries.

Carrier chief executive officer Dave Barger says JetBlue has already secured financing for the nine aircraft it will take delivery of this year, but is still looking for financing for the three aircraft it is committed to taking next year.

"Of the 2010 deliveries, they are not financed. The treasury team is now in the marketplace," Barger said during today's Bank of America/Merrill Lynch transportation conference in New York.

While JetBlue is taking delivery of nine aircraft from Airbus and Embraer this year, giving it a fleet of 149 aircraft at the end of 2009, the carrier's capacity this year will actually be flat.

"We're still taking nine aircraft. We're just being smarter at how we utilise that," Barger says.

He adds JetBlue is flying less in the very early morning hours and less during the middle of the week.

While the current plan only includes three new aircraft next year, Barger says the carrier has the flexibility in its agreements with Airbus and Embraer to add more aircraft. He says if JetBlue sees the right opportunities the carrier would like to resume annual growth of at least 5% in 2010 and beyond.

JetBlue hold options with Airbus and Boeing to be able to expand its fleet to as many 350 aircraft by the end of 2015. JetBlue operates A320s and E-190s, and has a large outstanding order book for both types.

Barger says JetBlue will "look at opportunities" in both the domestic market and in Latin America and the Caribbean, where it has a fast expanding operation. But he says "every aircraft has to earn its right into the route network".

Even if growth resumes, Barger says do not expect JetBlue to again take delivery of a new aircraft every 10 days. Under its original fleet plan, JetBlue was to take delivery of 36 aircraft in 2009 and another 36 aircraft in 2010.

JetBlue has been able to reduce this by 27 aircraft in 2009 and 33 aircraft in 2010 through a mix of deferrals and new aircraft sales. The carrier has so far sold 17 A320s and two E-190s.

Barger says JetBlue now only plans to spend about $300 million on new aircraft capital expenditure this year, down from over $600 million in 2007 and 2008 and over $1 billion in 2005 and 2006.