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JetBlue cost cuts hit New York headquarters

JetBlue Airways is reshuffling staff at its New York headquarters as part of a larger effort to reign in costs across the carrier.

The changes impact around at least one sixth of the roughly 1,200 employees at JetBlue's Long Island City headquarters, FlightGlobal understands. The changes include both involuntary role changes, as well as a combination of layoffs and voluntary departures.

The restructuring is being relayed to employees today.

The changes are "culturally significant", as a source describes it, to JetBlue, which has not undergone an organisational restructuring on this scale since it began flying in 2000.

"To streamline how we work, we are moving certain teams and roles into new reporting structures and are eliminating a number of positions," JetBlue tells FlightGlobal. "We need to make these difficult decisions to ensure we are set up for success."

The airline adds that has it worked to reduce the number of layoffs by offering "voluntary buy outs and by eliminating a number of open positions". It declines to comment on the number of staff impacted.

In December 2016, JetBlue kicked off a programme to reduce operating costs by up to $300 million by 2020. The airline aims to keep unit costs (CASM) excluding fuel growth in check, at flat to up 1% compounded annually over the period, as part of the plan.

"We've outperformed on unit revenue," said Jim Leddy, then interim chief financial officer and treasurer at JetBlue, at the time. "But on costs, it's a different story."

The carrier aims to reduce "corporate" expenses by up to $90 million as part of the larger cost reduction programme, a January presentation shows.

JetBlue faces pressure from Wall Street to keep expenses in check. JP Morgan analysts downgraded the carrier's stock to neutral in April, citing concerns with rising costs.

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