Fares Increase and Routes Expand as Airlines See Leisure Demand Grow

JetBlue Airways said Wednesday it will start transatlantic service late this summer, competing against bigger rivals on the lucrative route between New York and London.

The New York-based airline said it will start daily flights between JFK and Heathrow airports on Aug. 11, and add daily trips from JFK to London's second-biggest airport, Gatwick, on Sept. 29. It plans to add Boston-London flights next year.

JetBlue wanted to start the flights earlier than mid-August but was delayed, partly by the process of proving to regulators that it could operate long over-water flights safely. The late launch means JetBlue will miss most of the peak summer-travel vacation season. However, travel between the United States and the United Kingdom is still restricted because of the coronavirus pandemic, and it's not clear when restrictions will be eased.

"Given that the U.K. remains closed, we didn't feel a ton of pressure to open earlier in the summer," JetBlue President Joanna Geraghty said in an interview. "This gives us a couple more months. We are pretty optimistic that by then things will be ready to go."

Before the pandemic, New York-London was among the most lucrative and highly competitive airline routes on the globe. It was popular with high-fare corporate travelers moving between two great financial hubs.

JetBlue believes it can undercut other airlines on price by using fuel-efficient and smaller, single-aisle Airbus jets with 117 economy seats and 24 lie-flat seats in a premium service that it calls Mint.

JetBlue said fares will start at $599 in economy and $1,979 in Mint. The latter is several hundred dollars cheaper than mid-August business-class fares displayed on Google Flights for rivals such as American Airlines, British Airways and Icelandair. New entrants frequently offer deals when they start on new routes. Sometimes the bargains go away quickly.

JetBlue wants to offer more flights but found it difficult to break into Heathrow, where takeoff and landing slots are hard to get. The daily JFK-Heathrow flight will arrive in London after 10 a.m., which is later than many business travelers like.

"The times are not what we would have preferred," Geraghty said, "but we also think they are times that are very workable for a large number of customers."

JetBlue is looking next at expanding into continental Europe, where it would run into more competition from American, Delta and United. Among the cities being considered are Paris and Amsterdam, Geraghty said.

In other airline news, Southwest Airlines said Wednesday that bookings are improving and leisure-travel fares for June are approaching prepandemic levels, further signs that the airline industry is recovering from a deep slump.

The Dallas-based airline said the average April flight was 79 percent full, and it expects June flights to be 85 percent full. Southwest said it has sold 55 percent of the seats it expects to fill in June and 35 percent for July, which it called "fairly typical" booking patterns.

Southwest said in a regulatory filing that demand is still being driven mostly by leisure travelers. It said bookings by business travelers are ticking modestly higher but remain down about 80 percent from 2019 levels.

The carrier added that operating revenue in April was 42 percent below April 2019. It forecast that the revenue decline compared with two years ago will narrow to between 20 percent and 25 percent by June.

The airline said it cut its "core" cash-burn rate to $6 million a day in April and now expects to lose between $1 million and $3 million a day in the April-through-June quarter. That is $1 million better than a previous forecast. It expects to reach break-even in June, excluding debt service, capital spending and some other costs.

The shares were down 2 percent in early trading about an hour before Wednesday's regular session.