The head of JetBlue Airways Corp. said Tuesday the low-cost carrier expects to boost its noncore revenue by 60 percent this year, in part by charging passengers extra for more legroom.
"What we want ... is the ability to upsell," Chief Executive David Barger said.
Speaking at an investment conference in New York, Barger said "demand is solid across the JetBlue network," and he assured analysts the carrier is "in the middle of a momentum story," in spite of industrywide worries of a slumping economy and sharply rising fuel prices.
Like a number of its competitors, JetBlue's share price was pummeled in recent weeks as crude oil prices surged to all-time highs. Tough competition has made it difficult for domestic airlines to raise fares fast enough to keep pace with rising fuel costs, leaving carriers scrambling to find additional cost savings and new sources of revenue.
Delta Air Lines Inc. earlier in the day announced plans to shed 2,000 frontline, administrative and management jobs through voluntary severance payouts and other initiatives.
Barger said JetBlue, based in Forest Hills, N.Y., soon expects to roll out a program called "even more legroom" that will offer passengers in the first few rows and emergency exit seats of its larger aircraft additional space for an added fee. A spokeswoman declined to provide details of the plan, but Barger made it clear the single-class carrier is not planning to start offering business-class service.
"We're not going to a two-cabin airplane," he said.
A recent deal the carrier's LiveTV subsidiary struck to operate its in-flight entertainment system on new Continental Airlines Inc. aircraft should also help boost JetBlue's ancillary revenue numbers, Barger said.
Last year, JetBlue reported $2.84 billion in sales as it posted its first full-year profit in three years. Nonpassenger revenue accounted for $206 million of the total.
Barger also said the company expects to sell four more of its older A320 planes, bringing to nine the total heading out the door this year. JetBlue expects to take delivery of 12 new A320s and six smaller Embraer 190 aircraft in 2008.
Barger offered few details about efforts to bring the airline closer to German carrier Lufthansa AG, which took a 19 percent stake in JetBlue in January. Teams on both sides of the Atlantic are working to develop commercial and supply-chain partnerships, he said.
One proposal might be to link the two carriers' online booking systems, as JetBlue plans to do with Irish carrier Aer Lingus Group PLC beginning next month, Barger suggested.
"We're very open to different types of partnerships and opportunities," he said.