Beyond Boeing: Airbus delivery delays to eat into JetBlue’s growth

Earnings

A JetBlue Airways Corp. Airbus A321 plane sits at a gate outside of Terminal 5 at John F. Kennedy International Airport (JFK) in New York, U.S., on Wednesday, July 12, 2017. Jetblue Airways Corp. is scheduled to release earnings figures on July 25. Photographer: Mark Kauzlarich/Bloomberg via Getty Images

Mark Kauzlarich | Bloomberg | Getty Images

JetBlue Airways recently received unwelcome news from Airbus: Its planes are delayed.

The New York-based airline on Tuesday more than halved its expected deliveries of new Airbus A321neo planes this year to no more than six from 13 as delays hit the European manufacturer.

“We’re very disappointed with the continued delays to our A321neo program as a result of the Airbus production issues including a further delay that we’ve received in the last 1.5 weeks,” JetBlue’s CEO Robin Hayes told analysts on a call after reporting higher-than-expected profits for the second-quarter.

Those delays will shave about 2 percentage points off of JetBlue’s growth plans for next year, JetBlue said in a filing. Flying without those fuel-efficient planes could also drive up costs, it added. The carrier plans to expand its capacity by 3% to 5% in the third quarter “which is unusually low for JetBlue,” president and COO Joanna Geraghty said.

Airbus did not immediately return a request for comment but JetBlue’s Hayes said

The delivery problems show constraints on airlines that don’t even fly the Boeing 737 Max, which has been grounded worldwide after two fatal crashes, are facing as they scramble to meet strong demand.

JetBlue’s competitors, including United, Southwest and American, are all challenged by the grounding of the 737 Max, another fuel-efficient narrow-body plane that competes directly with Airbus’s A320 family of planes. Those airlines have canceled thousands of flights through November, and regulators have not said when the planes will be cleared to fly again.

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