Jet Blue-DavidNeeleman

In 1999 he raised $130 million to start JetBlue Airways, basing it out of New York's JFK airport. In its first year of operations it was already making profits on its $100 million dollar revenues. By 2002 even with economic slow downs Neeleman was still able to increase revenues for the company to $635 million and turn a profit of $55 million, which is the highest ratio in the US airline industry. Neeleman is considered to be a genius entrepreneur by many people, as besides his great success with Jet Blue he has also succeeded in helping to build 2 other successful airlines (Morris Air, West Jet) and also a ticketless reservation system called Open Skies. A man with so many success stories makes you wonder how he got the motivation and the resources to become so successful. Many of these questions can be answered thr

In 2001 when Neeleman thought he had figured out how to fill the niche left empty by the large air carriers nothing could have prepared him for the events that occurred on 9/11. The company having many contracts on the line like meeting certain aircraft purchase dates and expanding to new destinations was putting everything in jeopardy. Yet Neeleman instead of canceling airplane orders and laying off employees he took a risk and ran the company on near schedule. He kept accepting orders on new planes where nearly every other airline was in a rush to shrink to save themselves from going bankrupt. And in the end JetBlue was still able to turn a profit while the industry as a whole was loosing billions of dollars. Another unpredictable force that was eating away at the airline industry was seen in the oil price increase. Most airlines have fuel costs raging from 25%-30% so fuel cost increases really affects the profitability of all airlines. JetBlue on the other had taken a chance by buying all brand new expensive yet efficient Airbus planes instead of the industry norm buying the much cheaper used Boeing 737’s. In the end Neeleman had reduced fuel costs to 15%, and ended up saving millions of dollars in fuel costs over his competitors.

Everything Neeleman has done successfully in his life concerning business he has done with the freedom to work independently without any rules governing what he can and can’t do in a company. The times were he was restricted by certain tasks like his top position at Southwest Neeleman failed. He couldn’t take the fact that he was desk-bound and became frustrated by meetings that seemed pointless. At one meeting after talking two hours about trying to solve a problems with what to do about pregnant ramp agents, Neeleman became aggravated and blurted out “Can't we just decide and move on?”. Things like this led to his dismissal from Southwest after only 5 months. After leaving from Southwest Neeleman new that he was an entrepreneur and he could never work again for someone else behind a desk.

Looking at his arrangement schemata he was in a very good position here after teaming up with June Morris and starting Morris Air. Through building the company Neeleman was able to learn many of the tricks and trade of the discount airline industry. He also made a great network of friends and business associates through Morris Air which set him up for many successes that he would have in the future like WestJet, Open Skies, and JetBlue.

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