Originally Posted by Bluedriver

First we need to agree that JB wants and probably believes it needs a West coast presence to help it compete against the massive networks of the big 4.

Most vividly the company's willingness to spend nearly $4 billion just a few short years ago. Then they pledged to build it organically. They've been on record to shareholders as to pursuing additional gate space in LAX and SFO (largely failed so far). I know you also know they spent considerable time (too much wasted time) studying a SJC build up. I've heard other things, but will keep them private.

It's pretty clear they want a West coast network/presence.

How can Moxy create a West coast network when JB can't (won't)? The West coast isn't exactly lacking in competition. Alaska, SWA, Delta, UAL and AA all have large and well established West coast networks, to varying degrees. JB is a mature cost airline. Getting WC customers to leave their usual airline of choice and to fly on Jet-Who for the same fare price on a large scale would be extremely difficult. JB no longer has enough of a cost advantage to enter and win by lowering fares and stimulating demand, especially on the West coast where fares aren't very high due to competitive saturation. They know that, and it's the main reason they tried to buy a West coast network for $4 billion.

JB, as you know, is also a risk-averse company who likes moderate/slow growth in it's existing focus cities, in a predictable and deliberate fashion. They are also having margin/cost/Wall Street problems. Rapidly growing a new focus city out West using a loss-leader fare strategy with a mature airline CASM just isn't in the cards for JB.

Moxy, on the other hand, could enter the West coast at year 1 start-up costs, for the entire airline. Everything at year 1, using the LOWEST cost CASM aircraft on the planet. DN, being a serial successful airline start-up guy, for the right return on investment (an agreement to buy Moxy for a great price after 5-10 years) or himself possibly having a return to JB plan would be able and willing to fund this West coast Moxy start-up as a JB partner. This would relieve JB of the cost and margin killing problem of creating a West coast network via low-fare stimulation as well as not burden JB with the additional CAPEX this network would require. This also allows JB to concentrate on it's trans-atlantic aspirations. JB could never do both a trans-atlantic expansion and a West coast expansion simultaneously, as you well know.

In addition to year 1 costs and the A220 industry leading CASM/customer experience, DN/Moxy would also benefit greatly by being fed traffic from JB's well established East coast network. That's a big advantage, and allowed by the pilots unlimited domestic codeshare scope clause.

There are no prefect solutions for a West coast focus city available, so Moxy would likely have to hub at ONT, SJC, LAS, PHX, SAN and/or PDX. Those aren't LAX or SFO or SEA, but those gates aren't (probably not) available to anyone. So it would be a secondary airport strategy.

Don't misunderstand me, as others have done. I'm not saying Moxy replaces JB on BOS-SJC or similar. But JB might fly BOS-SJC and connect that customer onto Moxy to get to ABQ or IDA or GTF. In other words, Moxy would start an intra-west coast network fed, in-part, by connections from arriving JB aircraft into Moxy's focus city(cities).

Probably to eventually merge with JB after the West coast network is established via ultra-low start-up CASM.

Or DN is gathering capital as we speak to take JB private and combine his A220 orders into JB's.

Or the unlimited domestic codeshare is intended for an Alaska partnership (the company demanded unlimited domestic codeshare for SOMETHING, I promise you that much).

What I do know is that JB and DN ordered the same exact model aircraft, at virtually the exact same time, firmed up the orders at virtually the exact same time, and all of this happened exactly when the pilot contract/scope clause was finalized and at the same time the company probably knew what it wanted to do with Europe. And as stated, I don't believe what DN has told us about his plans for Moxy (Moxy could just as well be symbolic of his plan to take JB private again).

Long post, sorry.

All my opinion, of course.