JetBlue Wins Spirit’s LaGuardia Slots—After Saying It Can’t Make Money At The Airport

JetBlue is the high bidder for Spirit Airlines slots that allow for up to 12 daily flights at congested New York LaGuardia airport. They bid $58.5 million, beating Frontier which bid $57.5 million for 12 daily departures and 10 arrivals. There were 5 other, lower bidders as well. The airport authority insists that the winning bidder also lease the Marine Air Terminal, which Spirit Airlines abandoned. That appears to be JetBlue’s plan, and could make offering service from the airport more economical. Final approval could come by August 5, though closing could stretch to late October. The transfer will require FAA approval and the terminal negotiations. When Spirit Airlines valued its assets for liquidation, they listed these LaGuardia slots as worth $86.746 million, so JetBlue’s bid is about 33% below that appraisal. It’s not just that the slots are worth less – the FAA Administrator said that if they didn’t go to a low fare carrier, that the agency could just retire them. That created regulatory uncertainty which reduced the value of competitive bidding. The challenge for JetBlue is that the airport is so expensive that their CEO says they can’t make money there. According to Joanna Geraghty, It is incredibly expensive to operate out of LaGuardia, so much so that we had 50 flights at one point, and we have 13 now. Now, most of the 50-to-13 decline came from the end of the Northeast Alliance and American reclaiming the slots it had supplied to JetBlue. However, JetBlue did eliminate five routes and reduce three more in 2024, and later abandoned New York LaGuardia – Boston saying the economics no longer worked. And JetBlue is flying their best routes from the airport. More slots means more marginal routes. JetBlue reports that the airport costs them over $40 per passenger. I have to wonder if a move to the Marine Air Terminal will get them lower costs that help operating economics at the margin. Frontier most certainly thought that it would, or else they wouldn’t have bid so aggressively. So what could JetBlue be thinking here? This is a once in a generation opportunity. Large blocks of New York airport slots almost never become available. JetBlue grows from 31 to 53 individual slots, a 71% increase in a single shot, although it will still only control about 4.6% of New York LaGuardia. Lower their cost base with the Marine Air Terminal. Moving both the existing 13 departures and up to 12 new ones to Spirit’s six-gate facility could spread station and lease costs over roughly 25 departures and eliminate JetBlue’s Terminal B allocation. They’re getting too good a deal to pass up. Bryan Bedford’s position that the slots have to go to low cost competitors likely capped the price, so they’re winning at a better price than the slots would normally trade for. Lease or re-sell some slots later. If the plan doesn’t work, there’s probably a good market to offload the slots themselves (though perhaps not the terminal real estate). Here are the 22 slot times: No. Slot Time (ET) Operation Days of Operation 1 0600 Departure All 2 0630 Departure All 3 0730 Arrival All 4 0830 Departure All 5 0900 Arrival All 6 0930 Departure All 7 1000 Arrival All 8 1030 Departure All 9 1100 Arrival All 10 1130 Departure All 11 1200 Arrival All 12 1230 Departure All 13 1400 Arrival All 14 1530 Arrival All 15 1530 Departure All 16 1630 Departure All 17 1730 Arrival All 18 1830 Departure All 19 1900 Arrival All 20 1930 Arrival All 21 1930 Departure All 22 2030 Departure All Customers, of course, wouldn’t find themselves in the new Central Terminal – with its water feature and American Express, Chase, and Capital One lounges. Isn’t there an antitrust problem with all this, though? When JetBlue was buying Spirit Airlines outright, they did a deal with Frontier to divest Spirit’s New York LaGuardia slots and gates – they saw Spirit’s LaGuardia flights as an antitrust problem that could block the deal. Of course, things have changed in two ways. First, they’re no longer eliminating a competitor at New York LaGuardia – Spirit Airlines has already ceased operations. And second, the Trump administration’s stance on antitrust is likely to be very different than what was experienced during the Biden administration. United Airlines CEO Scott Kirby even pitched the President on his carrier acquiring American Airlines! Topics on this page