JetBlue Airways will be adding swanky, new premium seats on popular New York to California routes to keep loyal customers from flying other carriers, CEO Dave Barger told CNBC on Monday.
"We know that there are customers who are very loyal to JetBlue who weren't flying us ... from New York to San Francisco and LAX [Los Angeles International Airport] because of the lack of a premium product."
Starting next year, the all-coach, discount airline plans to offer 16 lie-flat seats on those flights, which are the most profitable and highly contested domestic markets for airlines, with first- and business-class tickets frequently selling for $4,000 round trip.
Barger said in a "Squawk Box" interview that passengers on these routes will "pay for that seat as opposed to being upgraded in the seat based on loyalty programs."
Long Island City, N.Y.-based JetBlue said the seats will debut on its new Airbus A321 planes in the second quarter of 2014. The planes will have 16 in the front cabin and 143 regular seats in the back. Four of the premium seats will have doors and are being marketed as "private suites" similar to what Dubai-based Emirates and Singapore Airlines offer their top customers.
The move earlier this month followed JetBlue's announcement of dismal second-quarter earnings, which fell by nearly one-third—missing Wall Street expectations—as maintenance and other costs climbed faster than revenue.
U.S. Airways and American's proposed merger
Barger said "it was a surprise … for sure" that the government wants to block the proposed merger of U.S. Airways and American Airlines, but it doesn't matter to JetBlue's business either way. He did add that "consolidation overall has been good for this [airline] industry."
For their part, U.S. Airways and American are asking for their day in court to fight the Justice Department's lawsuit seeking to prevent the deal.
Inspiration from an unlikely source
Barger and his JetBlue leadership team conducted their latest near monthly "officer huddle" meeting at the FDNY's fire academy on Randall's Island.
They took part in the FDNY Foundation's "Firefighter for a Day" program, which seeks to immerse executives in an innovative team-building experience with various scenarios firefighters face every day that require top-class teamwork, leadership and problem-solving.
"We're New York's hometown airline," Barger said, adding that he was inspired by the FDNY's leadership and collaboration abilities that are "necessary to fire-fight here across the five boroughs" of New York. He said his leadership team will be taking the lessons learned to the front lines of JetBlue.