Consultants: JetBlue Was Right to Stay on the Ground
JetBlue Airways took a high-profile black eye on St. Valentine's Day, when icy conditions led to its passengers being trapped on the tarmac for up to 11 hours. With the sudden return of wintry weather, the discounter played it safe -- by canceling 400 of 550 scheduled flights on Friday. Did the move signify panic -- and should investors be concerned? A master of damage control and an aviation analyst weighed in, on "Power Lunch."
Besides JetBlue, US Airways, Delta Air Lines and American Airlines acted pre-emptively by nixing flights on Friday; CNBC's Sue Herera asked Eric Dezenhall to rate the performance of airlines overall this weekend. The founder of damage-control consultancy Dezenhall Resources graded the industry a "B": he said that the "great sin" in a crisis is giving people no control -- and said the airlines as a whole acted fast and informed fliers fairly well.
Dezenhall opined that "good companies recover from brand damage," but he slammed US Airways, whose problems lay with "their systems, not Mother Nature." He observed that "no one cares" about a firm's problems -- consumers just want results.
Michael Boyd, president and aviation analyst at The Boyd Group, said that JetBlue did much better in the long run to cancel flights early, leaving ticketholders "at home in Nassau and the Bronx." It'd be much worse to risk tabloid coverage of fliers stranded at airports, with "pathos and little children crying." As for the overall state of the industry, the former American Airlines employee warned that, "30 years ago, you had me to help you. Now, you have a computer kiosk." And in a crisis, Boyd noted, a kiosk can't help you.