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JetBlue enters the basic economy battle with a ‘humane’ take on budget fares

(Washington Post illustration; iStock)

The battle for budget travelers just got a little more heated — and now, a low-cost carrier is in the mix.

On Tuesday, JetBlue rolled out its own version of “basic economy” airfare, joining most major carriers in the United States. The airline found itself under pressure from ultra-low-cost rivals like Spirit, Frontier and Allegiant, which charge low base prices and tack on fees for everything from seat selection to carry-on bags and snacks.

At the same time, larger traditional rivals such as American, Delta and United have introduced their own basic economy fares to compete better with the Spirits of the world. These tend to remove features that most customers are accustomed to, including choosing a seat in advance, making changes for a fee or, in some cases, bringing anything more than a personal item into the cabin. This group boards last, which means even if passengers are allowed to bring a carry-on, there might be nowhere in the overhead compartment to put the bag.

Enter JetBlue, which is trying to paint itself as the kinder, gentler basic economy option.

“Our new low fare will be anything but basic, designed to help customers save while still offering the full JetBlue experience,” president and chief operating officer Joanna Geraghty said in an announcement. “This will attract ultra-low-fare seekers to JetBlue, where we can take better care of them than other airlines do.”

Blue Basic, as JetBlue is calling it, will allow passengers to bring a carry-on bag and personal item — though overhead space could be at a premium, since they will board last. If they want to pick a seat in advance, travelers can pay an extra fee; otherwise, they can choose a seat when they check in 24 hours before a flight. Travelers still won’t be able to make any changes or get money back if they cancel their flight. The fares were being tested in certain markets Tuesday and will be offered across most of the network over the next couple of months.

A customer checks in at a kiosk at the JetBlue check in counter at the Richmond International Airport in Sandston, Va. (Steve Helber/AP)

Henry Harteveldt, a travel-industry analyst at Atmosphere Research Group, called the option to choose a seat for a fee and the allowance of a carry-on bag “minor differences” that could be better for travelers. And, he said, the flying experience on JetBlue will still have the amenities that fans admire.

“JetBlue does have more generous legroom, and once you’re on the plane, it’s the same onboard experience,” Harteveldt says. “You’re getting complimentary WiFi, TV channels, satellite radio, the blue chips and the Dunkin’ coffee and all that.”

The airline said in an announcement that it was “inspiring humanity in the ultra-low-cost and basic economy market” with its version of low prices.

But JetBlue spokesman Philip Stewart acknowledged in an email that the move was imperative from a business standpoint.

“With competitors now offering basic economy on many routes we fly, customer behavior suggests our success is at risk if we do not disrupt this market by lowering fares without sacrificing the experience,” he said.

When JetBlue signaled last year that it would enter the basic economy space, Geraghty said online comparison sites were encouraging more people to make decisions solely based on price, even if it wasn’t clear what the low prices would require travelers to give up. She said Tuesday the hope is that adding the new low fares will make the airline part of the “decision set” for people who just want the cheapest flight — and who then might be won over by the in-flight experience.

“We now have an additional tool in our toolbox to compete with the ultra-low-cost carriers and basic economy that we haven’t had before, but we believe that our take on it is far more humane and that you shouldn’t have to compromise service for low fares,” Geraghty says. “You should be able to have both.”

Since last year, Alaska Airlines and Hawaiian Airlines have both introduced their own lowest-priced options. Southwest, which doesn’t offer seat selection but allows passengers to check bags at no charge, is the only remaining major airline that doesn’t have a basic economy option now in the United States, Harteveldt said.

“I don’t know that JetBlue’s customers are demanding it,” Harteveldt says. “I think that JetBlue feels that they are losing market share and revenue to airlines that have it, and that this is a defensive move by the airline to reclaim customers that it feels should be traveling with JetBlue.”

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