A higher-than-expected number of General Electric CF34 overhauls for JetBlue's Embraer 190 aircraft continued to cause higher maintenance expenses for the carrier in the fourth quarter, however cost per available seat mile (CASM) for maintenance grew at a slower rate than in the first three quarters of 2013.
The airline's expenses for maintenance, repairs and materials increased 23.3% to $98 million in the fourth quarter, compared to the same three months of 2012. Full-year maintenance expenses increased 28% to $432 million in 2013 compared to 2012, the carrier reports.
Maintenance CASM grew about 14% in the fourth quarter, or a slower rate than the 20% or more seen in the first three quarters of 2013. The airline's CASM increased 0.6% in the fourth quarter to 7.3 cents. Full-year CASM increased 3.8% to 7.25 cents.
When combined with the year-over-year impact of Hurricane Sandy, the maintenance costs negatively impacted JetBlue's 2013 operating income by nearly $50 million, says JetBlue chief executive Dave Barger.
“We expect maintenance cost pressures to ease in 2014,” says JetBlue's chief financial officer Mark Powers on a 29 January call with analysts.
JetBlue has entered into flight hour maintenance agreements to mitigate the unexpected maintenance costs, says Barger.
Source: Cirium Dashboard
