JetBlue Dumps CEO

JetBlue Airways Corp. replaced founder David Neeleman as CEO less than three months after operating snafus essentially shut down the carrier for days and frayed relations with customers.

The low-fare airline on Thursday appointed Chief Operating Officer Dave Barger as its new chief executive, effective immediately. Neeleman had been chief executive since 1998 and will retain his role as chairman.

The move comes after storms on Valentine's Day and St. Patrick's Day essentially shut JetBlue down, forcing the cancellation of nearly 1,700 flights and stranding thousands of travelers throughout the Northeast.

To prevent a recurrence, JetBlue drafted a "customer bill of rights," the gist of which is that the company now issues vouchers to some customers who experience delays.

The canceled flights and vouchers cost JetBlue $41 million, contributing to the company's first quarter loss of $22 million, or 12 cents a share. That was an improvement over the year-ago quarter, but was less than analysts had originally expected.

Last month, JetBlue lowered expectations for the rest of the year.

In a statement, Neeleman characterized the change as "a natural evolution" of JetBlue's leadership structure.

Barger, 49, will retain his role as president. He joined JetBlue as president and chief operating officer shortly after Neeleman founded the airline in 1998.

Shares of the airline, which operates more than 575 flights daily to 52 destinations, jumped 54 cents, or 5.1 percent, to $10.94 in morning trading. The stock is off 35 percent since mid-January, when it hit an intraday high of $17.02.

[klonghurst]

David Neeleman is an outstanding individual, a person who is customer oriented and a great example of a family man. Even if in the long term this is a good move for all involved it is a sad day to see this change for such a great entrepreneur. David, I wish you all the best.

[germanmom]

Bad move, JetBlue. David Neeleman is a stand-up guy; a rare breed. Even if you end up being a smaller company, you could be a quality company.

[pennhr]

On April 26, my 6:50 pm Jet Blue from Chicago to JFK was delayed to 8:50 and then to 10:50. Knowing it would not take off on time, and not wanting to arive in NYC at 4 or 5 am in the morning, I called JB to cancel. First, I was to be charged a cancellation fee of $30. Noting that I had freed a seat possibly to be resold, I said I would not pay it. JB relented. Second, I was willing to book a JB flight for the next day. I was told the one way fare was $230. I had already determined that the fare to LaGuardia on ATA was $174. JB did not relent on this, although it had open seats. So JB earned $0.00 on an unoccupied seat on that flight, rather than some number under $174 and, very likely, this passenger for good. ATA took off a few minutes late, but touched down at LGA a few minute early. (In the interest of full disclosure, I have no connection to ATA.) Bad thinking, JetBlue.

[pennhr]

On April 26, my 6:50 pm Jet Blue from Chicago to JFK was delayed to 8:50 and then to 10:50. Knowing it would not take off on time, and not wanting to arive in NYC at 4 or 5 am in the morning, I called JB to cancel. First, I was to be charged a cancellation fee of $30. Noting that I had freed a seat possibly to be resold, I said I would not pay it. JB relented. Second, I was willing to book a JB flight for the next day. I was told the one way fare was $230. I had already determined that the fare to LaGuardia on ATA was $174. JB did not relent on this, although it had open seats. So JB earned $0.00 on an unoccupied seat on that flight, rather than some number under $174 and, very likely, this passenger for good. ATA took off a few minutes late, but touched down at LGA a few minute early. (In the interest of full disclosure, I have no connection to ATA.) Bad thinking, JetBlue.

[niahartman]

I was so enthralled by the JetBlue CEO when he broke the "never apologize" rule. It is the ultimate political/business rule that has brought our country to the fall of its Roman-like empire and made "our" multi-national companies despised throughout the world and thus made the USA a terrorist target. When an individual makes a mistake, the proper response is to apologize, make amends, and assure that it can not happen again because of positive changes made. JetBlue did the absolute right thing. I have used the company as a role model for teaching my own children. My friends and I all gained a deeper respect for an already loved company. Now, the bubble is popped. Will the new management apologize for the mistake of this ouster?

[lochlan-2009]

Is it me or does this sound like one of the sub stories in Meet Joe Black where that snake like businessman tries to steal the media business from Hopkins.

[antoniof123]

Another slave to Wall Street when will people learn that it is Wall street that is causing so many of our problems. Big business and Big Religion but a cancer on our world I say take away all tax breaks and let us go back to before Regan destroyed the old tax code in fact maybe we should go back to around the tax code of the 1950's. I think if there was talk of that many large corps and wealthy people would start to wake up and do the right things.

[bjpo-2009]

Agree with comments above - couldn't say it any better!

[braniff77]

We finally have an airline CEO who is willing to shoulder blame, make apologies to customers, work alongside the rank-and-file employees, and not take millions of dollars that should go to the workers, and they get rid of him. So now Jet Blue will be just like all the others whose management cares more about their pensions than their employees and customers.

[sevenveils]

And the delays were the CEO's fault because?