Airline carrier jetBlue will “temporarily redeploy” inbound leisure flying from Puerto Rico to other destinations, as the island picks up the pieces after the devastation left behind by Hurricane María.
The information was confirmed Tuesday, when Puerto Rico’s largest carrier for the past several years, released earnings showing that Hurricanes Irma and María resulted in more than 2,500 canceled flights, or 3 percent of departures overall.
Financially, these storms reduced jetBlue’s earnings per share in the third quarter by $0.06 and the carrier expects ongoing recovery from both storms to reduce EPS in the fourth quarter by a further $0.10 to $0.13.
In the call, jetBlue CEO Robin Hayes said “leisure is an important part of our business, but the majority of traffic in Puerto Rico is VFR, or Visiting Friends and Relatives,” he said, which currently accounts for two-thirds of traffic to the island.
“We anticipate that VFR traffic will continue as Puerto Rico recovers over the coming months, similar to what we have experienced following other natural disasters. As a reminder, only 22 percent of our Latin capacity is to and from the Commonwealth of Puerto Rico,” he said.
Plans call for re-routing the reduced Puerto Rico flying to alternative leisure destinations until late 2018.
“The majority of the Caribbean, certainly when measured by available hotel rooms, is open for business, as is Florida,” Hayes said. “We have seen strong bookings as customers from New York and Boston rebook their travel to other destinations like Aruba, Grand Cayman, Barbados, to name just a few.”
“Based on past experience with natural disasters, we believe Puerto Rico resorts will be up and running for business. And leisure demand will shift back to the island by the end of 2018,” he said.
“We will also continue to watch booking trends closely and will adjust our plan as needed,” he added.
Meanwhile, Martin St. George, executive vice president, commercial and planning at jetBlue, said another issue under consideration is whether the carrier will return to the capacity it had out of Puerto Rico prior to the hurricanes.
“With respect to what the future size of Puerto Rico is, I think if you were to ask nominally, right now we’d all say we want to go back to where we were before the storm, if not more,” he said.
“But at the end of the day, we’re going to let the size of the market dictate the service we provide. I think it’s important to remind you that, we have been the largest carrier in the Commonwealth for quite a while. We have a very strong and a very profitable franchise down there and we want to make sure that we are there as Puerto Rico recovers,” St. George said.