JetBlue to Defer Some Airbus Deliveries

The carrier will defer delivery of 21 Airbus A320 aircraft, taking them in 2014 and 2015, rather than from 2009 through 2011.
By Ted Reed ,

Updated from 9:10 a.m. EDT

The steep rise in fuel prices has brought a definitive end to rapid growth at

JetBlue

(JBLU) - Get Report

.

The carrier said Tuesday it will defer delivery of 21 Airbus A320 aircraft, taking them in 2014 and 2015, rather than from 2009 through 2011. Shares of JetBlue were losing 24 cents, or 5.4%, to $4.17 Wednesday.

While JetBlue has been slowing growth for several quarters, the latest announcement marked a milestone for a carrier that first showed the world it was a serious start-up in 1999, when it announced a $4 billion order for up to 75 new A320s. The first plane arrived that December and began flying in February 2000.

JetBlue has been growing ever since, although this year's fourth quarter will be the first quarter of negative growth in the airline's history. The quarter's 2.8% decline in capacity will mean a 2008 growth rate between 3% and 5%.

"In the face of escalating fuel costs, we believe it is essential to take a more financially conservative approach to managing our business," said CEO Dave Barger in a prepared statement. "The aircraft deferrals ... will help us further moderate our growth rate in 2009 and beyond."

Under its new schedule, JetBlue will still get three A320s in 2009, three in 2010 and five in 2011, as well as nine Embraer 190s in 2008, eight in 2010 and eight in 2011.

Also Tuesday,

AMR

(AMR)

, the parent of American, said that in September it will discontinue Chicago-Buenos Aires service and Boston-San Diego service, along with reducing its operations in San Juan, Puerto Rico. The carrier will also end Chicago-Honolulu service in January.

The changes are part of the plan by the largest U.S. carrier to cut consolidated fourth-quarter capacity by 7% to 8%.

UAL

(UAUA)

, the owner of United, and

Delta

(DAL) - Get Report

, the second- and third-largest airlines, have announced capacity cuts of 9% to 10% later in the year. Most other carriers have also set plans for capacity reductions or slower growth.

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