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American, JetBlue Join to Expand Service in Northeast

American and JetBlue are increasing flights in the Northeast and also agreed to codesharing.
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Shares of American Airlines  (AAL) - Get Free Report and JetBlue Airways  (JBLU) - Get Free Report fell Thursday after the two airlines announced a partnership that will permit them to sell seats on each other’s planes, boosting their presence in the New York City area and Boston.

The airline business has been decimated by the coronavirus pandemic, which has kept potential travelers at home. American notified 25,000 of its employees this week that they are at risk of losing their jobs later this year.

The agreement allows American to launch international service from New York’s JFK airport to Tel Aviv (TLV) and Athens (ATH). In addition, JFK to Rio De Janeiro (GIG) will return as a daily seasonal route in winter 2021.

JetBlue will also add flights at New York City’s LaGuardia (LGA) and Newark’s airport (EWR). It will also increase its presence at JFK for connections to American’s expanded international network.

JetBlue plans to enhance service to important markets on the East Coast, West Coast and in the Southeast.

JetBlue and American will operate reciprocal codeshare flights. “JetBlue will gain connectivity to more U.S. destinations, a broad global network and an improved frequent flyer proposition,” the company said.

“Pairing JetBlue’s domestic network with American’s international route map creates a new competitive choice in the Northeast, where customers are longing for an alternative to the dominant network carriers,” said JetBlue president Joanna Geraghty.

American President Robert Isom said, “This is an incredible opportunity for both of our airlines.”

American shares recently traded at $12.55, down 6.62%, and have plunged 56% year to date. JetBlue shares recently traded at $11.17, down 3.29%, and have dropped 40% year to date.