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JetBlue rolls out cheap prices that have fewer benefits

JetBlue & # 39; s new Airbus A321neo at New York's Kennedy Airport.

Leslie Josephs | CNBC

JetBlue Airways on Tuesday joined other airlines to offer a basic economy fare: the cheapest tickets that do not have benefits as a pre-selection of seat. which was previously free in exchange for the lowest fares on a flight and is a defensive game against fast-growing, low-cost airlines like Spirit and Frontier.

Passengers who purchase the New York-based airline's basic economy fares will only be able to choose a location 24 hours before the flight and will also board the plane. Cancellations are not allowed.

When the airline announced its plan to offer the abolished prices last year, airline president Joanna Geraghty promised that customers who choose these prices "will agree to certain limits." She also promised not to make passengers feel like "second-class citizens." All passengers will still have access to free Wi-Fi and be able to carry a full-luggage bag and JetBlue has more legroom than other low-cost airlines.

The changes are part of a newly built ticket structure at JetBlue, the first low-cost airline's first since 201

5. The New York-based airline also replaces its Blue Flex prices with a ticket called Blue Extra, which combines a faster trip to the safety field, previously boarding and more ticket flexibility.

Geraghty said in an earnings call last month that it expects new ticket prices to bring in $ 150 million in revenue next year.

"We are pretty conservative in sales assumptions and taking the course," she said.

Executives at other carriers have said that their basic economy rates work because passengers are willing to pay a higher fare to avoid them.

JetBlue shares were unchanged in the premarket trade.

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