JetBlue is poised to announce major organizational changes. The move, coming on the heels of a months-long business review, aims to streamline the structure, remove roadblocks and reduce spending according to an internal company memo. The message, sent to all crewmembers staffed at the company’s Long Island City headquarters (known internally as “LSC” for Long Island Support Center), asks that all “LSC Crewmembers to please be in the office on Friday (except frontline SOC not scheduled to work) to potentially participate in conversations about the plan.” The full text of the memo is below.
Many believe the reorganization will include moving a number of roles to the Orlando Support Center (OSC) campus where costs are lower. This idea is not new to the company. In 2010 it toyed with moving the headquarters out of the state completely. Ultimately it settled on a new office in Long Island City; that facility entered service in April 2012. That deal came with $30 million in tax benefits and other credits, including use of the I♥ NY advertising branding, against an estimated cost of $75mm to move headquarters to Orlando.
As the company has grown, however, the LSC office is more crowded and more expensive to maintain. As it focuses ever more on hitting “structural cost targets” changes must be made. What exactly they include will be revealed on Friday.
The memo indicates that both team meetings and individual conversations are on of the agenda for Friday. This suggests that headcount reduction are likely part of the plans.
It is almost certain that the HQ will not move wholesale from New York to Orlando. Slightly more likely is that some support roles will be shifted to the OSC campus. Crew Services, Dispatch and similar departments may find themselves relocated to Florida in the near future. But even that is a long shot at this point.
A shuffling of departments and head count reduction would likely achieve the cost savings without as dramatic an interruption to the operations. Better splitting core airline services and other departments such as marketing and loyalty could realize some gains as the company keeps pace with the changing competitive landscape. Operating the planes is still core to the company’s success but the digital transformation on the sales and marketing side must evolve much more rapidly to drive the desired successes.
The company declined to comment on any potential changes prior to informing its employees.