The Wall Street Journal-20080201-JetBlue and Aer Lingus to Set Partnership

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JetBlue and Aer Lingus to Set Partnership

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Low-fare carriers JetBlue Airways Corp. of the U.S. and Ireland's Aer Lingus Group PLC is expected today to announce a strategic partnership aimed at boosting traffic but that could test the limits of their bare-bones business models.

When the plan goes into effect -- flights will be available for sale April 3 for travel later that month -- European and American passengers will be able to book linked flights between Ireland and more than 40 U.S. destinations in single reservations, connecting through JetBlue's home base at New York's John F. Kennedy International Airport.

The alliance is unusual because budget airlines generally shun cooperation with other carriers. Traditional airlines routinely use such tie-ups to increase the number of destinations they can offer and thereby appeal to more travelers. But interweaving airlines' networks and sharing ticket revenue through what airlines call "code sharing" is complex and can be expensive to manage.

JetBlue and Aer Lingus say they are avoiding those costs and management headaches because their partnership is primarily based on connecting their Web sites.

"This is totally new," said JetBlue Chief Executive Dave Barger. "It's electronically linking two carriers." He said he hopes the partnership will pave the way for JetBlue to team up with other non- U.S. airlines.

Enda Corneille, corporate-affairs director at Aer Lingus, said connecting the two carriers is straightforward because both handle most of their reservations using simple Web-based systems, as opposed to the elaborate computer-reservation systems employed by other airlines. Rather than establishing new multiairline fares, as carriers have long done, the duo's systems will simply add the cost of two flights that could be booked separately.

"The accounting of this is a cinch," Mr. Corneille said. He said both carriers expect to generate additional revenue from the linkup, but "we haven't put a figure on it."

For JetBlue, which took wing in 2000, the partnership offers an opportunity to leverage its domestic network, attract more non- American passengers and offer Ireland to its U.S. customers. Serving 53 cities in the U.S. and Caribbean with 550 daily flights, it is the eighth-largest U.S. carrier by traffic.

Dublin-based Aer Lingus sees the deal as a way to offer many more U.S. destinations to its customers than the seven it serves itself. Once a lumbering government-owned carrier, Aer Lingus earlier this decade transformed itself into a low-cost, low-fare airline, disentangled itself from a mass of marketing agreements with other carriers and went public in 2006.

Last month, Deutsche Lufthansa AG bought 19% of JetBlue's shares and said it was looking at ways to develop commercial relations. Mr. Barger said Lufthansa was apprised of JetBlue's plans with Aer Lingus; he doesn't see the Irish connection impeding future commercial cooperation between JetBlue and Lufthansa.

The new service will use a booking tool on the Irish airline's Web site, to which JetBlue's Web site will link. With one payment, customers will be able to buy a flight from Dublin to, say, Fort Lauderdale, Fla., via New York, or vice versa. The carriers hope later to include JetBlue's flights to the Caribbean and Aer Lingus's flights around Europe from Ireland.

After arriving in New York on an Aer Lingus flight and clearing customs, passengers connecting to a domestic JetBlue flight can drop their luggage at Aer Lingus's transfer desk in the arrivals lobby and take a free train to JetBlue's terminal. Many of JetBlue's passengers arriving from Europe already do this, but in two discrete steps.

The carrier said "dozens" of foreign carriers serving Kennedy had talked about opportunities to tap into the U.S. airline's domestic route network. Mr. Barger said JetBlue chose to work with Aer Lingus because they share a philosophy of offering low-priced one-way fares and because Aer Lingus is the only European discount carrier now offering scheduled flights to the U.S.