JetBlue Airways and United Airlines have reportedly been in talks about a potential partnership, according to three industry sources familiar with the matter. The New York-based airline is pursuing new collaborations after its Northeast Alliance (NEA) with American Airlines was blocked by a federal judge in 2023.

Unlike the NEA, which involved significant coordination between the two airlines, the proposed partnership with United is expected to be different in scope. While the alliance will focus on improving connectivity for passengers and offering opportunities to earn and redeem frequent-flier miles, the airlines are not planning to coordinate on schedules or pricing, the sources explained.

Details of the partnership are still being finalized, and the sources cautioned that the terms of the deal could change before a formal agreement is reached.

JetBlue President Hints at New Domestic Airline Partnership

In a recent earnings call, JetBlue’s President, Marty St. George, confirmed that the airline is negotiating with a domestic carrier that has a larger network. St. George indicated that an official announcement is expected within the current quarter, though he did not provide further details. In response to questions about the ongoing negotiations, a JetBlue spokesperson referred to St. George’s comments without adding new information.

For its part, United Airlines has declined to comment on the potential deal, labeling it as industry speculation.

JetBlue Struggles with Profitability and Investor Sentiment

JetBlue has faced significant challenges in its recovery since the COVID-19 pandemic, posting profits in only two out of the past nine quarters. The airline’s stock has dropped approximately 47% this year, reflecting growing concerns among investors. Short interest in the airline’s shares has surged by 35% since February, indicating increasing skepticism about its prospects.

The ongoing slump in travel demand, exacerbated by the economic uncertainty tied to President Donald Trump’s trade policies, has further complicated JetBlue’s financial situation. The airline also withdrew its 2025 financial outlook earlier this week, signaling additional concerns about its future performance.

Loyal Customer Programs as a Bright Spot

Despite the broader struggles, JetBlue is seeing some growth in its customer loyalty programs. Partnerships with other airlines are helping to drive this revenue stream, as they provide passengers with expanded connectivity options. These alliances remain a key area of focus for JetBlue as the company attempts to recover its financial footing.

American Airlines Lawsuit and Failed Negotiations

In addition to its talks with United, JetBlue had also explored a new partnership with American Airlines. However, the two airlines were unable to reach an agreement, and American Airlines has filed a lawsuit seeking damages following the collapse of the NEA. Steve Johnson, American’s vice chair, communicated the development to employees in a letter earlier this week.

Speculation Over JetBlue’s Future: Acquisition Possibility?

JetBlue’s declining market capitalization has sparked speculation that it could become a target for acquisition. In January, rumors circulated that United Airlines might be considering a bid for JetBlue. However, United was quick to clarify that it was not involved in any negotiations regarding a merger, acquisition, or similar strategic deal.

United’s CEO, Scott Kirby, acknowledged in an interview last month that while the airline is interested in expanding its presence in New York, particularly at JFK Airport, the regulatory challenges of acquiring an entire airline make such a deal complicated. Kirby expressed his reservations about the “headache” involved in acquiring another airline, highlighting the difficulties of navigating the associated regulatory hurdles.

United’s New York Expansion Ambitions

Despite the regulatory concerns, United remains keen on increasing its footprint in New York. CEO Scott Kirby had previously stated his desire to establish a stronger presence at JFK, but the complexity of acquiring another airline in order to achieve that goal has made the company hesitant. United is exploring ways to expand its operations without having to contend with the full regulatory burden of a merger or acquisition.