Today Senior Contributor R.D. Sussmann-Dewberry returns with an editorial on the current state of United Airlines. He has previously written fantastic pieces about the modern rise of Delta, the new American Airlines, the History of Low Cost Carriers, the History of Air Shuttles, The Middle East 3, Alaska’s purchase of Virgin America, United’s Polaris and Slim Line Seats and the spread of Basic Economy fares. R.D. has been involved with the airline industry for over 20 years and is an active travel consultant and airline analyst. R.D. is also a huge #Avgeek, a theme park enthusiast and a friend.
United – A Troubled Carrier
An Air Transport World OpEd recently talked about the severely damaged brand image that is United Airlines; namely, looking at what does the name United have left in it – and should it be changed back to Continental. Personally, this is a very grey area – but one that merits some discussion.
First, I’ll admit: I’m a hard-core ExCon loyalist. I logged over 1,000,000 miles on CO from 2001-2010 prior to relocating to my current home. I knew Houston Intercontinental airport like th back of my own hand, and got to know quite a few people at the various stations I transited over that timeframe. The service was universally good, the attitude of the employees friendly & accommodating, and the product in both cabins was always something I was willing to pay for. I loved CO – and they loved my wallet, something that airlines for the most part have forgotten to do: Love is a two-way tarmac.
A Tired Airline
Now let’s look at today at the current UA: Not withstanding the current social media meltdown (I have taken a very neutral stance on it; leave it out of this discussion please.) the current image has been going steadily downhill despite the rollout of customer service initiatives and new products (Polaris, Premium Economy). In fact, before the previous week’s incidents, UA’s brand was looking as tired as ever.
Equipment refurbishment has been much slower than anticipated, and there are currently so many configurations out there that it is hard to figure out which part of the fleet has what on it. The new seating is still being refitted to existing aircraft, and even though the outside says “UNITED” the insides say “UNTIED.” While some areas have been shown to be improving (Returning snacks to the beverage service for example) other locations are still suffering mightily – and it is dragging down on the brand image.
The Competition Is Investing
Meanwhile, other carriers are investing heavily in the hard & soft product offerings; leading the pack is Delta – making flying more civilized for more people to more places. (Author’s note: I’ll be writing a piece on the changes in economy coming soon.) Addition of full meal service in economy on transcon services, widening the offerings on the PDE systems, and looking at improving the airport experience is differentiating the Delta brand from others.
Southwest is continuing to invest in a new-generation of interiors on their new-delivery planes which are not only more comfortable, but feature better design & more space for the passengers. And even American is turning their image slowly towards a more customer-centric model- though slower than WN & DL are.
Enough Blame To Go Around
And then there’s UA. A very tarnished brand hauling around a few black eyes and a nasty reputation for delivering the worst in customer service, attitude & experience. And depending on who you are, fingers point in all directions on who is to blame.
“It’s Smisek’s fault” – I would agree with some of this. While he is an Ex-Con, he is definitely NOT in the mold of Kellner or Bethune. He was a lawyer-accountant, and certainly had more in mind for cutting costs and penny-pinching in the wrong areas. And he failed the combined carrier in that respect: Where others put money into a merger/buyout, he did the opposite, squeezing nickels & dimes out of both carriers until his ouster 18 months ago.
“It’s the PMUA’s fault” – I would agree there too. A lot of the PMUA staff came in with a chip on their shoulder, an attitude problem that was long-reaching. Having a management staff who bred an atmosphere of mistrust & of animosity didn’t help the attitude at all, and having the rug pulled out from underneath them numerous times made it that much worse.
“It’s the management’s fault!” – This too is relevant. The early Smisek management team at UACO holdings began to make some disastrous moves namely in the mindset of cost reductions and in trying to keep the companies personalities intact. In any buyout/merger, the best aspects of each have to come together. In this case, the management team drove out both of those – and created a ‘new’ image that neither carrier really represented.
Reasonably speaking: It’s a blame game with only one true answer: LOOK IN A MIRROR. Everybody has been unhappy since this process started 7 years back in 2010. And it is everybody’s chance to share the blame in the failed outcome.
And now, you have an image that people resent. If given a choice, even with my status at United, I’ll still pay more for Delta or Southwest. Why? I get the two things frequent travelers both demand & expect when flying: Service & respect. I believe in both of these. And I expect we should always have them. Unfortunately, both of these have disappeared at the current United – and it shows.
The suggestion has been made that United needs to change their name back to Continental. And while I love the name, and I’m loyal to it – without completely flushing out the problems from the combined carrier, it would be a band-aid on a sucking chest wound.
How to Fix This Mess
So what to do? How to fix United’s predicament? And how to turn the carrier around? Here’s a short list:
1.) Remove the staff that do not want to be there. This is an easy first step, as it was done by Bethune years beforehand: Ask people if they really want to stay. Are they happy doing their job? Do they believe in the carrier? Are they willing to give 110% to customer service, no matter what is going on? Those who say no go. Replace them with newer, younger & more motivated staff who DO want to work there and build a unified carrier. Have the people who do want to stay help to breed a sense of pride & of passion in their jobs & in their carrier.
2.) Stop trying to turn the soft and hard product into a cheap excuse for lower prices. Yes, the ULCCs are impacting the network carriers – but you do not see the other carriers bending down to match their product and then raising the bar upwards for what you are willing to pay for. It is time to alter this perspective, and choose to do the right thing and the right product for the majority of your passengers. Yes, you’ll have your ULCC chasers for bargain basement fares -but your real bread & butter are those who are flying frequently and who are subsidizing the bottom-dweller passenger fares. Instead of giving them the same crappy product, up the game -and change how you’re charging for your bargain basement fares.
3.) Up the ante, and up the game: As Delta & Southwest have both been learning: PEOPLE PAY FOR GOOD SERVICE! While they are concentrating their efforts on making every passenger feel good and with better service, they are also getting premium pricing in many markets, and filling their planes at the same time. The same goes for the ME3, for many Asian carriers & quite a few European longhaul carriers: People will pay for good service. People will fly other carriers for bad service.
UA’s network, system & fleet are admirable. They have strong & very easily dependable hubs in key cities, and have good market coverage. However none of this matters unless they are able to get their image and their product under control and drastically improve them to compete with both domestic & global competition.
And after that, rename the carrier. Once you have a product that people want to buy, give it a name that means quality and service. The name United means neither anymore – and more than likely never will again. What are your thoughts?
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Slimesek is definitely to blame. I flew EWR-ORD quite a bit 2009-2011. I flew based on price and the fact EWR is so easy for me to get to. Otherwise I never would have flown them. My flights were all last flight out Friday/First out Sat and Mid morning Monday flights. I’m telling you we almost never arrived on-time. It got so bad, that I contacted United customer service after every flight I was delayed on. They started issuing me $75 and $150 vouchers for travel. I was given 5 of them. Yes, it was a nice gesture, but I would have much rather reached my destination on time. Looking back, I fell for Slimesek’s line of BS. “We are going to take the best parts of both airlines to create one truly great one” Yeah right. You fed that BS to me for two years and the merger dragged on and on. IT problems, operational issues, delays, you name it. That’s what you get when you name a penny pinching lawyer as the CEO of an airline. He had no idea what he was doing and it showed. It’s astounding he lasted as long as he did. Your analysis is quite accurate IMO. Slimesek just brought all those issues to a head.
I couldn’t agree more.
I flew DCA-PHX twice a month for seven years on CO – and under the Bethune/Kellner era the focus was on people. Smisek turned around & reversed every single course of duty they had instilled into the CO product, then turned around & plugged in all of the bad parts of the combined carrier into one ginormous pile of Steer Manure.
His departure left a gigantic smile on my face and a big ol “BYE FELICIA!” on my mind. On a personal note, his seat at the great table of airline leaders in hell has been engraved, right next to Wolf, Bedford, and Lorenzo.
hahha “people pay for good service” ?? explain DL’s excellent Trans-Pacific network out of JFK because all their HVF are so willing to pay for it.
I think their 19.2 cents premium yield per RASM over UA’s 12.2 cents answers your question.
The unions are a large part of the reason why United can’t get rid of those workers that basically are there to cash in a paycheck. (All airlines have this general problem). Southwest figured it out though, their employees seem happy enough.
Anyway, I am tired of the big three in America. I go out of my way not to fly them nowadays. It just isn’t worth it. On AA, Delta or United I run into FA’s who spend most of the flight sitting in the back just chatting with each other. Gate agents who don’t care. Customer service reps who are not very helpful on the phone. The list can go on for a while.
Flying Southwest, JetBlue, even Frontier and Spirit, I have had much better experiences and will gladly pay more for them now. Even if their seats are not comfortable or they try to nickle and dime me for everything. At least I know what to expect when I purchase a ULCC ticket.
I agree completely – though I have noticed over the past five years some really nice shifts at Delta in the area of Customer Service. While its’ still not what it once was (I’m ancient & remember the ‘good ol’ days’) it is getting better there.
Personally though I keep hoping for a return to what it once was at Continental: Great service, Respect & customer appeal. They may not have had the fanciness of in-seat video, but the planes were clean, the service respectable & reliable, and the people cared about their jobs. Nowadays, I find that pretty much on Southwest or Delta.
I haven’t flown Delta too much recently but their FA’s have been pretty good from what I remember, no idea if I have really interacted with the rest of their support staff.
Also, I don’t know if this is just me but seat back TV’s on United flights drive me nuts. The box that is needed for them take up so much room under the seat that I can barely get my book bag under the seat in front of me. Get rid of the TV and let me be able to put my bag down there. But maybe that’s just me!
Are we flying the same airline? It seems like we aren’t. I’ve had nothing but great experiences on UA (in over 500K miles in past 4 years). It was a little bit of a melt down during the merger, but they bounced back. I find that UA is investing more in their product, airplanes, internet, IFE, etc than most US carriers.
Granted I’ve run into my fair share of surly United FAs and GAs, but generally they are great. Much more pleasant than AA. When flying AA from BWI – HNL a few weeks ago, I swear I was in two planes straight out of the 70s. UA has flat beds on IAD-HNL route w/ a decent economy section. AA didn’t even have Wi-Fi…. AA is just now getting flat bed seats fleet wide (hello, 2000s). The list goes on.
My last four trips on UA have been from mediocre to just plain awful – and in a list of ways that nobody should ever experience. On one particular trip alone the airline dropped the ball in four separate areas: Not catering the plane on a 4 hour flight, running out of beverages on board, having two completely different configurations for the same plane type and the most egregious of them: Having a handicapped passenger have to WALK from mainline to Express as their ground staff were too busy to even arrange a cart or chair – despite being advised at reservations to do so. Surly ground staff along the way, and a lack of even caring about the passenger abounded – and left a very foul taste in my mouth.
Concerning the investment at UA – Compared to Delta & Southwest, UA isn’t spending nearly as much. Delta has invested (to date) nearly $2.1 billion in interior refurbs, cabin upgrades, and both the soft & hard product. Southwest is currently upgrading the fleet of new deliveries with a next-generation seat that is (from experience) a LOT more comfortable than the previous d(Evolve) seats, and is adding more space on board for future in-flight service improvements that have been hinted at over the past few years. UA, on the other hand, is simply trying to have an interior that looks alike based upon a decision made in 2010. While Polaris is a step forward for them in the front, the economy product is lagging a great deal, notably on longhaul, than others are – an area where they need to focus more of their future on.
As far as AA is concerned – they are slowly making progress in their transformation. I cannot speak entirely for them & their current plans – as they are still developing their future image – but the integration has been a lot slower due to the sheer size of the merged carrier. Though it has been 2 years now, the interior replacements are being upgraded as planes are added in (notably the Airbus 319 & 737s being delivered) while the retirement of their older fleet (MD-80s & early build 757/767s) which did not get their replacement interior.
As a Delta flyer almost exclusively, they’ve been quite good to me in myriad ways. However, given how much money they claim to spend on on aircraft interiors and retrofits they seem to undo much of that goodwill(and there is a lot!) by insisting on continuing to utilize those ancient MD88’s and feeder CRJ’s. I kinda get the CRJ’s as many cities are lucky to have any service at all, but the Mad Dogs are terrible. Duct tape, no power ports etc… Just archaic. I’m guessing they have a slow roll to get rid of these things.
The issues with the MD88s & CRJs have been addressed though at a slower pace. Right now, the plan is to use the new CS100/300 fleet to replace the MD88s, and to allow incremental growth of the larger regional jets, as well as the conversion of what have been CRJ cities to mainline. Realistically speaking, we’re just now seeing the airframe builders come to par with the needs of the mainline carriers as far as unified comfort & fleet that don’t feel like flying in a step backwards 20 years. It is one of the frustrating parts of analyzing this aspect of the industry as a whole: People now expect mainline service to feeder cities, and are no longer settling for the status quo of a regional jet. Where once we were thankful to get a jet on a short flight, expectations are higher 20 years on.
The MD88s are currently scheduled to exit the fleet by 2020, coinciding with the completion of the first batch of 75 CS100/300s into the fleet. At the same time, the CRJ200s will be long gone as well – with the smallest jet feeder being the CRJ700/E170/E175 network wide.
(On a personal note, I’ll miss the Mad Dogs myself, being a hard-core DC-9 fanboy of the WORST fashion. I grew up on those little buggers, and there’s nothing quite as romantic about aviation than vibration and noise. That’s me though – an airliner enthusiast with a passion for that type!)
“Those who say no go. Replace them with newer, younger & more motivated staff who DO want to work there and build a unified carrier.” Just like that? I’m sure the the Unions would say otherwise.
Sometimes you have to break some eggs to make a fine omelette.
Back in 1994/5, this is EXACTLY what Gordon Bethune did at Continental – and it worked miracles across the board. Those who didn’t want to stay, or were unhappy left – the rest who DID want to stay turned CO into the airline it was known for: Great service, reliable product & happy customers – not to mention profitable.
It is something that needs to happen. There are plenty of people there who wouldn’t be suitable for any customer service positions at a prison, let alone a carrier aiming for better.
Power to it. Just seems a lot harder than you make it sound. I assume some buyout package would need to be involved.
What’s funny is I like the service on pmUA better than pmCO. There are always bad apples on both sides.
Agreed on the bad apples – that’s been the case since Orville & Wilbur walked out to the sand dunes in 1903….
To refine a bit further on what Bethune & CO did:
At CO, they wanted to groom the carrier for growth, and needed to cut around 2000 jobs at the same time due to plane retirements. Instead of a mass layoff, they did the ranking system (as I mentioned above) and offered a severance package for those who volunteered for it. The ranking system allowed them to cut the part of the staff that were least likely to contribute to the turnaround, and in this case it worked beautifully. But it would be tough to do at UA – but not impossible. To do so would take an effort – but I think in the end it would be more than worth it to get some of the dead wood out of the picture – and to get the carrier’s functionality on par with the competitors.