United Airlines Needs to Clean House

At United Continental Holdings (NYSE: UAL  ) , it's clear that the buck stops nowhere. Last week, the struggling U.S. legacy carrier reported a huge adjusted loss of $489 million for Q1. Meanwhile, its top competitors -- including Delta Air Lines (NYSE: DAL  ) and American Airlines (NASDAQ: AAL  ) -- each earned hundreds of millions of dollars.

United executives rolled out a new wave of excuses to explain away both the poor Q1 performance and weak guidance for Q2. To some extent, I'm sure they are right that overlapping systems from United and Continental, high growth by other carriers in Asia, and the pilot shortage at regional airlines are causing big headaches.

United Airlines has come up with lots of excuses for its terrible performance.

However, at some point, the management team has to be held accountable for performance. United Continental is already two years past the biggest integration milestones, yet it continues to lose ground vis-a-vis every other major airline. It's time for the Board of Directors to step up and replace all of United's top executives and see if a new management team can do better.

Falling behind -- way behind
In early 2012, just over a year after the United-Continental merger closed, the integration process seemed to be in fairly good shape. United reported a solid $1.3 billion pre-tax profit for 2011, driven primarily by a 9.2% unit revenue increase: the best among the legacy carriers.

Since then, United's relative performance within the airline industry has declined rapidly. Last year, United's pre-tax adjusted profit totaled $1.1 billion: down about $200 million from 2011. In the same span of time, Delta Air Lines improved its pre-tax adjusted profit from $1.2 billion to a stunning $2.7 billion. Analysts now expect Delta to earn nearly $4 billion this year before taxes.

Delta Air Lines is on pace to post pre-tax earnings of nearly $4 billion this year.

American Airlines has also reported steady margin growth recently, and it improved its Q1 pre-tax margin by 3.6 percentage points. The company appears to be well-positioned for strong margin growth through the rest of 2014, too. American is projecting a 4%-6% increase in unit revenue for Q2.

Meanwhile, United is still floundering. The company's Q2 guidance calls for a meager 1%-3% unit revenue increase, with a large chunk of that gain attributable to the calendar shift of Easter from Q1 to Q2 this year. That would produce very modest profit improvement for United this quarter.

It's not getting better
As I have written previously, most airline analysts have been far too kind to United Continental in the past year or so. With the airline industry showing rapid profit growth, many analysts have assumed that United is bound to follow the rising tide. However, based on the combative tone of United's recent conference call, it appears that even formerly strident bulls are having second thoughts about United.

Most of the initiatives that United executives have raised as "fixes" for its unit revenue problems are very minor in nature. For example, United is optimizing its revenue management system, working to boost ancillary revenue, changing flight schedules in Houston and Denver, more actively matching aircraft size to demand, and cutting some flights in Tokyo.

However, United faces significant structural problems that will get worse -- not better -- as time goes on. First, United's hub in Newark is one of the company's crown jewels, but the recent Delta-Virgin Atlantic joint venture has left United as a distant third in the New York-London market: the most important international business travel market.

American Airlines is expanding in Asia, putting pressure on United. (Photo: American Airlines.)

Second, competitors like American and Delta are working to close the gap with United for Asia service. Both airlines are starting two new U.S.-Asia flights in June. Combined with the long-term growth trajectory of several Chinese airlines, this will keep up the pressure on United's transpacific routes.

Third, United's highly profitable transcontinental routes from JFK Airport in New York to Los Angeles and San Francisco are about to get a whole lot more competitive. All things considered, Q2 could very well be the easiest quarter of the year for United -- yet it will still post subpar results.

Time for some pink slips
The airline industry is a cyclical business, and it's pretty clear that we are approaching the high point of the cycle. Industry conditions are about as favorable today as they ever have been, yet United is still barely profitable, with a pre-tax margin of less than 3% for the last 12 months. In a year or two, the industry "tide" will probably start flowing the other way, dramatically ratcheting up the pressure on United's earnings.

Airline integrations are tough, and the United management team may have been dealt a bad hand in terms of other headwinds like route-specific competitive capacity increases.

However, the fact remains that United's management team isn't getting the job done. By now, United should be gaining ground on the rest of the industry in terms of margin performance. Instead, it is falling even further behind.

With several airlines having merged in the last few years, there are plenty of experienced airline executives who are out of the industry right now. It's time to give another group of leaders a chance to run United Airlines. It would be hard for them to do any worse than the current management team.

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  • Report this Comment On April 26, 2014, at 2:49 PM, AAfool wrote:

    United's problems can be solely attributed to no one but Jeff Smisek, a bean counter not an airline man. Continental had a huge identity crisis before merging with United, and its attitude and thinking has destroyed United Airlines. Business First, which replaced true First Class on the transcon route, is a joke. The only gain was the ability to cram more rows of coach seats on the 757's dedicated to the service. Also less staff on board required since you now have one less cabin. Customer service has gone downhill as well, since Smisek is only interested in the mighty dollar. I was extremely loyal to the old United, but this one you can keep. A warmed over Continental which I avoided at all costs. And the mindset is everywhere. The less anyone does the better. Filthy aircraft, border line food, mostly over or undercooked, and lots of aircraft on long flights with no entertainment system at all. American owns the transcon market right now, and has far superior service as well. Better food, friendlier more helpful staff both at airports and in the air, and a far superior attitude. And yes the competition is heating up United. JetBlue offering mint, and Delta refurbishing the transcon 757. I hear Bob Crandall is available United, and airline man who was loved and respected by all, not a bean counter. Someone they should consider..

  • Report this Comment On April 26, 2014, at 6:32 PM, airlineinsider wrote:

    The greatest challenge United is facing is a lack of leadership and credibility both internally and externally. This deficit is directly attributable to the head of the management team, Jeff Smisek. If you were to ask the employees of United- "Is anyone capable of turning this around, and actually inspiring and motivating the UAL employees so that United's full potential can be realized?", I think that the same names would likely be heard again and again. The one's that come to mind for me are (in order): 1-John Edwardson. Forced out by union squabble at BOD, but an incredible leader who was highly respected and admired by nearly everyone he came into contact with at both United and CDW. If he could be convinced to take the job and name his team to support him, I believe most would be amazed at the margin and return United could achieve. 2-Sean Donahue. Former VP Operations (and most other divisions) before CEO at Virgin Australia and now CEO of DFW Airport. Very insightful and knows United like very few others. Also someone who has immense credibility with line employees, because he made the tough decisions to do the right things. 2- Greg Brenneman Former COO of CAL and CEO of Burger King. The brains and talent behind Bethune's miraculous turnaround of CAL.

    One of the greatest strengths for UAL is also one of their greatest challenges (that is obviously not being managed well right now). The fact that UAL has multiple large hubs to create a vast domestic and international network is very valuable. It can also be a big liability because when weather events strike multiple hubs it is more challenging to manage those events. More accurately it is more difficult to communicate the continually changing recovery plan(s) to 50K employees at once in real time.

  • Report this Comment On April 26, 2014, at 6:52 PM, 24copper wrote:

    If United wants to get it's only true "frontline" employees (past stories have reported that due to technology, as many as 60% of all passengers only ever have contact with a flight attendant) seriously and highly motivated, they need to do a 60 day massive effort to settle the Flight Attendant joint contract between sUA and sCO and merge it's seniority list between the two so we can all move on. There are probably at least 1K FA's on the sCO side who want to get a "buy-out" and leave the company. Please give it to them. Those people have no real desire to come to work. I think you would see on board service levels improve if United were to accomplish this in 60 days, including a rapid vote.

  • Report this Comment On April 26, 2014, at 8:09 PM, RockIsland wrote:

    I love how people are trying to hang this whole thing on Continental ( we are the ones that are bring plan aircraft have state of the art entertainment system located in every seat, United had * CRT located down the middle of the aisle, Continental has lie down seats in businesses first , United had the old 1980 United down) The facts are that as a airline we were making money before the merger, United was not, our transcontinental first class seats, for this airline to survive they need to start dumping the sub-UA managements and get back to the org. businesses

  • Report this Comment On April 26, 2014, at 10:36 PM, Denica56 wrote:

    I miss Continental.....very professional and, quite frankly, a money maker. United - a bunch of whiney people who forgot how to turn a profit. Old planes and a bunch of spoiled rotten brats who demand more and more just to bleed the company dry. Management - losing this much $$$$ - don't even think about a bonus. Let's pull together - have pride in the company and offer the best service and see what happens.

  • Report this Comment On April 27, 2014, at 3:11 AM, exconVince77 wrote:

    Continental was profitable before the merger and I said at the time, that all CAL had to do was wait two years and they could buy out UA after their next bankruptcy. The only problem CAL had at the time was Jeff Smisek. He insisted on merging one of the world's most admired airlines with one of the world's worst. Instead of raising UA up, it dragged CAL down. I am convinced that Jeff Smisek couldn't run a 7-11 Store, much less an airline. My only dealing with Jeff Smisek was before he was CEO, and he came across as arrogant, self-centered and self-entitled. If the board gets rid of him and his so-called team they will improve the airline, greatly.

  • Report this Comment On April 27, 2014, at 3:32 AM, thomaslyons wrote:

    Bring Gordon Bethune back!!

  • Report this Comment On April 27, 2014, at 6:36 AM, magilagorilla wrote:

    United's problem is treating their customers like crap. Everybody has a horror story about rude, condescending, and outright hostile employees at United ruining a vacation. I will never fly them unless they are literally the only carrier that serves the city I am traveling to.

  • Report this Comment On April 27, 2014, at 6:39 AM, mills18 wrote:

    United has ruined the great Continental. An airline that used to have the friendliest staff and no problems flying in/out of Newark which was their main hub.

    United has many options to redeem itself, and I have offered free advice and services time after time. They need to be the first US airline to go completely Business/First. Cater to just the business traveler and older customers who have money. Keep children under 12 away. Keep family and once a year vacation travel off the airline. Keep coach out all together.

    And for the love of god. Upgrade your planes. It's 2014, there should not be a single plane on the sky today that doesn't have high speed wifi, tv OnDemand and Sirius/XM satellite on board. Food needs improvement. The kitchen behind the meals offered on board should be ashamed. Shrimp Salad anyone?!?!? Oh yeah, it's practically on every damn flight. And finally the stewardess that are all United hold overs are some of the rudest people on this planet. Especially to customers in their 30s who fly business/ first. They have issues with people who have money. Tons of resentment. Not the way your best customers should be treated.

  • Report this Comment On April 27, 2014, at 8:36 AM, AAfool wrote:

    Continental was nothing to write Aunt Milly about. It went through bankruptcy 3 times, and raped and destroyed Eastern Airlines under that darling Frank Lorenzo. Yes they served food until the merger in coach, but cheeseburgers are hardly anything of substance other than to kids. Business First is so so. As I said earlier, just a way to cram yet more coach seats on an aircraft. American is getting it right. Its long haul fleet is state of the art, and has the most comfortable seating in all classes. United has yanked 767's off the Hawaii route, and is now flying some 737's. Why not just fly RJ's to Hawaii ?? No one in their right mind wants to sit on a 737 for 5.5 hours. And the meals served in Business to Mexico, are stuff leftover from Continental. No thank you. And filthy aircraft as well. And replacing staff at check in with Kiosks is not exactly customer friendly. And a fleet that makes little or no sense. Airbus, Boeing, and both Pratt and Whitney and Rolls Royce. The 737-700's really should be parked and replaced. Uncomfortable and not fuel efficient at all. As for customer service ?? Get rid of the higher ups in charge, axe some of the customer service reps to set an example, and you might actually be on to something. But that won't happen any time soon, since we are more focused on raising baggage fees and add yet more rows of coach seats....

  • Report this Comment On April 27, 2014, at 8:58 AM, Eliot41 wrote:

    The New United has done many things well.Spending money on facilities, adding WiFi to 30 planes per month, new seats,and new hangers. Improving the infrastructure for the future. It's IT and implementation of IT is a disaster .It does not consider the needs of its customers, Flying transcon with no video and power outlets for a year as it transitions to customer tablet only video content on the a320 and 737-900 is unacceptable, When the airline begins to put its customers first and empowers its employees to put the customers first,it might succeed. Until then Smizek and team need to learn they are not as smart as they think they are. Delta will continue to eat their lunch.

  • Report this Comment On April 27, 2014, at 10:07 AM, GeorgeBabbitt wrote:

    United is discovering once again one of the most sage pieces of management philosophy ever espoused during the Gordon Bethune era: Don't let bankers and lawyers run your company. When The CO Board brought Bethune to the property, Continental was a near-mortally wounded airline suffering at the hands of quick-fixes and lame strategic moves like Cal Lite, all brought on by the Finance Corp that was squatting at the top of the dung heap at the time. The current United bears a remarkable resemblance to the Continental of 20 years ago, with spreadsheet management and BYA (Bright Young Analysts) making product and operational decisions. Bethune himself is a character from the past and too old and too comfortable to come back to the grind and fix the operation and product, but United certainly needs a leader (a whole set of top leaders) who has been in the trenches, who knows what it means to deliver the product the company sells, who knows how to motivate employees, and who doesn't consult the latest RASM and Yield reports to made decisions that he thinks will keep employees and customers happy. The airlines are still a service business, and service businesses need managers who understand how the service works, not how to prepare an SEC filing.

    And quite frankly, bringing back Greg Brenneman as has been suggested here, would be no better, and perhaps worse.

    Wherever the Board goes for its answer, I hope it isn't at a top law firm or a McKinsey-esque consulting cabal.

  • Report this Comment On April 27, 2014, at 10:17 AM, GeorgeBabbitt wrote:

    Let me further add an anecdote of Leadership that I personally witnessed in Continental's Bethune days.

    Early in Gordon's tenure, Continental still had airplanes in all sorts of paint jobs due to the previous years' amalgamation of carriers and equipment. In a weekly Operations meeting one January, Gordon directed to the Maintenance group: "I want all the airplanes painted in Continental livery by July". Gordon understood intuitively that this broken airline needed to get an identify for itself, or its employees and customers would continue to see it as a fragmented disaster. The Maintenance folks nodded their heads and went away.

    At the following week's Ops meeting, the Maintenance planners came back with all sorts of charts and graphs and planning documents showing how it would not be possible to get all the airplanes painted by July due to the hangar plans, schedule requirements, and of course, the budget. Gordon listened very carefully to all their arguments for why it couldn't be done, and when they were finished, he said, "Okay, I want all the airplanes painted in Continental livery by July." And that was it. The Maintenance planners figured out a way to do it, and we got painted airplanes, even at the expense of pulling down some flying and reserve aircraft in order to be able to do it.

    The point to the story isn't to glorify Bethune; rather, to show that a solid leader understands when things have to be done that don't fit the spreadsheet analysis. If you're going to lead a company, you have to know how to lead.

  • Report this Comment On April 27, 2014, at 10:22 AM, 777770 wrote:

    As a former United Mechanic, and now a stockholder , I got layed off after 18 years during the merger , I now work on-call maintenance on all mainline A/C . I see the differences between United and Contenental operations and I can say that The United operation is light years ahead of Continental. The problem is during the merger Continentals management is taking over United operations and totally screwing it up. Its time to let United run the operation ,they may have not been perfect, but they are a hell of a lot better than who is running it now !

  • Report this Comment On April 27, 2014, at 10:44 AM, TMFGemHunter wrote:

    Thanks for the comments everybody.

    Pretty much anyone you ask will have some suggestion for what United should be doing better. But if you ask 10 different people, you'll probably get 10 different answers, which shows how hard some of these problems are.

    The only thing that's clear is that what United has been doing so far is not working. I don't see any prospect of a miraculous turnaround if the current management team gets just one more year to tinker around. The company needs new leadership and a new strategy.


  • Report this Comment On April 27, 2014, at 4:52 PM, djducky73 wrote:

    My brother works for United, and even he can't figure out what they are thinking!!! The spend millions on an add campaign to bring back United customers, but then chase them away by replacing already full flights with smaller planes, and canceling flights that are always full. Even some of our routes make no sense. For example, from LAX to Manila, Delta offers service from LAX-NRT-MNL using 747s with in seat entertainment. With United, you must go from LAX-HNL-GUM-MNL, on mostly 737-800 planes, or 777 with no in seat entertainment. Delta has nice refurbished 747s that are now being used more, while United is pulling its 747s. Granted, the 787 is a great plane, but its much smaller than a 777, and once again, those passengers are going to other airlines and finding those airlines are better. Also, United is the largest airlines at LAX, but its terminals are the worst, and United does not consider LAX a hub.

  • Report this Comment On April 27, 2014, at 4:55 PM, TMFGemHunter wrote:

    @GeorgeBabbitt: That is a great Gordon Bethune story!


  • Report this Comment On April 27, 2014, at 5:02 PM, TMFGemHunter wrote:

    @djducky73: United isn't getting rid of any 747s for a while, and it actually has more 747s than Delta. However, it is moving some of its 747s from the West Coast to Chicago (and possibly also Newark) so there probably are fewer at LAX.

    On the Manila example, the two situations aren't quite comparable. United has a joint venture with ANA, so it can also connect customers through Narita. It doesn't make any difference if it's a United plane or an ANA plane flying NRT-MNL because of the joint venture arrangement. (United can also connect passengers to Manila with Asiana in Seoul.) Delta doesn't have a joint venture partner in Japan, so it needs to provide its own connections in Tokyo.

    By the way, I am pretty sure that United does consider LAX a hub.


  • Report this Comment On April 27, 2014, at 5:19 PM, tessflying wrote:

    Everyone on the front line is upset. Reservation jobs are being moved to the Philippines where service is either terrible or they give the store away just not to get in trouble for a bad survey. Numbers are more important than customers. Airport jobs are being outsourced to other companies. The flight crews still fight over being United or Continental. The pilots make a ton of money but they want more. Wages at the top, starting with the worst CEO ever are as high as they can be and wages at the bottom getting lower and lower. Union dues for a union that only protects those that do a bad job. When Gordon Bethune ran Continental the employees were willing to do anything for him. United has had problems for many years and the merger ruined a perfectly wonderful company, Continental. But, with Jeff taking over way before the merger, who is to say that Continental would not be the horrible airline United has become since Jeff would have been on the helm. A agree, good housecleaning is needed. Some upper management people dont know a thing about the departments they are running. It is time to make changes. I own stock and I'm so tempted to sell.

  • Report this Comment On April 27, 2014, at 9:22 PM, markjbzn wrote:

    Airline merger's are tough, no matter who the players are. But there are some points that need to be made:

    First, several folks have written that CAL basically "saved" UAL????? Your CEO, Jeff Smisek, stated in front of a senate panel, "The best we can expect, is a "hand to mouth" existence", in other words, survival was very questionable. Whether or not you have any respect for your CEO (and I don't), this is what he told the Senate committee. So, unless this was a complete lie, CAL didn't have the money to "buy" United, nor did it save us.

    Second, the small airline mentality that CAL brought to the table, has been one of the worst things that could have happened to a major, world wide carrier, i.e. sUAL. We had three times the wide body aircraft and an international route structure that made sense. We had aircraft on routes that could actually fly the route, fully loaded, all the cargo and passengers and we didn't have to make fuel stops.

    Third, the CAL software and IT capability was far worse then ours. UAL's wasn't industry leading at all, but everything we've had forced upon us by CAL, is archaic. This has led to unexpected mass cancellations by SHARES and an inability to track aircrews during irregular operations. All have led to higher costs and unhappy passengers.

    There are countless other examples, but the gist of this article is exactly on target. We need new management as well as a new board of directors. Without this, we will at best, fulfill Smisek's prediction of operating on a "hand to mouth existence.....pretty sad.

  • Report this Comment On April 28, 2014, at 12:44 AM, BMEP wrote:

    Markjbzn should study the SEC filings to see who bought whom- he'll be disappointed.

    That's all sewer water under the bridge now.

    The pink slips started quietly going out a few months ago and will continue, hopefully not too late. The BOD is to blame for delaying the departure of some fat lazy upper management.

    The old bitchy flying leathernecks of the United airlines flight attendant staff will have to go as well.

    United is like a big slow ship and turning it will take time. It did start late in the game, but hopefully not too late. It needs to trim down, and lose the attitude. It has a good route system and if it hadn't lost some of the better CAL mgt to Delta, they would be better of than.

    IT is a disaster- the "We are an IT company with wings is an internal joke". Changes clearly have to be made there for the integrity of the operation. Let's see a year from now where United is vis American.

  • Report this Comment On April 28, 2014, at 7:55 AM, Eliot41 wrote:

    United has many issues. As Adam stated " If you ask 10 different people, you'll probably get 10 different answers". Far down on the list is " the old bitchy flying leathernecks of the United airlines flight attendant staff" who would be happy to go if "WE" were bought out. Richard Ferris tried to fire the pilots and flight attendants in 1985. Instead, he was fired and we are still here today. The resentment of our seniority is just one of the many issues of merging two different cultures. If United was well run, we wouldn't be talking about any of this.

  • Report this Comment On April 28, 2014, at 9:57 AM, upintheair98 wrote:


    Yes United has major issues going on, but I beg to differ with you, this is all "Continental's" fault. As a front line employee of this airline, I can't tell you how many times I get on an aircraft after 2+ yrs of this merger, that I get the comment " you must be former Continental". I'm speaking for myself only, I still come to work with a smile on my face and treat every customer with the same respect I would hope I would be given. We are good people trying to do the best job given the circumstances. All I am saying to you, there is blame on both sides. United was NOT a happy airline before this merger, Continental WAS! We are trying on the inflight side to turn this around!!! I'm sorry you have been on horrible flights.....but not all flights are horrible! Come fly on my flight, and I guarantee you will leave happy! Happy Flying!!

  • Report this Comment On April 28, 2014, at 11:43 AM, Cvh wrote:

    I know nothing about the problems of the merger, other than to say as a frequent traveller overseas, I have experienced all of the larger airlines,and seen the rise and fall of many of them.

    As long haul flights go Continental was light years ahead of the pack,I witnessed Delta airlines,under Mullins go from the top to the bottom. United was always nothing more than a also ran, never paying attention to the customers priorities.

    Airline travel today can be likened to nothing more than dreary bus travel, which I unfortunately have to endure.

  • Report this Comment On April 28, 2014, at 4:20 PM, AAfool wrote:


    One person alone, does not make an entire Airline. I see your enthusiasm and dedication share that with all others in the company. One great flight will not make up for horrid experiences from the time you arrive at the airport until you deplane. Newark is a nightmare compared to JFK. All of United's flights just have to leave within 60 seconds of each other, creating a parking lot on taxiways. There never seems to be such nonsense even at DFW. American and Delta also don't let anything and everything board with First Class like United. Pay the $75 fee and gain priority access. Not fun trying to stow your carry on when the coach people allowed to board early, start slamming into you and complaining on the 737's and Airbus aircraft. Both other majors only allow first and elite travelers to board first, and wait 5 minutes before opening the cattle chute. And Americans planes are properly staffed as well. All the things the old United did, but got away from under Smisek. And Americans frequent flyer program is still the best in the air. Sorry, no astronomical fees attached to booking a free ticket and more seat availability too. I avoided Continental because the hubs were stupid, and limited widebody flights to the cities I traveled to. United owned California, and a connection there was far easier than in Houston or Cleveland. If I do fly United, I look for actual United aircraft anything ending in UA. I will get a UA crew and most know me, but since the new United is bent on parking most of Uniteds fleet, rare for that to happen any more. Sorry to day, not all mergers work are for the better........

  • Report this Comment On April 28, 2014, at 7:18 PM, airlinelost wrote:

    Everyone makes good points about who is running the company. being with the United for over 25+ years and living through parents and grandparents, I have heard and seen the good and bad stories of Execs. From the Ferris and Wolf regime of its my way or the door, to William "Pat" Patterson who was concerned about employees. Jeff falls somewhere in the middle. he is not airline person, but a lawyer and reports to the Stock Holders, its all about the dollar. The real problem is you have different ways to run a company the UA way and the CO way and they are not meshing. We need a John Edwardson like person that can unite people at the basics, we all work here and need to succeed. There is no loyalty, as someone said its being run by BYAs. Their idea is that a 5% yearly attrition rate is to low it needs to 10%, so to get that cut benefits, cut wages, remove pay increase, remove bonuses for all but the top and see if you can get employees to quit. Then make comments at Performance Seminars, that if you have more than 7 years with a company that you uncreative, unmotivated and stale and need to move on. So, they want a company that makes a fast buck and move on before it bites you in the backside. Then they should start at the top as most have been there for than 7 years. Lets make a change at the top. For the most part the employees on the front line and those at non-airport locations are good, just getting bad guidance. People are right, 737's on long hauls is not good, yes you make more money when its based on RASM. They take delivery of almost 2 to 3 a month, the 787 a couple of year. There are no new widebodies coming in the near term. Every other Airline is passing United up by equipping its employees with the Tools and Technologies to do their job better. There is only one true hub at United and its Houston. Maybe Wall Street and United Customer's need to stand at the Gate of United and demanded the change to leadership.

  • Report this Comment On April 28, 2014, at 8:39 PM, mikel wrote:

    For all you who claim Continental saved United you need to do some research. . You are clueless. Continental was considered a distressed carrier by many Analysts pre merger. Look it up. (seekingalpha website) Continental had approx 1 billion in the bank. No where near enough to survive the Winter, while United brought 9 billion to the table.

    As far as the whining about United ruined Continental, HALLO, who is running the show. Everyone from the CEO down the the last VP is from Continental or was hired after the merger by the current leadership. So if the airline is going down it's because of the current leadership in place.

    The department I work for under United had ONE manager for <100 employees. After the merger for the same amount of people in the same department we now have 1 Managing Director, 1 Senior Manager, 3 Managers and a dozen supervisors. The Continental Culture what a bunch of BS, as far as I can tell we treat our customers only slightly better then we treat the employees. I am not talking about the front line employees but the people who decided that having >60% of your flights on United Express (RJ's) is a great Business Plan.

    The Board of Directors must be asleep at the Yoke to let this continue.

  • Report this Comment On April 28, 2014, at 8:47 PM, TMFGemHunter wrote:

    I don't think you can blame United's issue on its aircraft. Every single one of the top 4 U.S. carriers has lots of 737s.

    If I had to suggest one major fix for United, it would be following Delta's lead by replacing most of its small regional jets with 76-seaters and small mainline planes. United has the flexibility to do this based on its pilot contract, but doesn't seem to have figured out a way to operate small mainline aircraft profitably.

    To give one ludicrous example, United uses valuable slots in Newark flying 50 seat jets (and in some cases 37 seat jets!) to fairly large cities like Milwaukee and Kansas City. How can you not stimulate enough demand in those cities to fill a small mainline plane for a flight to New York where you can also offer connections to dozens of cities in Europe? Not to mention the fact that basically any plane would be an improvement over the E135/E145 from a product standpoint.


  • Report this Comment On April 29, 2014, at 7:44 PM, reximus wrote:

    I just sent this open letter to UAL's CSR. It's worth a shot, but I'm not holding my breath.

    re: Last Straw

    I've had it with UA. I've been a loyal customer and have put up with the changes and the promised improvements. Although there have been marginal improvements in service, overall, there is no appreciation for loyalty.

    1) I will be another one of those who complains about moving the goal posts, despite being a long-loyal UA customer. Why have all these stipulations and “milestones” for customers have to PROVE their loyalty? What's next? Onboard spending minimum? Luggage spending minimum?

    2) I recently tried to upgrade myself on flight from LAX to HKG and paid $600 AND 30,000 in miles. In any other airline, that would have automatically put me in a better seat. Instead, I was still shown to be the bottom rung in your classification of customers and kept getting bumped DOWN by other customers, ultimately not getting the upgrade. And this is despite paying $600 and 30K in miles. The price paid for vapor.

    3) On the flight back from HKG, I get water spilled on me by the FA and very little apology was given except “I'll get you new blanket”. I was given a new blanket to replace my soaked one. Thanks for the sincere apology.

    4) I called the UA CSR to check about the refund of my upgrade and miles. When we started, she was trying hard to show thankfulness for me being a Silver customer–wow. By the end of the conversation, the CSR just about yawned when I was trying to share my grievances about the broken upgrade process. She just showed me that UA does not care about the customer service Jeff Smisek keeps chanting. It's easy to talk, actions prove it. I was shown that my money isn't worth it to UA.

    The fact of the matter is that customers like me, who have been painfully loyal to UA throughout all the changes in the past 5 years, aren't seen as valuable to UA. Yes, I get it, there are often higher revving customers who spend $200K+/year, but for those of us who are up and coming and increasing miles this year and the future, our loyalties are being challenged and left to choose other airlines that TRULY APPRECIATE their member's business.

    I do hope that this letter does not vaporize into the void of supposed customer service. My question is “I wonder if my loyalty is worth it to United Airlines and if there is any proof other than continually moving the goal posts and showing me otherwise?”

  • Report this Comment On May 06, 2014, at 10:07 AM, wingnut1064 wrote:

    Sizedick was making a disater of Continental before the merger. He's not a leader and needs to be replaced. On another note, I am ex-con mechanic. There is way too much hatred between the UAL CO employees about the merger. We didn't make the decision to merge. Others did, it was and is out of our control. Things will change eventually, but we really need to start getting along better, for the sake of ourselves and the customer.

    And one other thing. How in the hell can you cut cost by $2 billion a year and not sacrifice the quality of the product!?!

    All Jeffed up!

  • Report this Comment On July 17, 2014, at 12:33 PM, cloudfloater wrote:

    Has anyone out there tried to get a refund that is due to them?? I've been trying for almost 2 months now, with no avail. What does it take? It is prohibited to speak to ANYONE in the refund "department", you must keep requesting things thru a refund request, and every time you do that, then it takes apx a week or so to get a response! And still to this moment, I can't seem to get anywhere with this! I've called over & over (usually get someone that cannot speak good English mind you), I've done the written requests over & over again! What does it take? GIVE ME BACK MY MONEY and NOT in the form of an ETC. You took it from my credit card and I want it put BACK on my credit card!!! This will be my last dealings with UNITED!!!

  • Report this Comment On September 28, 2014, at 8:49 PM, RSawicki wrote:

    I believe they deliberately difficult to get refunds

  • Report this Comment On September 28, 2014, at 8:51 PM, RSawicki wrote:

    'deliberately make it difficult' is what I meant

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Adam Levine-Weinberg

Adam Levine-Weinberg is a senior Industrials/Consumer Goods specialist with The Motley Fool. He is an avid stock-market watcher and a value investor at heart. He primarily covers airline, auto, retail, and tech stocks. Follow him on Twitter for the latest news and commentary on the airline industry!

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