from Dover, NH
writes : There is one other area that we might also look at.
We are all too familiar with the sour pussed agent and too forgetful of the very
pleasant person who went the extra distance to help out. I think Holiday
Inn and now USAirways have a GREAT idea. They send out special postcards to
their most loyal customers and ask them to search out the agent or
representative who has really tried to put their best foot forward. They
recognize these people for their efforts. I have found that in my business
the person who puts their best foot forward is the person everyone tries to
aspire to copy. Holiday Inn provides a ribbon with each card for the
employee to wear with pride. This too inspires everyone to exceed expectations
and have at least one ribbon to show off. I would be much happier with any
airline whose employees made that extra effort.
I flew three legs on UAL for the first time in over a year… My experience with
the people of United was pitiful, the people were the problem. We had no
problems with the planes, the seats, or the on time departures and arrivals. It
was the people of United who had chips on their shoulders, and attitudes to
Industry consultant Tom Ronell writes : I just attended the aircraft
finance conference in NYC this week. Carrier after carrier made presentations
demonstrating their being in denial: each one picked out some statistics which
showed that they sucked less than the other five (Southwest and other low cost
carriers were never included on the charts, except by ATA). They all felt that
they simply had to do nothing other than outlive their rivals (sort of like the
meeting the bear in the woods joke, where you only have to be faster than your
buddy, not faster than the bear.)
unanimously stated that UA's bankruptcy would cause UA to take enough capacity
out of the market for them to all raise their fares back to compensatory levels
at their costs. It never occurred to them that the AirTrans and Jet Blues of the
world will grow into that vacuum and that nobody will go back to paying $1400 to
go from NYC to Chicago. It's like going out of a parking lot; if you try to go
back, your tires get shredded by that device in the ground. Or it's like car
buyers, who will no longer buy without incentives. Bottom line: the majors feel
that they have done all they need to do, that as soon as 8-13% capacity is taken
out of the market and business travelers come back, fares will come back up, and
as a side benefit, UA will give them an excuse to beat up on their unions.
felt that they are so superior to the low cost carriers, that people will prefer
to fly on the majors and pay a premium for the privilege. Ditto for a low-cost
subsidiary that is associated with a major.
that should answer your question about why people think UA's bankruptcy will
cause costs to go down and fares to go up.
the way, congratulations on being the very first journalist to focus upon
McKinsey's role in all these bankruptcies around the world. How do they get away
with it? They are like the Dr. Death of airlines! And why does UA management
need them to come up with a "vision" for the airlines? Unbelievable!
anonymous airline industry insider writes :
Who's going to do the
definitive expose' on McKinsey's use of the word processor (OK, now, universal
replace: Swissair (and partners) with Varig with Delta with United -- let alone
Enron -- all Word Docs and PowerPoints) in 'strategically advising' the airline
industry into a smoking hole? For those kind of fees. No other term
for it than "CEO-controlled Flight Into Terrain" (CFIT -- check for it in NTSB
: I agree with everything you said in the article. I fly about 350,000
miles a year, 1K million on United and Platinum on American (since my clients
are all over the globe) and used to be in the airline business, so I have seen
both sides of the fences (sort of speak). I would like to add two other crucial
components to the list.
procurement of goods and services. Yes, the airline industry cost structure
is heavier towards the labor side compared to other major industries and I agree
United's labor costs are way out of whack, but they also need to look at the
costs of goods and services.
Case in point.
United decided to cut Champagne about a month ago on their domestic routes. I
started talking to the flight attendant about why they did it and she told me
that the catering company puts these bottles on-board with the wine and charges
for all of it regardless of whether it is used or not. Since hardly anyone
drinks Champagne compared to regular wine, United cut out the Champagne.
Well, as one of the
major customers to United, (the catering company), why can't they manage the
bottles of Wine and Champagne like they do the rest of the alcohol? It is very
easy. Stick the unused unopened bottles in one drawer, let catering re-stock
them on the next flight or next day or next week....they don't "expire" in a
short period of time. Just like the miniatures of alcohol on-board.
I know this is
small potatoes compared to the bigger picture on the cost of goods and services,
but it both shows how a poorly managed situation has flowed through to reducing
the quality of service to their VIP passengers, and also begs the
question.....what other goods and services are not getting managed? This is one
area - evaluating the procurement of indirect and direct materials - that I do
for clients, and invariably I secure cost savings of 10-15% on ALL the goods and
services spend. Imagine what the number would be for United when you are looking
at fuel, spare parts, MRO, general supplies, etc. It adds up FAST.
"accounting" process/evaluation. As a consultant working with Fortune 100
companies and a former Airline advisor to the COO of a major International
Airline, there are a few shortcomings with the way bean counters look at things
and the decisions that are made as a result.
Instead of looking
at the "total value" of the operating cost for a piece of equipment, they
usually focus either too much on the depreciations side of the equation (for the
write-offs), instead at the cost of capital (i.e. the procurement of new
planes), and then they are usually way too optimistic on the on-going
maintenance cost and total cost of operating cost of new planes compared to the
ones they already have.
We have only been
around the 777's for less than 10 years now, (where most other planes United
operates, with the exception of the Airbus's, which by the way, are already
running into a lot more operating/maintenance cost than anyone expected this
early in the ball game and have been a big disappointment on the maintenance and
reliability side) so until we hit the 15-20 year mark, you really can't get an
accurate take on what the true cost would be. I will say this about the 777's.
The reliability on them has been better than any other aircraft going, but don't
assume it will be that way after 15-20 years.....It could change. With the
747's, (that are parked in the desert), you can have accurate numbers. That is
why with United having a fleet age of somewhere around 7-8 years, they haven't
had real accurate cost on the maintenance of these planes (going forward)
because there is not a lot of history with them.
This is a
contributing factor to why United is bleeding far more than the analysts thought
they were and it is also the same reason why the ATSB rejected the bailout
package, optimistic expectations (cost side and revenue to cover it) which all
goes back to "questionable accounting" measures.
: I travel very often for both business and pleasure. I lived
in an eastern European country for 3 years on a job assignment that ended a year
and a half ago and traveled all over Europe on all kinds of airlines.
I was traveling on
business in the US in 2001, before 9/11 and traveled to and/or transitioned
through Denver and other United "hubs". I have never experienced longer
lines, slower service, more inept personnel, or less comfortable flights than I
have with United Airlines, and this was before the extra security requirements
when I have had a choice of airlines for the schedule and place I need to go to,
United is my last choice. There was more efficiency on Tarom Airlines,
which is the Romanian airline! If my experiences are typical, I am not in
the least surprised it is in bankruptcy on top of its mismanaged labor woes.
Downers Grove writes : Although you have a lot of good ideas, the
thing that I keep reading is that business fares are still too high. That's why
so many business flyers are looking for leisure fares.
But think about
this, business flyers usually don't gripe about the price of hotels and rental
cars, except for places like New York.
and car rental companies must be pricing their products at amounts that business
travelers find reasonable. But while Hyatt may price rooms at $69 to $119 on
weekends or during very slow periods, they don't price rooms that low on days
that large numbers of business travelers are staying.
I think that the
Big Six need to focus on pricing fares affordably for business flyers, and cut
back on leisure fares. Of course, fares should be cheap from Friday at 7 pm to
Sunday at 1pm. But if you want to fly at 7 am on a Monday, you will pay what the
business flyer pays.
charges a maximum of $299 one way. Obviously, the Big Six can't do that. But
they should quit trying to get 50% of their revenue from 10% of the passengers.
One other idea
would be to allow flyers, who get to elite status, to be able to buy tickets for
family vacations at better-than-published-leisure fares. Granted, the people who
only fly for leisure will be mad, but who keeps the airline flying? The business
: Just a quick comment about your hotel room rate analogy. Hotels
are 'wising up'. It is common for hotels to now have as many different
rates as airlines have - although the spread from the lowest to the highest rate
for the same hotel room is not nearly as great as it is for a seat on a plane.
You'll likely find that many hotels will sell otherwise unsaleable rooms at
discount rates, even on business nights of the week.
These rates are
often well 'hidden' and are sold in a way that protects the apparent integrity
of their published rates. How do hotels achieve this? One way is to
sell through Priceline.com; another is to sell through leisure wholesalers that
package the room cost up with other touring or traveling items so that the
actual low rate is obscured as part of a total package that would have no appeal
to a business traveler.
: I can't speak from much recent experience on United. My wife and I took
our extended family to Europe two years ago and it was so uncomfortable we
decided simply to scratch UA from our list of preferred airlines. We haven't
missed United a bit. Unless they return seat pitch to a healthy number, we would
not fly United for reasons of personal health.
: In fairness to United, I don't think that their seating is profoundly
much worse than any of the other airlines - they are all dreadful, and DVT (from
sitting too long in cramped seating) is a new issue that must have all airlines
very worried. The exception to this of course is American Airlines and their
'more room in coach'. But, I wouldn't know about United - it has been a
very long time since I last flew them to Europe, also! :)
: We were loyal United Fliers with hundreds of thousands of miles on the
carrier but quit flying with them after 9/11. We were onboard a United
Flight to Tucson on that fateful day - when they closed down all the airports,
the flight had to divert to Denver.
Due to all the
uncertainties, we rented a car and drove home to Chicago rather than on to
Tucson. United refunded only a portion of our flight saying that they had, after
all, flown us to Denver. Trouble is, we were not going to Denver and felt that
we should have been reimbursed the entire flight as other carriers did for their
passengers that day. We have switched to American and love the extra leg room.
: I saw something I had never before experienced on a recent United
flight. I am a 1K. After the flight took off the flight attendant handed me and
several other passengers one of the captain's business cards on which he had
hand written, "Mr. Heisler, I see that you are a 1K and I want to thank you for
What a great thing
to do to a loyal customer. I have never seen it done before and it was so easy
for him to do.
David adds :
When I used to regularly fly Qantas in their premium cabins (ah, the good old
days!) one of the highlights of every flight was when the captain would walk
through the cabin and stop to talk with every passenger.
I do agree that
very little things like what your captain did on the United flight can provide
enormous benefits to United in return. It should be encouraged.
: I agree. But unfortunately, with United or any other airline, the
service experience is not consistent. Among the dumb things United and the
others have recently done to discourage people from flying is the 63" limit on
bags and the resultant $80 charge to a passenger who obviously has no
alternative. Experienced travelers know that a skycap is the way around that
Another stupid idea
is their refusal to allow an upgrade on a free ticket. I offered to upgrade last
week and would have paid about $200 in coupons I purchased...but was not
permitted to do so. Thus they flew with an empty business class seat and instead
of getting $200 in revenue, were content with my flying for free.
And then there is
the fact that if your plans change your ticket becomes worthless. Great
way to reward 1K's or anyone else for that matter.
Laurie writes : As a travel agent I enjoy reading your opinions of how
United could survive, but what was that final slam about how we could "prove our
value to them". Do we not save them reservationist costs, ticketing agents and
advice givers for free now?
My present attitude
is who really cares if the BIG SIX survive as they have forced so many travel
agencies out of business. I have no problems with internet fares as many people
will not put their credit card on line and they want a human being to suggest
itineraries and dates.
: I've been an ardent and consistent supporter of the travel industry in
this forum and elsewhere, and I don't think that my suggestion that United
should return to paying some type of commission to travel agencies constitutes a
'slam' on the travel agency community!
However, much as we
each recognize and value the importance of the services that a travel agency
provides, variously to its clients and to the airlines, that doesn’t mean that
we should blind ourselves with our own world-view so that we can’t see things
from the airlines' perspective.
In case you haven’t
noticed (!) United and the other airlines don’t perceive any preponderance of
value-add at all in the things you list - they could care less if travel
agencies exist or not, and so they zeroed out your commission. If they did
value your services, then they’d pay you - in some form or another - so as to
get you to continue providing these services. But the services you mention
(when considered as part of the totality of travel agencies and their
relationship to airlines) are not sufficient to make travel agents a net adder
of value to airlines and their marketing distribution schemes. It is
impossible to argue against the ugly reality of this situation, no matter what
we both might variously wish and think.
However, one thing
that any airline will always crawl over broken glass for is true increased
business, which is most clearly demonstrated in the form of a greater than
normal market share. Maybe there are other things that you as a travel agent do
which you think are valuable, and which cost you money, but the only thing that
an airline values these days is extra business.
If I was you, and
negotiating with an airline to get some type of payments from it (and, believe
me, I've 'been there and done that' many many times) then I'd base my line of
negotiation on the basis of giving the airline more business, not on saving it
the bother of selling directly.
Bert adds : I agree with you that the airlines no longer value the
added items that a travel agent brings. The Big Six have been in trouble since
they started cutting services in the hopes the traveling public ( and especially
the business traveler ) would not notice. I remember years back that one of the
BS noticed they could' make' another million dollars by taking olives off the
salad. We as agents did not pay attention, and shortly we became the next way to
make more while delivering less. I find it interesting that South West continues
to pay agents and make a profit.
suggests that you hire a professional security service to keep you advised of
weather ,war and other things your travel agent used to do, included in the
price of the ticket. BTW many clients still expect free services we no longer
offer. I don't know where this will end up but I have noticed that the
appearance of long distance riders on Greyhound is improving by leaps and
bounds. Let's see - less hassle with security, unlimited use of electronics, and
lower price. Maybe the bus will overcome the greed of the upper management!
Value is only what someone will pay for or what someone perceives.
: I am amazed that these companies do not sell prepaid tickets in books or
mileage to generate money beforehand. Companies could save money for flights,
they could have extra money in house.
: Some airlines sometimes do (or did) offer such promotions. It is a
great idea, because not all tickets are ever redeemed, so the airlines get some
money totally for free, and it also then compels the purchaser of the prepaid
tickets to actually fly with that airline rather than another airline.
But would you feel
good about buying tickets that you didn't plan to use for almost a year on one
of the very financially shaky airlines out there at present? This is the
Catch-22 of this type of scheme. Offering prepaid tickets usually signals
a desperate cash shortage, and that means that sometimes it does more harm than
good because it reduces overall confidence in the airline.
Lan writes :
Why is there little mention in even the excellent comments of yourself and Joe
about how the long term anger being directed against "Un-United Airlines: (UUAL)
by former premiers is deliberately targeted to foil any recovery from
For over a year now
I've been going out of my way to avoid UUAL - even driving the extra half hour
to Long Beach Airport for a JetBlue flight (versus an LAX United flight). I
write my congressman/women about once a week to say "no bailout money for UUAL."
Colleagues who ask my advice on travel (and a few who actually pay me - although
in real life I'm a software salesman) receive detailed information on why and
how to avoid using UUAL. Avoiding UUAL is particularly important to companies
which are hiring young, inexperienced traveling staff who might be tempted into
starting as a UUAL frequent flyer and then cost their company millions in lost
money and time by trying to always fly UUAL for the miles.
There is nothing
CEO Glenn Tilton can do to 'redeem' UUAL. Even when their fare is among the
lowest I choose a 'non-UUAL' flight and even avoid Star as part of this
As a UUAL Premiere
Executive I was victimized by arrogant staff, deliberately cancelled flights (to
re-route me onto other UUAL flights), delays and high ticket prices. For too
long, I put up with it to worship the God of Miles.
But I'm a grown-up
now! I'm one of the most dangerous people to the UUAL system - an intelligent,
experienced, senior executive business traveler with a long term hobby of
pushing UUAL out of the travel industry. Nothing pleases me more than to read
how many UUAL staff are being laid-off. I hope that at least some of them are
the individuals who helped mess up my personal and business life. I also enjoy
walking past a line of UUAL passengers waiting for a delayed flight to my
on-time carrier. UUAL should call their clients 'victims' not passengers.
How determined and
vindictive am I against UUAL? While helping to choose a travel agent for a large
company recently, I dropped from consideration two agencies (two large agencies)
whose sales figures showed a large concentration of UUAL ticket sales. When my
legislator's travel analyst called for 'background information' on UUAL I used
your column and others to provide details of delays and to demonstrate the anger
and stupidities of UUAL.
Even if Tilton
himself visited me to ask what it would take for me to return to UUAL I'd tell
him - "you can't." United's failure, hopefully it's permanent removal from the
airline industry should stand as a warning to all others that there is a
long-term penalty when there's long-term abuse. Do I really believe it'll
happen? Probably not - large corporations have a way of manipulating legislators
and money sources to "recover" their operations - but I'll never be
onboard....and I know I'm not alone in this hobby!
: I felt a bit uncomfortable with Lan's negativism, but the simple fact is
that this is an accurate self-portrayal of the way that Lan - and presumably
others - do feel. It proves the well known claim that one unhappy customer
is ten times more damaging than is one happy customer beneficial.
While of course
United should do all it can to make us all happy customers, their first priority
has to be to stop making formerly valuable customers unhappy. And I do
hope that, when (if?) United does finally get its act consistently together,
maybe then, recognizing new management, new values, new everything, Lan might
give them another try.
: As an American frequent flier, I get packets of little coupons. When I
recognize really good service, I tear one of these off, put my FF number and
name and a comment, and give it to the responsible person. I have done this with
FA’s (most often), a couple of counter agents, and even mailed one for an
outstanding Platinum service center phone agent. It’s amazing how much positive
response a little piece of paper will get (I think they can “spend” the paper at
the employee store, and it may do something for their personnel folder, but I’m
not sure). (Good thing they have these, too - a couple of letters, and almost
every e-mail, to customer service, go unanswered, even by forms.)
I do not fly
United - I have done so a few times and have been appalled at the counter,
security (when they operated it), the baggage templates, the cabin service, the
surliness, the disorganization, and the plain lies when it came to trip delays
or cancellations- especially with the “Shuttle by United” which keeps rising
from the grave and is deserving of a final stake through the heart. And as a
6’4” / 196 cm pax, I may think American has a way to go, but the More Leg Room
has been a huge incentive for me to keep flying them.
from 'downunder' : What a pity you are not the CEO of UAL. If you were
I would probably keep flying with them. The main feature that would keep me with
UA would be your enhancements to the FF program (Mileage Plus). Your other
suggestions would certainly be helpful also.
don't believe that UA's management and unions have sufficient understanding of
their current predicament or vision for the future. After all, it was the pilots
in 2000 who just about brought the airline to its knees and set the scene for
what's happening today (their leader said he would strangle the golden goose
within an inch of its life) and I don't see them willingly giving up a penny of
their $300,000 salaries. Also, it seems the mechanics are determined to destroy
the company, come what may (as Eastern's mechanics did way back when).
So, alas, even
though I think your ideas are terrific, I am a little pessimistic about most of
them seeing light of day (but we can always hope...).
As for the
mothballed 747's, maybe it's a ploy to get rid of the senior 747 captains, who
must be costing a mint, or maybe it's just incompetence. Another problem is that
UA's 777's don't have the range of the 747-400's, so they can't be used for
non-stops to places like Aussie or Singapore (but I did fly on their 777's last
month AKL-LAX-AKL). As a passenger I know I prefer the 777, as the seating
layout is much better and it's not quite as big and impersonal. I must say I
prefer the 767 best of all (no middle seat in Business class).
Let's hope someone
senior at UA reads your artice and decides to implement a few of your
Bonnie from New
York writes : One question...did you send this article and the
feedback to the CEO of United? Maybe at last the big guns will listen at last,
for a change, to the little pistols who fly their airline.
Why don't the
executives of major airlines ask travel agents what the public wants? They would
get lots of feedback for nothing and maybe the right (or at least better)
answers to their problems. Do any of these guys at the top have a clue as to
what people want???? I think they just don't care as long as they can line
their pockets and run to the bank with big fat checks on pay day. Just sign me
fed and and disgusted with all airlines in New York. Thanks!
: I didn't send the article to United because they either don't care; or
else would consider it beneath them to consider free advice when they can pay
$1.5 million a month instead to receive doubtful advice from industry outsiders.
Consultants have a saying that is invariably proven true - 'advice is valued at
what the client pays for it', and on that scale, the McKinsey advice is plainly
very much more valuable than mine.
However, although I
didn't send the article to United, other people have! So maybe something
will come of it. But I doubt it.
Chuck from Bath,
MI, writes : The thoughts in your column certainly brought to mind
what I saw yesterday at ORD as a United passenger. Where were the 757's? There
seemed to be nothing but A 319's and A 320's at the gates. At this rate they
will be down to RJ's making 1500 mile flights for them.
As a 1K member for
many years I have my doubts they will survive this crisis. I have never
heard of a more dumb idea than trying to revive the Shuttle. Another dumb
idea is to reward those who have not earned 1K status in the past 12 months by
having their butt's in the seats for all of their miles. Some of us have
not needed "mileage runs" to achieve our figures. However, I will admit I have
received 8 or 9 business cards from pilots thanking the 1K's for being with them
on their particular flight.
It will be
interesting to see if United (or any other airline) will buy your ideas.
One last thought. I
have a zillion miler son who flies Continental and constantly tells me their
employees appear to be genuinely pleased he is flying with them. I have not
found this to be the case with United over the past 3 or 4 years.
A travel agent
writes : We have a couple that purchased United Airlines tickets to
travel on December 18, 2002. The husband had to have open heart surgery on
December 11, 2002. United Airlines customer service will give the husband
30 days to rebook, but the wife not. The wife is out of luck. Can
you believe this attitude?! I am sure they will never again travel on United
from California : United needs to give customers a good reason to fly
with them. And a temporary fare cut for limited types of fares isn't going to do
it. If they really want the customers, they need to :
1. Rip out seats
and increase the pitch on all their seats, not just a few on each plane.
2. Simplify the
fare structure and lower business fares to somewhere near those of the carriers
like Southwest and Jet Blue.
3. Don't annoy the
customers with unjustifiable fees and arcane rules such as
- If a customer
doesn't use any ticket, no matter what the fare basis, it should be good as a
standby ticket on that route at NO extra charge for at least a year or the
fare should be fully credited toward any other fare, again without fees or
penalties. Get rid of all penalties for changing flights the customer calls in
- Don't follow the
lead of Northwest and institute charges for baggage weights which have been
acceptable for years. 70 lb. is the OSHA standard for what one person can
handle and should be kept as the standard baggage limit.
4. Don't raise the
miles required for frequent flier tickets and at some point near the time of the
flight the rule should be "If you have the miles and we have a seat... it's
yours!" It doesn't cost them a significant amount to fill that otherwise empty
seat and the plane is going whether someone sits in it or not. And there should
be no extra charges for redeeming miles at a date near to the flight. With all
of these transactions being electronic, there is no justification for any fees
to use or reinstate miles.
5. Mileage based
upgrade rules should be the same for partner flights operating as a code share
as for a "real" United flight.
6. Move away from
the hub and spoke system and bring as many passengers where they want to go with
just one flight.
7. On routes where
there is enough demand, use bigger planes slightly less often. The odds are,
with less flights at large airports like O'Hare, more of them will take off on
time instead of sitting on the ground burning fuel on the taxiway.
A reader sent in
a copy of my column to United's Customer Relations email address. This
reply was sent back three working days later - a commendably fast reply, even if
it is 99% standard 'boilerplate' : Thank you for your message. First
and foremost, I want you to know we continue to focus on running a safe and
reliable airline and on delivering quality service. You may be assured that
United will honor your reservations now and in the future. Throughout our
reorganization under Chapter 11, United will fly. You will continue to have
access to worldwide markets for your business and pleasure travel needs flying
with United, United Express and our Star Alliance and codeshare partners. And,
all of our customer programs including Mileage Plus will provide you ongoing
travel benefits that are most important to you.
We have worked
extremely hard these past months and made significant strides in improving our
service. In fact, you may have noticed United ranked number one among all
airlines for on-time performance by the Department of Transportation. And this
was the second time in the last four months that we have attained this ranking.
We remain 80,000
optimistic and passionate people firmly committed to our most important asset -
you. And we'll treat you like our future depends on it. You are the key to our
success. With your continued friendship and support, United will be here for you
now and in the future.
I will forward your
suggestions to the proper management office for their future use. Thank you.
For the most
up-to-date information, we encourage you to visit our homepage at
www.united.com often. We look forward to serving you again soon. Thanks as
always for flying with United.
What do you think?.
Send David an Email -
Copyright 2002 by David M