Is Ch11 unavoidable for UA next year?

Hello everyone. I don't want to start another bashing thread and politely request that we remain objective.

As we know, UA is at an all-time low and continues to make changes that severely hinder its ability to retain loyal flyers. Other than its global network, UA doesn't seem to have anything valuable that AA/US and DL wouldn't offer and even surpass (e.g., better customer service, 1x2x1 J class configuration, etc.).

When UA lost $35 million from my company alone, I thought it would be somewhat rare, but from posts here, Linkedin, Facebook, et al., it seems that UA continues to lose many other contracts.

Thus, my focus of discussion is the following: even if Smisek is replaced, will UA ever be able to recover? Unquestionably, UA will need to spend lots of resources to lure back HV pax and offer competitive premium cabins. So if UA suddenly decided to change and bring back former amenities and services, how successful could the airline be if its actions were quickly matched by AA and DL? As things stand right now, even B6 will have a superior transcon product next year.

I think its avoidable but I am also in the camp that believes there is no way Smisek survives another year.

And he would care because?

I get what you're saying but.....He would care because he's a narcissist and he would have trouble loving himself when he got fired.

IME narcissists always find a way to paint the picture so that they win, even when they lose big.

I think for Smisek, failure (no matter how big his golden parachute) would be a huge blow to his ego, especially having a mentor who is worshipped.

Interesting you would bring this up, the new UA, without Smisek, et. al., would have to spend a small fortune to get back on the right track. It's possible, though -

A narcissist will blame every single person around him why his plan failed and then when done will start with weather, oil, Boeing, unions, etc.; he will even believe his own lies, re-writing history.

The human brain is amazing and a true narcissist has mechanisms built in place to protect a very insecure mind to survive. I just think, when he fails at UA, it will be a huge fall, very public, and so severe he is going to be corporate poison. Hubris will be tough for him to handle. (?)

^

Yea its going to be hard for them to regain their footing but I think its possible. The longer they keep him the deeper the hole is getting.

We don't need yet another Smisek-bashing thread. If you want to stick to the topic, great. If not, don't bother posting in this thread.

iluv2fly
Moderator, UA

This is kind of an inane question. UA is doing better financially than it has for years. It's not doing as we'll as other US airlines, but definitely had more precarious years. US air.ones have decided undercutting each other as they have been for years is a road to nowhere. Mergers plus the ensuing capacity reductions have resulted in better financial numbers for the airlines.

UA recently announced $1 billion in cuts. If it is already underperforming in comparison to its rivals who have actively been improving their products and services, you actually think UA's revenues will improve?

$2B.

Something very unfortunate financially would have to happen for UA to enter CH 11 next year. Bankruptcy is not a tool to address frequent flyer-alienating decisions or redesign cabins. It is a tool to restructure burdensome debt that is keeping the business for being solvent. UA's finances are in order - though trailing its peers - which means no judge would allow a CH 11 filing.

UA's woes are not financial. The airline simply has two faces: the one the passenger sees and the one its leadership sees. Leadership sees a merged United that serves more cities than ever, has a very competitive hard product on international flights and dominant hubs in IAH, SFO, EWR and IAD. It believes that operational challenges are behind them and every day things get better. Because of this vantage point they believe they don't need to offer as many incentives to gain/retain frequent flyers (we just want to fly United).

Of course, as we know first-hand, the actual UA experience leaves a lot to be desired. Yes, the network is expanded but as a passenger I could always get where I needed to go. Just because PMUA didn't fly to Quito, Ecuador, didn't mean I couldn't get there. I just flew another airline. Yes, the lie-flat hard product is competitive but the horrible soft product devalues it. Yes, there are people who are "hub captive" but the majority of passengers don't live in that environment. When choosing between other carriers with Wi-Fi, better on-time records, lower fees, lower fares, better service, and mainline aircraft, people will weigh their options and without a strong loyalty program to incent them they will defect. Unfortunately for UA another trip to the courts won't fix this problem. Only a new management point of view will...

Yes, but when Costs > Revenues, what's next? UA can continue making cuts and thereby further reducing its potential to achieve higher revenues. If high yield pax refuse to fly UA and the airline is losing major contracts left and right, it may not be stable for long.

Interesting topic.

I believe that UA will not go into chapter 11 however will continue to perform poorly.

This new $2B effort. I can't help to think that it was introduced to muddy the waters and re-set financial objectives / detract from the executive's poor performance in the past.

UA was not doing well when compared to other US carriers which was evident in the most recent quarterly release. By starting another initiative (the $2B effort) that "resets" the comparatives and gives "more time" to try to figure out how to win HVF.

The customer experience is not good and IT system that does not support the business well which filters down to the customer experience.

Last week I had an trip in which SHARES made a sked change that did not meet the minimum connection time. I did not notice until I was making my way back from Germany. The night before I called UA and the agent in SLC would not help by protecting me on a non-stop on another carrier (no space left on UA future flights). Prior to the merger, UA would put me on any carrier from any alliance to get me home The ironic thing is since I originated in FRA the Air Passenger Rights come into play however the agent did not know nor care and to me that is a reflection of the culture of the "new" UA, where the executives don't care about the passengers, which in turn filters down to the front-line staff.

In the end, something has to give.

Happy Travels.
Cheers

Channel 9 is a hugely valuable thing for me.

In the past year, my experiences with UA customer service have been much better and more satisfactory than with PMUA. That wasn't the case in the first few months after the merger, but now I find my interactions with FAs, agents, pilots, and CSRs to be almost uniformly positive, pleasant, affable, and helpful. ^

Not my experience.... Other than the infestation of Republic (an embarrassment to United!) on too many routes and too many abominable CRJ200s, I'm pretty happy with "the actual UA experience."

Of course, after 1/31/15 when I lose Platinum status, ask me again