Major United Policy Changes Announced
#181
Join Date: Oct 2013
Location: ORD
Programs: UA Silver, Marriott Platinum/LT Platinum, Hilton Gold
Posts: 5,594
Despite what the mass media might have you believe, this isn't a nefarious practice, as evidenced by the reports on the VDB thread of "I volunteered, but they didn't need me." People miss flights all the time. UA has historical information that helps them predict how many no-shows or last-minute changes they might get; they use that to figure out how many seats they can sell without having to deny boarding to anyone. They're quite good at it, but they're not perfect.
The new policy changes are fine, but more of a PR move. The fix that would have avoided the Dr. Dao incident was made a week or so ago, when UA changed their policy to not allow crew to be booked onto a full flight inside of an hour (IIRC is was 1 hr), of departure time.
#182
Join Date: Dec 2009
Posts: 349
When thinking about the effect of reducing overbooking on airline pricing, consider why airlines haven't already raised prices.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
#183
Join Date: Aug 2012
Posts: 6,728
When thinking about the effect of reducing overbooking on airline pricing, consider why airlines haven't already raised prices.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
UA needs to increase profit margins by reducing/limiting capacity, which now has become more challenging without aggressive overbooking and newly minted draconian measures, just to address a blackswan Pax event that will never happen again.
In my view, given the environment, Airlines will (or, ought to) seek to reduce capacity to increase margins. If done prudently, there are bright days ahead, especially with Oil prices likely capped at current levels.
#184
Join Date: Aug 2008
Location: PHL
Programs: UA 1K 1MM, Marriott Gold, IHG Platinum, Raddison Platinum, Avis Presidents Club
Posts: 5,261
EXACTLY! There are consequences to these changes.
The core problem is that airline ticket prices are too low. There are more people buying tickets than the system can handle. Basic economics says to add capacity and/or raise prices. Adding too much capacity carries huge risks for economic downturns (remember post 9/11?) so the best solution for airlines is to raise ticket prices.
The core problem is that airline ticket prices are too low. There are more people buying tickets than the system can handle. Basic economics says to add capacity and/or raise prices. Adding too much capacity carries huge risks for economic downturns (remember post 9/11?) so the best solution for airlines is to raise ticket prices.
Raising ticket prices, increasing delays/cancellations affects everyone in a relatively small way. Most people may not notice a few dollars more in price or remember a delay/cancellation. Problems that affect everyone don't show up on twitter or get picked up by the news.
A few DYKWIA people who don't know how to behave in public, follow the rules, and throw a fit might get recorded on video and go viral. Although it affects far less people and better for the whole, it can be very bad for PR.
Unfortunately this is the world we live in.
#185
Join Date: Jun 2003
Location: Philadelphia, PA USA
Programs: CO Silver, HHonors Gold, Marriott Silver
Posts: 982
You're making my point. Video is prejudicial because people tend to give it additional weight, as they assume it is accurate. It's a lot easier for the average person to determine when someone might be lying -- it's a survival skill that most people learn at a fairly young age -- than it is for someone to analyze a video and realize that it's incomplete.
#186
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
Only if management gives front line managers the discretion to respond as they see fit. I think we all remember SMI/J and his posse at the beginning of the merger complaining about how front line sUA employees were too generous in giving out compensation. They were going to end that and "run UA as a business."
That sure worked out well, didn't it?
That sure worked out well, didn't it?
#188
Join Date: Feb 2002
Location: BNA
Programs: HH Gold. (Former) UA PP, DL PM, PC Plat
Posts: 8,140
When thinking about the effect of reducing overbooking on airline pricing, consider why airlines haven't already raised prices.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
We often think businesses price on a cost plus basis or in order to maintain some level of profitability, but market forces and competitive pressures (even in an oligopolistic industry) are very important.
I don't think we'll see a chance in the published prices, though. Just a reduction in the number of "seats" available in the lower fare buckets. The cheapest tickets will just sell out a little faster resulting in an increase in average fare paid.
#189
FlyerTalk Evangelist
Join Date: Jul 2011
Location: RNO
Programs: AA/DL/UA
Posts: 10,749
If 3% of UA's traffic walks out the door because they're all pissed off at how Dr Dao was manhandled by the bouncers, and UA stops overbooking by 3%, then all is in equilibrium, right?
#190
A FlyerTalk Posting Legend
Join Date: Jul 2002
Location: MCI
Programs: AA Gold 1MM, AS MVP, UA Silver, WN A-List, Marriott LT Titanium, HH Diamond
Posts: 52,501
The automated VDB system is interesting. If United does this right, that is a genuine enhancement.
I don't get the need for a "customer solutions team". Every United employee who interacts with customers should already be thinking about client service and able to implement creative solutions to get people to their final destination.
A separate team suggests I'm going to still run into a layer that has no empathy, refuses to think and solve, and just kicks me up the chain to more-creative people. If there's a large WX event, are there going to be enough of those people to serve the demand without queues? (No.)
The $10,000 VDB cap was a sweet PR move by Delta (McNews outlets like CNN, USA Today, and the ilk gobbled it up as expected), but nobody anywhere is ever seeing $10,000 in real cash for a single-flight VDB. Not with the paltry low payouts on IDB that are currently in place.
The "no questions asked" lost luggage thing could have some unintended consequences. Hopefully the airline will ask enough questions to confirm that it did indeed lose the bag.
I don't get the need for a "customer solutions team". Every United employee who interacts with customers should already be thinking about client service and able to implement creative solutions to get people to their final destination.
A separate team suggests I'm going to still run into a layer that has no empathy, refuses to think and solve, and just kicks me up the chain to more-creative people. If there's a large WX event, are there going to be enough of those people to serve the demand without queues? (No.)
The $10,000 VDB cap was a sweet PR move by Delta (McNews outlets like CNN, USA Today, and the ilk gobbled it up as expected), but nobody anywhere is ever seeing $10,000 in real cash for a single-flight VDB. Not with the paltry low payouts on IDB that are currently in place.
The "no questions asked" lost luggage thing could have some unintended consequences. Hopefully the airline will ask enough questions to confirm that it did indeed lose the bag.
#191
A FlyerTalk Posting Legend
Join Date: Jul 2002
Location: MCI
Programs: AA Gold 1MM, AS MVP, UA Silver, WN A-List, Marriott LT Titanium, HH Diamond
Posts: 52,501
My guess: UA will lose a negligible amount of systemwide traffic, but perhaps a significant amount of ex-Asia traffic. I don't see loads on their domestic routes changing much at all. It's not like we're in love with the other two-thirds of the U.S. airline cartel.
#192
Join Date: Jun 2011
Location: EWR
Posts: 679
they might lose a lot of traffic ex-Vietnam, but markets like Hong Kong and China...no one even talks about this case anymore.
#193
Join Date: May 2013
Posts: 3,361
The automated VDB system is interesting. If United does this right, that is a genuine enhancement.
I don't get the need for a "customer solutions team". Every United employee who interacts with customers should already be thinking about client service and able to implement creative solutions to get people to their final destination.
A separate team suggests I'm going to still run into a layer that has no empathy, refuses to think and solve, and just kicks me up the chain to more-creative people. If there's a large WX event, are there going to be enough of those people to serve the demand without queues? (No.)
I don't get the need for a "customer solutions team". Every United employee who interacts with customers should already be thinking about client service and able to implement creative solutions to get people to their final destination.
A separate team suggests I'm going to still run into a layer that has no empathy, refuses to think and solve, and just kicks me up the chain to more-creative people. If there's a large WX event, are there going to be enough of those people to serve the demand without queues? (No.)
#194
Join Date: Oct 2013
Location: ORD
Programs: UA Silver, Marriott Platinum/LT Platinum, Hilton Gold
Posts: 5,594
People generally have short term memories about this kind of stuff. And those of us who spend a good portion of our time on airplanes realize that what happened to Dr. Dao would never happen to us.
#195
Join Date: Jun 2002
Location: Potomac MD
Programs: UA MP 1K
Posts: 7,182
pmUA FAs still talk about how UA has always been and still is more friendly toward passengers (at least to what Smisek called "overentitled elites").