And for your history lesson today...please recall that there were NO airline loyalty programs until after deregulation.
So?
Quote:
Originally Posted by chicagorich
If airline regulation makes a come back...airlines will not have to worry about about loyalty programs because their routes and profits will be...you know...regulated.
Because there were no loyalty programs in countries that had regulated airline industries.
And United never recognized 100K lifetime fliers either.
And cities never had multiple airlines serving the same routes.
Etc.
Quote:
Originally Posted by chicagorich
And as a bonus lesson...Southwest didn't "just" become unionized. It has been unionized for most of its existence.
I stand corrected. They still cook the repair books though.
GS - no charge
1k - 75% discount off asking price
1P/*G - 50% discount off asking price
2P/*S - 25% discount off asking price
3P - 10% discount off asking price
There would also be an option to get E+ access for a year for a cost based on your level of status.
As long as you can ensure that in situations like a standby, me, with my purchased E+ access for a year does not get stuck in 20E next to ChicagoRich while someone who clears the standby list a minute later gets 5C, I'll be happy to pay.
But I don't think it will make much difference.
Note that RCC+E+ access for a year is $750. And a 1K, pays $200 off the $500 RCC. Extrapolated, I'll pay $750*.6 = $450 for RCC+E+, or under $5 a segment. Nickeling and diming a 1K or a 2P isn't going to save United. And you were going to give it away for much less. Is pennying a word?
Accept my apology.. I thought you were a dying breed. The UGS's I've sat next to this year have been of the lower mileage breed (I mainly fly transpacific and transatlantic so making UGS their is easier for some)
No worries... Yeah....as much as I fly I feel like a dying breed!!!
I fly a lot of Transpacific myself....I ran into a guy last week in CMH that is a 1K now and used to be UGS for a couple of years. Flying the same amount, the only difference for him is flies mostly non-refundable fares nowdays vs. refundable. Unfortunately, the criteria for making UGS is not real clear.
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Quote:
Originally Posted by SFOtoORD
Interesting idea. I don't really like it, but if it was priced at $50-$100/yr I wouldn't mind paying it. Even though elites would be pissed, its not like this benefit is comparable to any other US mileage program.
USD 50-100 per year? Heck, that wouldn't pay for a season ticket to ride the bus to the airport. And the fact that you seriously suggest that sort of price for what is effectively a season ticket in E+, just goes to show why UA et al. don't make money: because they don't charge adequately for the services offered.
Wanna fly first? PAY for it, with cash and/or miles, no matter how many times you fly UA.
Wanna fly E+? PAY for it, with cash and/or miles, and USD 100/year won't cut it.
Wanna fly really really cheaply? Turn right, and straight down the aisle to the back of the plane, please. So you have a shiny card? That's nice, would you like to purchase an upgrade? No? Down to the back of the plane you go then.
Have a look at international premium economy, say Qantas or BA, find out what premium they charge for E+ against E-, take a fraction of that to allow for shorter domestic flights, et voilà! you have a price. Ask anyone who wants to fly E+ to pay that amount, unless you can't help upgrading folks due operational reasons. There's too many folks out there who want owt for nowt
USD 50-100 per year
Wanna fly first? PAY for it, with cash and/or miles, no matter how many times you fly UA.
Wanna fly E+? PAY for it, with cash and/or miles, and USD 100/year won't cut it.
Wanna fly really really cheaply? Turn right, and straight down the aisle to the back of the plane, please. So you have a shiny card? That's nice, would you like to purchase an upgrade? No? Down to the back of the plane you go then.
The whining elites on this thread don't realize that their pampered days sitting in the front of the plane are numbered unless they are willing to shell out the bucks for that special treatment. And that doesn't mean spending their employer's bucks paying marginally higher fares, expecting to be treated like royalty.
The whining elites on this thread don't realize that their pampered days sitting in the front of the plane are numbered unless they are willing to shell out the bucks for that special treatment. And that doesn't mean spending their employer's bucks paying marginally higher fares, expecting to be treated like royalty.
USD 50-100 per year? Heck, that wouldn't pay for a season ticket to ride the bus to the airport. And the fact that you seriously suggest that sort of price for what is effectively a season ticket in E+, just goes to show why UA et al. don't make money: because they don't charge adequately for the services offered.
Wanna fly first? PAY for it, with cash and/or miles, no matter how many times you fly UA.
Wanna fly E+? PAY for it, with cash and/or miles, and USD 100/year won't cut it.
Wanna fly really really cheaply? Turn right, and straight down the aisle to the back of the plane, please. So you have a shiny card? That's nice, would you like to purchase an upgrade? No? Down to the back of the plane you go then.
Have a look at international premium economy, say Qantas or BA, find out what premium they charge for E+ against E-, take a fraction of that to allow for shorter domestic flights, et voilą! you have a price. Ask anyone who wants to fly E+ to pay that amount, unless you can't help upgrading folks due operational reasons.
We're talking about incremental revenue for UA so $100/yr would be a lot better than what they're getting now from a cash perspective. In addition, if they didn't make the price cheap enough for elites there would be significant elite attrition (for better or worse) which would potentially result in having a whole lot of "op ups" (i use the term loosely) into E+
Also, E+ Access is $350/yr. As a 1K, for example, the RCC costs me $350 incl Spouse which is $800 as a GM. Extrapolate that and you're talking $150/yr for 1K E+ Access still not far from the suggested amt.
Finally, the flaw in your argument is that E+ is not a real Premium Eco class. They'd have to add more service to make it premium eco. Then they'd have the problem that they have way too many premium economy seats since most premium economy carriers charge a lot more and have few seats.
Quote:
Originally Posted by chicagorich
The whining elites on this thread don't realize that their pampered days sitting in the front of the plane are numbered unless they are willing to shell out the bucks for that special treatment. And that doesn't mean spending their employer's bucks paying marginally higher fares, expecting to be treated like royalty.
So, if United stops catering to the people who are "spending their employer's bucks paying marginally higher fares" then who will be filling their planes? They're going to need to drop a lot more than 30 737s at that point. Or maybe they won't need any planes at all. Ultimately, I think you're missing the point here. Flying up front on a Y ticket is a perk invented by certain airlines. People on this board may whine about their upgrades, but I think most travelers understand this to be a perk and thus its something that motivates them to fly their particular airline.
Last edited by FlyinHawaiian; May 1, 08 at 7:31 pm.
There would also be an option to get E+ access for a year for a cost based on your level of status. This will force people to either pay for their access on a yearly basis or per flight no matter what level of elite status. Everyone knows E+ keeps passengers and taking advantage of this and loyalty to a mileage program can draw a larger amount of cash towards UA.
And for those on elite heavy routes who have purchased the yearly plan yet consistently get sent to the back because loads are high an E+ is full????
Thinking about this from an interesting perspective has been fun. So I will offer up my ideas and see what comments I can generate.
1. Mileage Plus
The first thing I would do is to change the MP program into two programs. Much the same way that SQ uses KF and PPS. The miles you earn go towards your MP status 2P/1P/1K and the money you spend goes towards GS status (I use GS as it is the only basis I have for UA) UA then would need to create a number of different benefits for the GS members (more than we have today). Look to the PPS program, pre-gutting, for ideas.
Upgrades -- Look for ways to generate revenue from the upgrades. i hate to say it go to a co-pay system for mileage based upgrades. look at $100-$200 per trip/direction to upgrade using miles international and $20-25 domestically. Consider fare class limitations on upgrades with miles domestically. SWU would be exempt from this fee for H+ fare, but would pay for H> fares. CR-1 would be exempt from upgrade fee.
2. Aircraft
Kill the 737 fleet. Keep the airbi, but look to renewal as they are starting to have issues as well. E+ needs to stay and continue to upsell the seats at the airport for added revenue.
3. Routes
Look at the routes critically. If a flight (not a route) does not average over 65% load factor over a three month period the flight goes. Look at flights on a per day basis as well. In other words if a flight averages 90% on Monday but 50% on Tuesday the flight remains on Monday, but not on Tuesday.
Also look at revenue per flight. If a flight cannot cover its costs even if it is full then it goes. Don't sell a ticket if the cost of the ticket doesn't cover the costs of the passenger. Determine a cost per passenger based on historical data (Don't use CASM)
4. Service Fees
Charge for checking bags. No more free baggage allowance. You pay for what you bring. $10 for the first bag and then the $25 for the second bag. a third bag will cost you $300. Charge for golf clubs, skis and the like.
Kill the 800's. They cost money replace them with standard numbers. Have a rolling bank of phones that are free at airports for calling reservations in the event of disruptions.
Look to AC for how to charge for inflight services.
5. Wages
This is probably the hardest one to actually get implemented, but move almost everyone to salary. Further, no employee can earn more than 10X the lowest paid employee. This would be done on a FTE basis not actual pay. So if a FA is equal to 1/2 FTE (because they work 80 hours a month instead of 160) then the FA FTE salary would be 2X. So assuming the lowest paid FTE earns 38K then the higest paid person in UA could only make $380K salary.
6. Other ideas
Keep flight crews and aircraft together. No more waiting for crew. If the plane is there then the crew is there. The only time you would be waiting for crew is if an entirely new crew was coming on board to handle that aircraft.
I have some more but need to get back to work
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I forgot to add one of my biggest issues with United: close down the Indian Call Center and the Indian Web Support. Then send all reservations and web support back to the US. We all know how many issues have arisen do to poor call centers and web support.
Improve united.com so it functions properly. It is often an issue attempting to use an ECert on the website as the discount does not apply itself properly, and then one has to call web support which becomes very cumbersome.
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Quote:
Originally Posted by chicagorich
The whining elites on this thread don't realize that their pampered days sitting in the front of the plane are numbered unless they are willing to shell out the bucks for that special treatment. And that doesn't mean spending their employer's bucks paying marginally higher fares, expecting to be treated like royalty.
.
Royalty. Royalty? We are talking about United Airlines in-flight service, are we not? Royalty? Not Singapore or ANA...United Airlines First.
I cannot remember in the last 4 years ever feeling like royalty on a United flight. Much more like a commoner.
1. Get rid of change fees, like Southwest Airlines.
2. Treat the employees better, like Southwest Airlines.
3. Hedge fuel costs, like Southwest Airlines.
4. Drop unprofitable cities, like Southwest Airlines.
5. Reduce the number of different types of airplanes, like Southwest Airlines. Fly one or at most two aircraft for domestic, plus the 777 and 747 for overseas.
6. Control costs, like Southwest Airlines.
7. Migrate away from hub-and-spoke, to a flight network, like Southwest Airlines. This reduces costs and makes baggage handling more efficient. It prevents a weather event from crippling the entire network.
8. Get more Saver Award availability, like Southwest Airlines. I've been checking recently, and 25K domestic awards are pretty tough to find. 90K awards in business to Europe don't exist. 110K to Australia don't exist. Yet, compare that to Southwest, where 4 round trips DEN-LAS, with a rental car at Hertz with QUAD credit = 1 free domestic ticket. (Total BIS miles = 629 x 8 = 5,032 miles). And, Southwest has a lot more availability for award redemption.
9. Get rid of the India call center. Have a US call center, like Southwest Airlines. The people that work there may have a little bit of Texas drawl, but they are easy to understand and they know their stuff!
10. Simplify the business (for example, no change fees), thus simplifying the web site. Then the web site would work, like Southwest Airlines.
11. Give free, unlimited first class upgrades, like Northwest Airlines. (HA! You thought I was going to say Southwest, didn't you?!?)
12. First two bags are free, third bag costs $25, like Southwest Airlines.
13. Get better seats in Business, like BA and CX.
14. Get a better IFE system, like CX.
15. Status match continuously. As long as a person has Southwest A-list, he has 2P at United. Match 'em year after year. At least United would pick up some of Southwest's business this way. Make it so 32 flights on ANY airline = 2P status on United.
16. Fare match Southwest. Just like if you bring a Circuit City ad into Best Buy, Best Buy will match Circuit City's price and vice versa, so too would it be that if you enter Southwest flight numbers and the Southwest price on United's web site, the web site would electronically verify Southwest's price and then give you that price at United. Flights need to be within 2 hours of each other. Or maybe 4 hours...
17. Make food quality at least equal to Southwest on domestic flights. That means peanuts on short flights; peanuts plus crackers on 500-1000 mile flights and a snack box on 1000+ mile flights. Could also give a choice between peanuts and pretzels. Food quality of BA or CX on overseas flights.
18. Give a full can of soda, without question or a dirty look, upon request, like Southwest Airlines. A can of soda is 30 cents at Wal-Mart. Does United really need to split that into 4 cups so that it only costs 7.5 cents per pax? Doesn't giving a full can of soda buy more than 23 cents of goodwill?
19. Start to migrate to an all 787 fleet to control future fuel costs.
This idea is more palatable if UA will give up on TED and allow those 320s to re-enter the fleet as regular configuration 320s. They'd also save on FA labor because they could operate with 3 instead of 4 FAs.
It's time for UA to do what every other airline has done and abandon the "carrier within a carrier" concept.
I didn't read the rest of this thread yet, so maybe it's already been covered, but I agree with this. Here's what I would do:
- Economy becomes Ted - on all flights. Go the LCC route. Pay for everything - checking a bag, getting a snack, buying headphones, getting a seat assignment, etc.
- E+ becomes what Economy used to be. Maybe even *gasp* free snack boxes, and full cans of soda. Sell tickets at a higher price, or free for elites.
- First stays as-is.
- Ted goes away 100%.
Basically, this lets people pay for what they really want. The bottom feeders can pay for E-, the business travelers will probably opt for E+, etc.
Haven't thought about anything beyond that, because I'm not paid to be an airline CEO.
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Quote:
Originally Posted by FCfree
1. Get rid of change fees, like Southwest Airlines.
As discussed on the change fee thread, I sincerely doubt if this would drive any signficant business towards UA, compared to the loss of revenue from the change fees. Most people are not FTers and are not driven by lack of change fees.
Quote:
Originally Posted by FCfree
3. Hedge fuel costs, like Southwest Airlines.
Too late. Hedging at this price may even be detrimental, if you believe the pundits who predict a steep decline in oil prices as the dollar regains strength.
Quote:
Originally Posted by FCfree
5. Reduce the number of different types of airplanes, like Southwest Airlines. Fly one or at most two aircraft for domestic, plus the 777 and 747 for overseas.
And where, prey tell, will UA get the money to lease or buy additional planes of that type (or those 2 types) to replace the significant capacity lost by removing the other airframes?
Quote:
Originally Posted by FCfree
6. Control costs, like Southwest Airlines.
UA cannot control its costs in the same way as WN. They are fundamentally different business models, and UA is bound by its many organized labor contracts, which it effectively cannot dissolve without going bankrupt again.
Quote:
Originally Posted by FCfree
7. Migrate away from hub-and-spoke, to a flight network, like Southwest Airlines.
That works for domestic travel. International travel essentially requires hubs. If you're already going to have hubs for international travel, you may as well use them for domestic travel, as well, because that will reduce costs, too.
Quote:
Originally Posted by FCfree
8. Get more Saver Award availability, like Southwest Airlines. I've been checking recently, and 25K domestic awards are pretty tough to find.
Really? Because I also looked recently and was able to find domestic savers without any problem. It all depends on your route and the season. The international savers are irrelevant to your comparison with WN.
Quote:
Originally Posted by FCfree
10. Simplify the business (for example, no change fees), thus simplifying the web site. Then the web site would work, like Southwest Airlines.
The website is poor not because of the fees, but because of the mediocrity of its programmers. The business model isn't all that complex, and any number of competent programmers could turn it into a world-class website even with the existing business model. The problem is that UA hasn't hired such programmers. That is the problem.
Quote:
Originally Posted by FCfree
11. Give free, unlimited first class upgrades, like Northwest Airlines.
That has been argued time and time again. It benefits the highest elites to the detriment of mid-tier and low-level elites. High elites bring in more business, but low/mid-tier elites won't be incentivized to become or stay elite (at any level) if their upgrade chances are negligible. It's a toss-up, but IMHO UA's model is the more generous on average.
Quote:
Originally Posted by FCfree
13. Get better seats in Business, like BA and CX.
Funny, I thought that was already going on... If somewhat slowly...
Quote:
Originally Posted by FCfree
15. Status match continuously. (...) Make it so 32 flights on ANY airline = 2P status on United.
And how would this benefit UA at all? It entirely belies the point of a loyalty program. It would allow frequent flyers to become just as fickle and price-driven as infrequent flyers. That's a bad thing, not a good thing.
Quote:
Originally Posted by FCfree
16. Fare match Southwest.
They do this, when it is warranted. If fares are higher on UA it's because people are paying them. Loads are at record values. If people weren't buying tickets at the current higher prices, UA would be charging less (as it sometimes does) or reducing capacity (as it sometimes does).
Quote:
Originally Posted by FCfree
Its so simple, a caveman could do it.
It's so simple to say. It's much harder, if not impossible and/or downright detrimental, to implement many of these suggestions.
UA cannot operate like WN, as it is bound by many different restrictions. UA also has to balance its domestic operations with its int'l operations, something which WN does not have to do. They are vastly different beasts.
A couple of years ago, RJ's were supposed to be the savior that would allow the airline industry to right size itself while saving on fuel and pilot costs.
RJs suck more fuel per passenger than mainline planes do, and far more than turboprops. Turboprops are more efficient for various reasons, but for most people's purposes the most notable reason is that they're slower. And since much of the fuel is used in takeoff, obviously two CRJ-200 flights will consume more fuel than one A320.
RJs did have more favorable economics when labor was the #1 cost of flying a plane: the pilots/FAs aboard RJs are paid a fraction of what their mainline brethren get. So, as long as oil was cheap, RJs got subbed for mainline whenever possible: the airline could increase frequencies and cut costs. Beautiful.
However, oil prices have exploded. DL/NW says that 17% of revenue in 2003 covered fuel costs (second biggest cost center, after labor); now 43% of revenue goes to fuel. The usual contract between a network carrier and its "regional affiliates" makes the network carrier pay for fuel. Fuel costs have pushed seat-mile costs for RJ operation way up: by one estimate, the ATL-ISP route recently cut by Delta cost them $0.17 per seat-mile to fly -- demanding a $270 RT fare just to break even. The average airfare paid per mile ("yield") on the Big Six airlines (plus Alaska) in March was $0.1387. Delta will still sell you an JFK-ATL seat for $198 -- and a JFK-ATL-CHS for $188, meaning that the net fare paid for that RJ flying ATL-CHS is -$10. So, while I'm sure Long Islanders were annoyed, you can see how axing these RJs makes financial sense.
You can expect to see many fewer of the CRJ-200s in the future. Either those cities will get lopped off the network entirely, or they'll go to many fewer flights on bigger planes -- if not mainline, then at least explus-sized (70+ seat) RJs, which combine better fuel economy with the favorable pay rates of Shuttle America/GoJets. However, adding more of the explus might require renegotiating the pilots' "scope clause" -- UAL's mainline pilots are rightly fearful of such substitution.
Back on thread:
- I completely agree with #107: a little courtesy, a little contrition, and a lot of communication, go a long way. I very clearly remember a few key moments when staff (often UX) went the extra mile during delays to keep us updated -- little things like bottles of water while stuck in the ORD penalty box, briefly explaining why something was happening, and of course the occasional op-up.
- Yes, ultimately FFPs will resemble their hotel brethren and be more revenue- than mileage-based. I am going to end up back in 30B, where cheapos like me belong.
- Maybe UAL should seek a TPAC revenue sharing deal with NH/SQ? I'm also warming to the idea of bringing B6 into *A, even if it still sounds a bit far-fetched.
- You can't have an airline that combines WN + CX. UAL has tried, but people want to know what they can expect when they get on board -- and those two have radically different on-board experiences. As has been pointed out, you can't run a point-to-point overseas operation: you absolutely have to funnel traffic into a hub to justify flying a 747 over the Pacific. Hubs also allow for many, many more schedule options for travelers, especially if you live in a hub. (WN has hubs, BTW, but they just don't call them that. You can bet, too, that when they follow through on their threats to start international flights, they'll do it from their Not-Hubs: OAK, BWI, HOU/DAL, MDW.)
- I actually don't mind the fare unbundling that AC does. Go try a dummy reservation sometime and take a look at the options.
- I still don't understand why we can't buy BOB coupons from Mr. Chicken (or Online Chicken); after all, he has my credit card number. As I understand it, AA's chickens even automatically spit out whatever appreciation tokens are due your way (like meal vouchers during a delay).
nice generalization....
