This is a fantastic analysis and interesting history.

I think the conclusions and Next Steps need a lot of details filled in, and it will be intersting to see how Creighton does so.

Employee Confidence: Fair contracts are clearly a subjective matter, and I'm not sure if the employee groups can accept that the ESOP screwed them and fair has to be based on where we are now, not payback for the past. The money "stolen from them" (for lack of a better term) is gone, and employees can't be hung up on getting repaid for it.

Consumer Confidence: I'm not sure I see the support for retrenching to existing hubs and the Northeast. While SFO/SJC won't be back to what it was anytime soon, the west is the future. It would seem to be a long term mistake to abandon it. I would like to see UA shore up its West Coast operations following the dissolution of UA Shuttle, and stronger operations in the Southwest overall (UA presence in Texas is really embarrassing given Texas' role in the economy).

Even disreagrding that, though, is hub dominance really the formula the future? Southwest is profitable by avoiding this. There can only be so many hubs, but UA could use the operational consistency you stress to build a really smooth connection process and strategically invest in spoke-spoke routes that offer consumers more choice (maybe a second tier of mini-hubs would be a better description).

Investor Confidence: Just have and execute a well-thought out plan and investors will follow.

Innovations:

• The RJ idea is not a popular one with consumers. I drive 100 miles to Houston rather than fly an RJ from College Station to Houston to manage a hassle-filled connection.
• Strengthening presence in the top 10 markets with a better web of nonstops between them and/or smoother hub connections would give UA a huge advantage.
• A good way to attract "normal" flyers might be with something more tangible than miles. I don't know what WN does, but don't they have a simple "punchcard" sort of approach to getting benefits. Normal travellers probably don't get the 25K miles for a free trip, and would rather earn a free trip on segments or tickets. Establish some benefits like an upgrade that don't depend on frequency of travel on overall volume.

[This message has been edited by robb (edited 11-20-2001).]