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United CFO Rainey Implies Certain Elites were "Over Entitled".

United CFO Rainey Implies Certain Elites were "Over Entitled".

Old Jul 15, 2012, 10:29 am
  #1546  
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Originally Posted by chitownflyer
UA's C & F class products are good, but they do not hold a candle compared to the likes of LH, SQ, LX, NH, and TG, and experienced flyers will book paid C or F on these carriers.
Haven't flown anything but TG C, and it was medium haul, not TPAC, but I for one was underwhelmed by the experience. Perhaps my expectations were too high after posts like chitownflyer and others, but the hard product with lie flat on UA is quite a bit better.

The one and only segment in C on Asiana was a step up, but still hard product not as good as UA lie flat seats.

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Old Jul 15, 2012, 10:52 am
  #1547  
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Originally Posted by star_world
Now if they could get the front-line PMUA employee based properly trained so they can perform changes for me as quickly as their PMCO counterparts, which is incredibly time consuming given the complexity of the system I'd be completely happy.
LOL, I wish you had been with me in June 2011 when I was on my first pmCO flight, an IAD-EWR-CPH run. Up to this point I had never experienced so many agents pass the buck on a single flight. At check in at IAD when I had a question about the EWR-CPH flight, I was told you'll have to ask in Newark. When I got to Newark, the PC staff couldn't have been more unhelpful. When I got to the gate, the CSR was too busy to help. Then when I got on the plane, the lead attendant got on the PA system to tell us that they had just had a FA removed from the flight to staff another flight, and he apologized in advance for minimal in-flight service.

Yes, many pmUA agents don't yet have the same proficiency with Shares as do their pmCO counterparts, but that's the fault of the airline's leadership.

Since 3/3, I have encountered many fine agents from both pmCO and pmUA, but I've also encountered many lazy pmCO and pmUA who love to say "I'm sorry, the system won't let me do that" instead of actually trying to help.

[Personal attack against another member deleted by Moderator per FT Rules.]

Last edited by Ocn Vw 1K; Jul 15, 2012 at 3:54 pm Reason: See above note.
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Old Jul 15, 2012, 11:05 am
  #1548  
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Originally Posted by star_world
I wouldn't, and I'd love to hear how you could reach that conclusion from that metric alone. Do you believe it?
It will be the single most revealing statistic from the earnings release. Others will flesh out the story, but a PRASM gap vs DL and AA will be telling
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Old Jul 15, 2012, 11:54 am
  #1549  
 
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[Unduly personalized references deleted by Moderator.]

Originally Posted by star_world

Add me to the list of people who has been consistently upgraded on all expected flights since 3/3, never had to wait more than a minute any time I called the 1K line and have had terrific rebooking experiences during the IRROPs I encountered.
I explained in my earlier post why you are getting your upgrades easier now; You are competing with fewer elites.

If you choose to believe otherwise, good for you.
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Last edited by Ocn Vw 1K; Jul 15, 2012 at 3:56 pm Reason: Edited by member for spelling; edited by Moderator to remove unduly personalized references.
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Old Jul 15, 2012, 12:19 pm
  #1550  
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Originally Posted by UA-NYC
It will be the single most revealing statistic from the earnings release. Others will flesh out the story, but a PRASM gap vs DL and AA will be telling
Actually, the most telling statistic would be domestic yields. US carriers don't release that, so you could look at the quarter-over-quarter change in domestic yields, which would indicate if UA is selling tickets at higher or lower prices. UA had a 3.3% increase in domestic yields during 1Q12. A flat or negative in 2Q12 does not conclusively indicate elites are leaving, but it will certainly raise difficult questions from analysts and investors.

Consolidated PRASM is relevant to overall network health, but is disproportionately impacted by international flights, which in turn are being impacted by economic events. No one in the industry draws far reaching conclusions from one quarter of PRASM numbers, though you're certainly welcome to.

Originally Posted by dgcpaphd
This is what I love about flyertalk, also. One person presents information from a reliable source and invariably, a Continental apologist comes to the rescue of the new UA management's unconventional managerial style.
This is what I love about FlyerTalk too.

Last edited by sxf24; Jul 15, 2012 at 1:12 pm Reason: Clarification
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Old Jul 15, 2012, 12:26 pm
  #1551  
 
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Originally Posted by fastair
No. 2 different revenue management systems combind, need a solid years worth of combined data to really be able to optomize both th networks and the adjustments. Sure, they can extrapolate te data from 1 or both of the old systems and apply it to the currnt/future planning, but doubling the number of hubs with new connecting points and different flow of passengers would make a "best guess" scenerio not all that perfect. And when you are talkingabout the difference in just acouple of % points difference is RASM increase, hard data vs "best guess" can surely account for at least 2% points on a predictive model wherehumna behavior (not all that accurately predicted to begin with) is a major variable. That doesn't even account forall of the new feederpaths that UA now has that weren't there before.

For accurate asbolute numbers, I would stat with 3rd quarter of 2013, and for a relative number to previous yar's performace, I would use those results as a baseline and fair comparison using only a relative number (which is what you are comparing, growth to previous year vs other airlines similar numbers) would take 1 year beyond that, 3rd quarter of 2014. Of course if we had accurate absolute numbers, then the 3rd quarter of 2013 should be accurate enough.
I recognize that we are all off in the land of speculation Fastair, but I respectfully think that the opposite of what you suggest is true. Both PM airlines had smaller footprints, and as a result lost certain corporate business, and especially high value business traffic where they did not serve. The merger was sold as being able to capture this traffic (CO passengers doing to asia and the western US would now stay on the carrier, ditto UA passengers to the Europe and South/Central America) PLUS being able to get new corporate accounts. The merger was also sold as being able to "optimize" revenues by putting planes were they were needed and to funnel more traffic into overseas flights.

Cross-fleeting is occurring (putting the seats where they are more effectively sold) and the networks are combined. At this point UA ought to be getting an INCREASE in PRASM as a result of these things.

And as far as IM, as I've noted before there will be around the edges some issues, but given the networks size, I seriously doubt that they are loosing much. Their network is so big that they have been able to adjust as tickets are sold (for example I find connecting on routes I fly via IAH is often cheaper) and this stuff is dynamic. Certainly any IM learning curve is far less of an effect than things I discussed above that were EXPRESSLY SOLD TO THE MARKET AS INCREASING YIELD and ought to be increasing PRASM.

I think that what is happening is that these merger benefits are being swamped by other factors which are costing UA high value traffic. I think the view that "oh we just need to optimize our IM system and much of this will be fixed" is - unfortunately for United employees - simply whistling past the graveyard.
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Old Jul 15, 2012, 12:28 pm
  #1552  
 
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Originally Posted by dgcpaphd

Why, yes you may ask. A few months ago when I was going through the process to status match with AA, the process took longer than I was initially told by AA. Along with the approval came an e-mail from AA's elite section with an apology for the delay. The apology was an explanation that AA had to hire additional employes merely to handle the status matches.

The e-mail stated, among other things, that the response to the status match offer was far greater than anticipated and at the peak of the status matches, AA was handling about 5,000 matches each day.

"I" don't know what I am talking about? I think you have that backwards.




I explained in my earlier post why you are getting your upgrades easier now; You are competing with fewer elites.

If you choose to believe otherwise, good for you.
-
I was told by AA agent that for a period of several weeks, 100% of her calls, from start to end of day, were status matches to UA flyers.
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Old Jul 15, 2012, 12:59 pm
  #1553  
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Originally Posted by sxf24
Actually, the most telling statistic would be domestic yields. US carriers don't release that, so you could look at the quarter-over-quarter change in domestic yields, which would indicate if UA is selling tickets at higher or lower prices. UA had a 3.3% increase in domestic yields during 1Q12. A flat or negative in 2Q12 does not conclusively indicate elites are leaving, but it will certainly raise difficult questions from analysts and investors.

Consolidated PRASM is relevant to overall network health, but is disproportionately impacted by international flights, which in turn are being impacted by economic events. No one in the industry draws far reaching conclusions from one quarter of PRASM numbers, though you're certainly welcome to.
So for this airline that's touting its extensive global reach, and relies on paid int'l C/F to make the lion's share of profits - you're saying that domestic yields will be the most telling statistic of all? Wow.

I guess if the analysts know the monthly PRASM numbers, expectations should be baked into the share price already, and we'll only have nominal stock price movement after the earnings release, right? Guess we'll see.
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Old Jul 15, 2012, 1:10 pm
  #1554  
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Originally Posted by UA-NYC
So for this airline that's touting its extensive global reach, and relies on paid int'l C/F to make the lion's share of profits - you're saying that domestic yields will be the most telling statistic of all? Wow.

I guess if the analysts know the monthly PRASM numbers, expectations should be baked into the share price already, and we'll only have nominal stock price movement after the earnings release, right? Guess we'll see.
If you're trying to determine whether elites are leaving, yes, you would look at the change in domestic yields since the majority of elite passengers are traveling domestically.

Even though I don't agree with the premise of the question, I am trying to be helpful and provide some legitimate insight into what metric you should look at. [Unduly personalized remarks deleted by Moderator.]

Last edited by Ocn Vw 1K; Jul 15, 2012 at 4:00 pm Reason: Please see above.
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Old Jul 15, 2012, 1:20 pm
  #1555  
 
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Originally Posted by njcommodore

AA can say whatever they want. And front line staff at both airlines won't be privy to hard data. Oh and where did I defend UA?
It is not AA's management that has the severe credibility gap. If the person in charge of AA's elite department says something, I have no reason to doubt it.

On the other hand, with respect to believing something said by UA management, I can only say that UA would not be in litigation with million-mile fliers if they didn't have an issue with telling the truth.

It is true that many who took the AA status match said they had not yet flown AA. However, something is causing the sudden availability of upgrades. A likely reason is fewer elites at UA.
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Old Jul 15, 2012, 1:43 pm
  #1556  
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Originally Posted by sxf24
Even though I don't agree with the premise of the question, I am trying to be helpful and provide some legitimate insight into what metric you should look at. If you would like to jump right to a predetermined conclusion without any analysis, please let me know and I won't put any effort into having constructive dialog.
There's plenty of analysis to be found on FT - it's how believable you find that analysis based on what's been said on other topics. YMMV.
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Old Jul 15, 2012, 2:02 pm
  #1557  
 
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Originally Posted by cova
I would not worry about triggering the GPUs early. Apparently, UA is aware of this problem - where people are not flying UA so as to delay the trigger point on GPUs. I am guessing UA is losing business because of this.

A simple call to the MileagePlus desk will get them extended to the end of the year. Others have reported this, and I just did it with some GPUs that were expiring in September - now extended through the end of December.

My guess is that UA will change this in the future and make them expire at the end of the year. On AA they run until the following Feb - a year later - so UA is not competitive here.

But fly UA if you need to and don't worry about the GPUs.
Do you have confirmed extension of 2013 GPUs to the end of the year ie Dec2013? Nothing i have seen has suggested this will happen.
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Old Jul 15, 2012, 3:25 pm
  #1558  
 
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Originally Posted by sxf24
If you're trying to determine whether elites are leaving, yes, you would look at the change in domestic yields since the majority of elite passengers are traveling domestically.

Even though I don't agree with the premise of the question, I am trying to be helpful and provide some legitimate insight into what metric you should look at. If you would like to jump right to a predetermined conclusion without any analysis, please let me know and I won't put any effort into having constructive dialog.
I don't know where you made this up from, if you have a cite, I would like to see it...

I have heard it said that most GS members are international passengers (I'm one of the few, or so I have been told, who is mostly domestic) But I know of nothing UA has ever said on the point. Ditto total elite members, you are probably correct that there are more domestically (just total numbers) but I've never seen anything that says this.

Clearly changes in the MP program will have different effects on both sets of passengers, but then I think for the top elites flying internationally, many also fly domestically. Regardless, I see no reason why one would not look at both domestic and international Loads/profitability metrics to know if the current approach is working. The ability to attract premium traffic is the broader issue, and the complaints/issues don't just effects folks with MP status. The loss of a $10K C fare is a loss, wither its to a MP member or someone who is not.

And since you main point is that international is (so you allege) effected more by international conditions, that is why UA's PRASM is compared to other global airlines (DL and AA). Its the relative spread that one looks at to see how UA is stacking up, not the absolute numbers. I've posted these absolute numbers elsewhere, as you know. No surprise UA is doing poorly compared to other airlines.

obviously if you wanted to see how UA was stacking up to SW or JetBlue or US with its lighter international footprint) then you might look at the domestic PRASM numbers, but I don't think that is your point.
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Old Jul 15, 2012, 4:36 pm
  #1559  
 
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FWIW, the RASM numbers are posted by the major carriers every month. For June, Delta and AA posted year on year June RASM growth around 8%, United posted growth in the 4-6% range.

I saw a WSJ piece that suggested about 25% of total revenue is from loyalty program fliers; so if you lost very roughly 10% of those customers due to angst, rage, frustration, or whatever and couldn't replace them with an equivalent volume (and by definition, you need a pretty good number of one off, price only, once a year customers to replace one frequent customer that ignores small differences in price or tosses all the "ties" to a single preferred carrier), that volume of lost business very, very roughly accounts for the spread. But, it is a complex problem and I do think it will take some time for this to play out in the numbers.

I will say, that if United doesn't stop booting my over-entitled self out of the exit row on E-145 flights 24-48 hours before departure, they are going to have to incrementally find another 50-70 round trip customers/year to replace me come January.
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Old Jul 15, 2012, 4:37 pm
  #1560  
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Originally Posted by spin88
I don't know where you made this up from, if you have a cite, I would like to see it...

I have heard it said that most GS members are international passengers (I'm one of the few, or so I have been told, who is mostly domestic) But I know of nothing UA has ever said on the point. Ditto total elite members, you are probably correct that there are more domestically (just total numbers) but I've never seen anything that says this.

Clearly changes in the MP program will have different effects on both sets of passengers, but then I think for the top elites flying internationally, many also fly domestically. Regardless, I see no reason why one would not look at both domestic and international Loads/profitability metrics to know if the current approach is working. The ability to attract premium traffic is the broader issue, and the complaints/issues don't just effects folks with MP status. The loss of a $10K C fare is a loss, wither its to a MP member or someone who is not.

And since you main point is that international is (so you allege) effected more by international conditions, that is why UA's PRASM is compared to other global airlines (DL and AA). Its the relative spread that one looks at to see how UA is stacking up, not the absolute numbers. I've posted these absolute numbers elsewhere, as you know. No surprise UA is doing poorly compared to other airlines.

obviously if you wanted to see how UA was stacking up to SW or JetBlue or US with its lighter international footprint) then you might look at the domestic PRASM numbers, but I don't think that is your point.
You make some interesting insights. Why should I bother to respond when no one is really interested in reading what I have to say because of something I may have posted in the past.
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