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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, 4:53 pm
  #1561  
 
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Originally Posted by BlackMountain
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.
Yep. And Goldman initiated a *sell* on Thursday. I disagree with the author here, but the headwinds for UAL are significant going forward.

http://seekingalpha.com/article/7193...ng-unwarranted

Apparently modeling UAL RASM gains just above 2% in the second half.
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Old Jul 15, 2012, 5:56 pm
  #1562  
 
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Originally Posted by DCEsquire
Yep. And Goldman initiated a *sell* on Thursday. I disagree with the author here, but the headwinds for UAL are significant going forward.

http://seekingalpha.com/article/7193...ng-unwarranted

Apparently modeling UAL RASM gains just above 2% in the second half.
I think that this piece (and note he is long on UAL, guy writes this drivel to pump stocks) is entirely emblematic of why UA has a lot of time from the markets. He is spouting the "cut costs, better AC utilization" line of management. Absolutely nothing on the brand equity/demand side. But these things are harder to quantify, and most analysts don't look much beyond the superficial numbers.

Anyway, UALs PRASM sucked from 2002-2006/7 compared to others, and those who have been around know why (melt down in 2000 drove away lots of traffic). But I have never been one to think the market will quickly cause changes.
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Old Jul 15, 2012, 7:35 pm
  #1563  
 
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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'm right there with you. I'm still getting everything I've been told I would....well, OK, I missed one UG in the last six months.

Originally Posted by dgcpaphd
With all due respect, I hope you realize one probable reason for your upgrade success.

Thousands of UA elites abandoned UA and took the status match at AA. Of course, this removes those elites competing for upgrades. Consequently, your being treated "right" by UA is merely a fallout from fewer customers competing for the same seats...
You may be right about this, but there are also thousands more who will be taking their places soon...and will love the new program as they get to know it. I wonder if there's a correlation between the thousands you're refering to and the group of elites the CFO was referring to?

Originally Posted by dgcpaphd
...On the other hand, many UA customers are not happy with the new UA management as is obvious from reading this forum.
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Hopefully they'll be in the next wave of thousands...
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Old Jul 15, 2012, 8:03 pm
  #1564  
 
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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.
spin- love your numbers analysis. Obviously quite comfortable with airline metrics along with Balance Sheet and Income Statement recording. Keep it up. We're looking for the "customers" perspective.
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Old Jul 15, 2012, 8:07 pm
  #1565  
 
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Originally Posted by mmack
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.
These were 4 GPUs expiring Sept 2012, which I had extended to Dec 2012. I used them for a 950 mile nonstop flight on UA for two of us, Roundtrip.

I am pretty much flying AA now (instead of UA). Nothing against UA - I have a trip to HNL in Nov on UA, just that now that I am flying AA - I like AA better:

- Better seat in F (seats slide forward - so no steep incline into your seat from the seat in front),
- 98% upgrade rate (always upgraded out of DCA),
- meals in F on shorter flights - like DCA-ORD at meal time (UA serves a junk food basket),
- longer spread of time for meal service flights (UA has narrower meal time ranges)
- free drinks and free food in coach as EXP (if you are ever in coach), so don't need drink coupons
- SWU work on any fare,
- no TODs (you buy instant F upgrade fare at ticket time, if available),
- availability of Costco 10% coupons, etc.
- fancier, larger lounges (like at LAX, SFO, DFW, etc)

I will have 200K EQM on AA (and less than 50K on UA) this year. I will still fly UA - just not as much. If AA and US merge - it becomes over 60% of DCA airport flights.

Last edited by cova; Jul 15, 2012 at 8:21 pm
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Old Jul 15, 2012, 8:17 pm
  #1566  
 
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Originally Posted by cova
..

Better seat in F,
- 98% upgrade rate (always upgraded out of DCA),
- meals in F on shorter flights - like DCA-ORD at meal time (UA serves a junk food basket),
- free drinks and free food in coach as EXP (if you are ever in coach),
- SWU work on any fare,
- no TODs (you buy instant F upgrade fare at ticket time, if available),
- availability of Costco 10% coupons, etc.
- fancier, larger lounges (like at LAX, SFO, DFW, etc)
.
Definitely cool stuff...hopefully it will still be around when they exit bankruptcy...or dare I say...merge. Might depend on what Smisek...er, I mean Parker has to say about it.
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Old Jul 15, 2012, 8:51 pm
  #1567  
 
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Originally Posted by emcsweeney
Definitely cool stuff...hopefully it will still be around when they exit bankruptcy...or dare I say...merge. Might depend on what Smisek...er, I mean Parker has to say about it.
Should the US-AA merger ever occur, at least they will have a historical business template for what not to do.
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Old Jul 15, 2012, 8:59 pm
  #1568  
 
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Originally Posted by ibuyyoufly
Should the US-AA merger ever occur, at least they will have a historical business template for what not to do.
From a merger process/planning/implementation standpoint, I completely agree. However, I also think there might be 'thousands and thousands' of disillusioned AA elites looking for greener pastures...at UA!
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Old Jul 15, 2012, 9:12 pm
  #1569  
 
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Originally Posted by emcsweeney
From a merger process/planning/implementation standpoint, I completely agree. However, I also think there might be 'thousands and thousands' of disillusioned AA elites looking for greener pastures...at UA!
That could be very true. Our air travel choices might just come down to not wanting to fly the Brand that is the last worst offender. At least we get to spread the money around until someone shows the desire and aptitude to be the true winner.
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Old Jul 15, 2012, 9:27 pm
  #1570  
 
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Originally Posted by ibuyyoufly

Should the US-AA merger ever occur, at least they will have a historical business template for what not to do.
Given the disastrous results of the UA/CO takeover, I doubt that any government agency would permit another merger of two more major air carriers.

Competition is critical in public transportation. Mergers reduce competition.

Like the other poster said, if another merger happens (probably won't), the parties will know what NOT to do.

A "merger of equals" is what was repeatedly announced prior to UA & CO merging. We all know what happened to the UA side and to the credibility of the new UA management.

Hopefully, never again will that happen.
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Old Jul 15, 2012, 9:57 pm
  #1571  
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Originally Posted by cova
These were 4 GPUs expiring Sept 2012, which I had extended to Dec 2012. I used them for a 950 mile nonstop flight on UA for two of us, Roundtrip.
<snip>
Just FYI, this does not mean that 2013 GPU extensions are a sure thing. I had to fight hard, through many levels of UA staff, to get 2012 GPU extended by 4 days....and this was something they had already committed to some time ago.

They have been pretty clear that this was only for 2012 expiring GPUs.

Proceed cautiously.
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Old Jul 15, 2012, 10:15 pm
  #1572  
 
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Originally Posted by dgcpaphd
Given the disastrous results of the UA/CO takeover, I doubt that any government agency would permit another merger of two more major air carriers.
Government regulators *rarely* ever block deals and usually seek conditions. I don't see any reason this deal would get blocked. Conditions perhaps.

Last edited by FlyinHawaiian; Jul 16, 2012 at 5:06 am Reason: fix html
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Old Jul 16, 2012, 2:03 am
  #1573  
 
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Originally Posted by spin88

Anyway, UALs PRASM sucked from 2002-2006/7 compared to others, and those who have been around know why (melt down in 2000 drove away lots of traffic). But I have never been one to think the market will quickly cause changes.
Moreso a route network that suffered disproportionately against peers given the higher exposure to markets affected by business spend. See the disproportionate PRASM growth as that spend recovered.

[Unduly personalized text deleted by Moderator per FT Rules.]

Last edited by Ocn Vw 1K; Jul 16, 2012 at 9:31 am Reason: Please see above.
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Old Jul 16, 2012, 4:04 am
  #1574  
 
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Originally Posted by emcsweeney
You may be right about this, but there are also thousands more who will be taking their places soon...and will love the new program as they get to know it. I wonder if there's a correlation between the thousands you're refering to and the group of elites the CFO was referring to?



Hopefully they'll be in the next wave of thousands...
Probably about time to rename flyertalk.com to MyCultIsBetterThanYours.com
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Old Jul 16, 2012, 4:16 am
  #1575  
 
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Originally Posted by DCEsquire
Government regulators *rarely* ever block deals and usually seek conditions. I don't see any reason this deal would get blocked. Conditions perhaps.
Just a few months ago the feds blocked a merger between T-Mobile and AT&T giving the excuse that the merger would reduce competition.

I don't see this decision any different than if it applied to two major airlines such as AA and US.

http://abcnews.go.com/blogs/technolo...hone-networks/

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Last edited by FlyinHawaiian; Jul 16, 2012 at 5:07 am Reason: fix html
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