United CFO Rainey Implies Certain Elites were "Over Entitled".
#1561
Join Date: Nov 2007
Location: Washington DC
Programs: Former 1k, Lifetime UA Gold, Starwood Gold; Avis Preferred; Hertz Gold
Posts: 1,732
http://seekingalpha.com/article/7193...ng-unwarranted
Apparently modeling UAL RASM gains just above 2% in the second half.
#1562
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
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.
http://seekingalpha.com/article/7193...ng-unwarranted
Apparently modeling UAL RASM gains just above 2% in the second half.
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.
#1563
Join Date: Dec 2006
Location: Izamal, Yucatan
Programs: Previously 5 year AS Gold 75, UA MM Lifetime Gold
Posts: 787
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...
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...
Hopefully they'll be in the next wave of thousands...
#1564
Join Date: Nov 2010
Location: DEN
Programs: 2012 Plat-2013 Plat-2014 Silver-2015 GM
Posts: 818
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.
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.
#1565
Join Date: Oct 2003
Location: DCA
Programs: UA LT 1K, AA EXP, Bonvoy LT Titan, Avis PC, Hilton Gold
Posts: 9,658
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
#1566
Join Date: Dec 2006
Location: Izamal, Yucatan
Programs: Previously 5 year AS Gold 75, UA MM Lifetime Gold
Posts: 787
..
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)
.
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)
.
#1567
Join Date: Nov 2010
Location: DEN
Programs: 2012 Plat-2013 Plat-2014 Silver-2015 GM
Posts: 818
Should the US-AA merger ever occur, at least they will have a historical business template for what not to do.
#1568
Join Date: Dec 2006
Location: Izamal, Yucatan
Programs: Previously 5 year AS Gold 75, UA MM Lifetime Gold
Posts: 787
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!
#1569
Join Date: Nov 2010
Location: DEN
Programs: 2012 Plat-2013 Plat-2014 Silver-2015 GM
Posts: 818
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.
#1570
Join Date: Apr 2008
Posts: 2,358
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.
-
#1571
FlyerTalk Evangelist
Join Date: Mar 2010
Location: DAY
Programs: UA 1K 1MM; Marriott LT Titanium; Amex MR; Chase UR; Hertz PC; Global Entry
Posts: 10,159
They have been pretty clear that this was only for 2012 expiring GPUs.
Proceed cautiously.
#1572
Join Date: Nov 2007
Location: Washington DC
Programs: Former 1k, Lifetime UA Gold, Starwood Gold; Avis Preferred; Hertz Gold
Posts: 1,732
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
#1573
Join Date: Jul 2005
Posts: 2,324
[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.
#1574
Join Date: Nov 2005
Location: SFO and OAK
Programs: FAF, Hyatt <>, SPG PLT
Posts: 2,240
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...
Hopefully they'll be in the next wave of thousands...
#1575
Join Date: Apr 2008
Posts: 2,358
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/
-
Last edited by FlyinHawaiian; Jul 16, 2012 at 5:07 am Reason: fix html