CEO Jeff Smisek Out;Oscar Munoz new Pres/CEO,Henry Meyer non-ex Chair;FBI case closed
Sep 8, 2015, 9:50 pm
#406
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Munoz looks like Kevin Spacey. Net positive if he turns out to be American Beauty Spacey. Net negative if he turns out to be House of Cards Spacey.
Sep 8, 2015, 10:02 pm
#407
Used to be 'jwienner'
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Sep 8, 2015, 10:05 pm
#408
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UACO Screenplay from the Boeing Novel...
deleted
Last edited by cyborg; Jun 2, 2018 at 10:56 am Reason: Moving on from Flyertalk
Sep 8, 2015, 10:06 pm
#409
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Do you mean this BYE?
Sep 8, 2015, 10:16 pm
#410
Join Date: Feb 2002
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While not exactly the same, this reminds me of the Boeing situation about 12 years ago when the CEO Phil Condit resigned after the USAF Tanker scandal where CFO Sears and the USAF acquisition official ended up doing jail time. Condit's resignation was more likely due to poor performance after some mega mergers (Hughes, Rockwell, McDonnell Douglass) didn't produce the desired results from defense contracts at a time when Airbus was eating into Boeing's commercial business.
Another thought is where the story leads on the NYNJPA CEO side since he's a good buddy of C2 or is that a bridge too far?
V/r,
-Cyborg
Another thought is where the story leads on the NYNJPA CEO side since he's a good buddy of C2 or is that a bridge too far?
V/r,
-Cyborg
Condit was a true larger than life guy of extravagance.
Jeff - not so much. If anything perhaps he turned out to be not slick enough.
This sums it up well
"But if strategic blunders and failures to execute can be overlooked by a board, scandal can't be. Not when you're a defense contractor. A snowballing ethics problem threatened to imperil the side of Boeing's business that was still growing and healthy: its lucrative government contracts. In the end, that's what did Condit in."
http://www.bloomberg.com/bw/stories/...eally-happened
Similar at UA. He wasn't going anywhere unless something like this came up....or the labor deals got done and he could hand over the reigns to a 'good cop.'
And yeah, this story is being set up as a road to C2...even though C2 is no longer the force he was.
Sep 8, 2015, 10:23 pm
#411
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The interesting part will be the results of the investigation.
Sep 8, 2015, 10:24 pm
#412
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First word from the pilots - use Google to get behind the WSJ paywall:
http://www.wsj.com/articles/united-c...ure-1441765672
http://www.wsj.com/articles/united-c...ure-1441765672
Capt. Jay Heppner, chairman of the leadership council of the Air Line Pilots Association branch at United, said in a message to his 12,500 members Tuesday that Mr. Munoz “has impeccable credentials in the business world, along with a track record of working with labor on many levels.”
The pilot chief, who also serves on United’s board and is a frequent critic of the company, said his group welcomes the chance to work with Mr. Munoz and his team to build “from a new perspective, a culture at United Airlines where management and employees work together for the betterment of our airline.”
The pilot chief, who also serves on United’s board and is a frequent critic of the company, said his group welcomes the chance to work with Mr. Munoz and his team to build “from a new perspective, a culture at United Airlines where management and employees work together for the betterment of our airline.”
Sep 8, 2015, 10:26 pm
#413
Join Date: Feb 2008
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Absolutely Northwest and UA were very similar in their problems coming in.
What Delta did differently from the start...
- 7 of 11 board members came from the Delta side
- Ed Bastian from Delta immediately became CEO of the Northwest subsidiary
- They hired Anderson beforehand, who was from the NW side and knew all the skeletons
- Only the CTO remained from the Northwest senior management team
It was without question Delta acquiring Northwest in every sense of the word.
Once it was clear who was in charge, then they started listening and melding.
United / Continental, for whatever reason - went with a senior team that was initially 50/50 by design. Tilton remained chairman, while Smisek was CEO. I get the impression United forced that as a condition of the merger.
http://articles.chicagotribune.com/2...nd-continental
Heck the company name is still not one.
Delta has done many other very smart things after this foundation was laid, but we can't underestimate how valuable it was for Anderson to have been a leader of NW beforehand, navigating those dangerous alleys, and clearly in charge with a Delta mandate.
Had United clearly acquired Continental, or the reverse from the start, we could have had a very different outcome.
I will also add AA/US is very clearly US taking over. Only 3 people on the senior management team are from the AA side. CTO, govt affairs, and a temporary integration head.
http://www.aa.com/i18n/amrcorp/corpo.../bios/main.jsp
NW had very strong fortress hubs, and other than on Japan connections (from UA) little competition in the regions where it was located. It had good operational performance (I know, I flew both, NW was on time, CO not so much...) but very very bad hard and soft product. Food/seats sucked, planes were dark. Really sad. NW pulled in passangers with (1) fortress hubs, (2) upgrades, and (3) a decent FF program.
DL had much more competitive hubs (ATL and JFK both had major competition), and generally much better service and product quality. Bad Operational performance, and SkyPesos.
DL (ex-NW) management knew that if they cut NW FF benefits, elites would not bolt, they had no place to go. DL knew that if they cut product quality and service DL elites would bolt. So they went for better hard/soft product (catering, blankets, pillows to DL standard) and better OT, but then went with SkyPeso. It has worked out well for them.
CO though had fortress hub flyers and a sucky mileage program (nonepass) with few benifits. No SWUs, upgrades did not happen, no E+. CO did not need a FF program people had to fly them. They they offered an ok level of service, but bad IRROPs. UA faced much more competition, and therefore offered a lot of FF benifits and very good GS for elite travelers. Product was not great, but was improving in 2010 time frame.
But faced with this competitive landscape, CO cut FF benifits for UA fliers, raised them for CO flyers, upsetting those with options. Then CO devalued the product dramatically, upsetting everyone, particularly the sUA fliers with things like vending machine coffee from H-town. CO then cut operational performance to try to squeeze more flights out of the fleet. CO took away things like wide bodies UA folks were used to. The folks with Options - sUA fliers - got the cuts, they were not balanced in any way.
That was a very bad plan.
Bloomberg seems to be tacking over toward your hypothesis that corruption probe plus growing list of under-performance issues 4 years after the merger.
http://www.bloomberg.com/news/articl...rruption-probe
while asleep at the wheel may be too strong, the fact he was Chairman, President an CEO implies to me that it was clearly going to be very difficult to push him out and that they were obviously inclined to give him a lot of leeway to run the show without a lot of interference fitting with the top down "yes sir" /"my way or the highway" culture he brought over.
When the airline is this visibly bad and in the news regularly for minor issues like a flight diversion or system back up that get spectacularly out of hand in one of the best airline business environments in almost 20 years, it's not hard for me to agree that some savvy board members used this as the air cover to make a move to try to right the ship before it's too late.
http://www.bloomberg.com/news/articl...rruption-probe
while asleep at the wheel may be too strong, the fact he was Chairman, President an CEO implies to me that it was clearly going to be very difficult to push him out and that they were obviously inclined to give him a lot of leeway to run the show without a lot of interference fitting with the top down "yes sir" /"my way or the highway" culture he brought over.
When the airline is this visibly bad and in the news regularly for minor issues like a flight diversion or system back up that get spectacularly out of hand in one of the best airline business environments in almost 20 years, it's not hard for me to agree that some savvy board members used this as the air cover to make a move to try to right the ship before it's too late.
Last edited by WineCountryUA; Sep 8, 2015 at 11:54 pm Reason: Discuss the issues, not the posters; language
Sep 8, 2015, 10:36 pm
#414
Join Date: Feb 2002
Location: NYC: UA 1K, DL Platinum, AAirpass, Avis PC
Posts: 4,599
The fundamental premise of having no clear acquirer was completely flawed.
Blame both boards for that.
I wish frequent flyer program generosity would have made a difference, but reality is none of that would have made the airline run reliably - which is really the biggest problem it has faced since the merger.
O'Toole was brought in by Tilton to be the hatchet man for MileagePlus...change was coming there regardless.
Blame both boards for that.
I wish frequent flyer program generosity would have made a difference, but reality is none of that would have made the airline run reliably - which is really the biggest problem it has faced since the merger.
O'Toole was brought in by Tilton to be the hatchet man for MileagePlus...change was coming there regardless.
I think its important to understand the very different competitive postures the airlines were in.
NW had very strong fortress hubs, and other than on Japan connections (from UA) little competition in the regions where it was located. It had good operational performance (I know, I flew both, NW was on time, CO not so much...) but very very bad hard and soft product. Food/seats sucked, planes were dark. Really sad. NW pulled in passangers with (1) fortress hubs, (2) upgrades, and (3) a decent FF program.
DL had much more competitive hubs (ATL and JFK both had major competition), and generally much better service and product quality. Bad Operational performance, and SkyPesos.
DL (ex-NW) management knew that if they cut NW FF benefits, elites would not bolt, they had no place to go. DL knew that if they cut product quality and service DL elites would bolt. So they went for better hard/soft product (catering, blankets, pillows to DL standard) and better OT, but then went with SkyPeso. It has worked out well for them.
CO though had fortress hub flyers and a sucky mileage program (nonepass) with few benifits. No SWUs, upgrades did not happen, no E+. CO did not need a FF program people had to fly them. They they offered an ok level of service, but bad IRROPs. UA faced much more competition, and therefore offered a lot of FF benifits and very good GS for elite travelers. Product was not great, but was improving in 2010 time frame.
But faced with this competitive landscape, CO cut FF benifits for UA fliers, raised them for CO flyers, upsetting those with options. Then CO devalued the product dramatically, upsetting everyone, particularly the sUA fliers with things like vending machine coffee from H-town. CO then cut operational performance to try to squeeze more flights out of the fleet. CO took away things like wide bodies UA folks were used to. The folks with Options - sUA fliers - got the cuts, they were not balanced in any way.
That was a very bad plan.
The bloomberg piece is well done, and by an author who knows UA well. I think this message will be more traction as I think it best reflects the underlying reality. Unless Jeff was going way in cuffs, you don't fire the CEO for corruption, unless you are unhappy with his performance. CEOs get away with lots (see "give me another drink Parker") provided they are delivering the $$$$. Jeff was not...
NW had very strong fortress hubs, and other than on Japan connections (from UA) little competition in the regions where it was located. It had good operational performance (I know, I flew both, NW was on time, CO not so much...) but very very bad hard and soft product. Food/seats sucked, planes were dark. Really sad. NW pulled in passangers with (1) fortress hubs, (2) upgrades, and (3) a decent FF program.
DL had much more competitive hubs (ATL and JFK both had major competition), and generally much better service and product quality. Bad Operational performance, and SkyPesos.
DL (ex-NW) management knew that if they cut NW FF benefits, elites would not bolt, they had no place to go. DL knew that if they cut product quality and service DL elites would bolt. So they went for better hard/soft product (catering, blankets, pillows to DL standard) and better OT, but then went with SkyPeso. It has worked out well for them.
CO though had fortress hub flyers and a sucky mileage program (nonepass) with few benifits. No SWUs, upgrades did not happen, no E+. CO did not need a FF program people had to fly them. They they offered an ok level of service, but bad IRROPs. UA faced much more competition, and therefore offered a lot of FF benifits and very good GS for elite travelers. Product was not great, but was improving in 2010 time frame.
But faced with this competitive landscape, CO cut FF benifits for UA fliers, raised them for CO flyers, upsetting those with options. Then CO devalued the product dramatically, upsetting everyone, particularly the sUA fliers with things like vending machine coffee from H-town. CO then cut operational performance to try to squeeze more flights out of the fleet. CO took away things like wide bodies UA folks were used to. The folks with Options - sUA fliers - got the cuts, they were not balanced in any way.
That was a very bad plan.
The bloomberg piece is well done, and by an author who knows UA well. I think this message will be more traction as I think it best reflects the underlying reality. Unless Jeff was going way in cuffs, you don't fire the CEO for corruption, unless you are unhappy with his performance. CEOs get away with lots (see "give me another drink Parker") provided they are delivering the $$$$. Jeff was not...
Last edited by WineCountryUA; Sep 8, 2015 at 11:55 pm Reason: Quote update to reflect Mod edit
Sep 8, 2015, 10:52 pm
#415
Join Date: May 2010
Posts: 23
SmExit /J
I have not spent a single penny, NOT ONE, on United, since being called "over-entitled" and 'demoted' to Platinum.
That's after more than 20 years of being a 1K, mostly on my own money.
So for three-and-a-half years I have read FlyerTalk daily, looking for a thread such as this: hooray and hooray again, I say!
Now, will Munoz want my money?
Calling ozstamps, UrbaneGent et al .....
That's after more than 20 years of being a 1K, mostly on my own money.
So for three-and-a-half years I have read FlyerTalk daily, looking for a thread such as this: hooray and hooray again, I say!
Now, will Munoz want my money?
Calling ozstamps, UrbaneGent et al .....
Last edited by 22H; Sep 8, 2015 at 11:03 pm Reason: link
Sep 8, 2015, 10:53 pm
#416
Join Date: Oct 2013
Programs: GS, Hilton Gold, Marriott Gold, *gold
Posts: 121
In unexpected news....
UAL now will actually care about customers, carrots and bananas be damned!
It's scotch and top shelf liquor for all!
Oh wait that is just customers we care about, no wait Jeffrey is going to jail! No wait he is more slippery than a politician! He gets healthcare and free flights till retirement! Pull the ripcord let's make sure he sits back of a erj 145!!!!
It's scotch and top shelf liquor for all!
Oh wait that is just customers we care about, no wait Jeffrey is going to jail! No wait he is more slippery than a politician! He gets healthcare and free flights till retirement! Pull the ripcord let's make sure he sits back of a erj 145!!!!
Sep 8, 2015, 10:56 pm
#417
FlyerTalk Evangelist
Join Date: May 2001
Posts: 10,965
You know what's most poetic about this situation? I've spent hours and hours and hours listening to $mi$ek's lectures where he rants against the US Government and he rants against foreign carriers competing with him (and winning, of course). He says it's unfair. Unfair that the government regulates him. Unfair that the government taxes him to provide the infrastructure that let him make $14,000,000 a year. Unfair that foreign airlines get to compete with him.
And, then, he gets fired for alleged activities that have been described by major media outlets as corruption. That is, improperly influencing government officials to get benefits. Funny how it's fine for him to get special benefits but it's wrong for any other airline to get any benefits from their governments, and while he's allegedly bribing government officials for these benefits, he complains to us and the world about the fact that his company is taxed to pay for those benefits.
And, then, he gets fired for alleged activities that have been described by major media outlets as corruption. That is, improperly influencing government officials to get benefits. Funny how it's fine for him to get special benefits but it's wrong for any other airline to get any benefits from their governments, and while he's allegedly bribing government officials for these benefits, he complains to us and the world about the fact that his company is taxed to pay for those benefits.
This sounds to me like "friendly" extortion. Unless there exists the smoking gun of a quid pro quo, I don't see Smisek being a target. Smisek may only be a witness to the grand jury and a possible trial witness, forced to testify against Samson, if he (Samson) fails to make a plea deal.
However, that being said, he is embroiled in a Federal investigation, a fate that I wouldn't wish on anyone. While I despised his policy changes at United, they were made in the interests of improving profit margins. And, though I am happy to see him go, I have sympathy for his situation.
However, that being said, he is embroiled in a Federal investigation, a fate that I wouldn't wish on anyone. While I despised his policy changes at United, they were made in the interests of improving profit margins. And, though I am happy to see him go, I have sympathy for his situation.
It also says a lot about our government officials - close access to the bridge when they don't like the mayor, ask an airline to start a route for him...The total disregard for law and ethics. Imagine how many little unethical things they probably have done that we don't know about.
Sep 8, 2015, 11:02 pm
#418
Join Date: Feb 2012
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I believe this is a good thing for UA flyers. I think we can expect this point to be the bottom and hope that some things might get better from here and not getting worse. If Smisek were here it would only be getting worse. So not getting worse, is better. At least LAX is not a hub at risk now 
Sep 8, 2015, 11:03 pm
#419
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
The fundamental premise of having no clear acquirer was completely flawed.
Blame both boards for that.
I wish frequent flyer program generosity would have made a difference, but reality is none of that would have made the airline run reliably - which is really the biggest problem it has faced since the merger.
O'Toole was brought in by Tilton to be the hatchet man for MileagePlus...change was coming there regardless.
Blame both boards for that.
I wish frequent flyer program generosity would have made a difference, but reality is none of that would have made the airline run reliably - which is really the biggest problem it has faced since the merger.
O'Toole was brought in by Tilton to be the hatchet man for MileagePlus...change was coming there regardless.
I recall having a discussion c2012 with a very senior exec about the integration substantially cutting sUA benefits. I explained that unlike someone at IAH or EWR I could walk. He agreed, and admitted they might take a hit, but said "well we have to draw a line somewhere, so we are giving the CO folks more in the FF program and the UA folks less, they can deal with it.
Combine that attitude with a lot of anti-passenger changes, poor IRROPS, and devalued product and service, and you get to where UA is now.
And I don't believe the line that loyalty programs are dead. AA had a very successful one, kept folks from leaving in 2012 when their pilots decided to cause trouble. Today its still the best. Parker may cut it, but he may decide not to risk what happened to Jeff, and keep it as a safety blanket.
The programs get better when the airlines need them to attract traffic. DL does not need one now, UAL does, but it keeps pretending it does not...
Sep 8, 2015, 11:05 pm
#420
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Posts: 1,707
Employees hated Stephen Wolf as well, but he continued to fly for years on UA. Often transatlantic, he and his wife had a place in France.