An article published in Bloomberg Businessweek magazine takes a closer look at how United Airlines’ is attempting to turn things around after the issues that came after the merger with Continental Airlines. The merger took place five years ago, and at the time Continental had some of the highest customer-satisfaction ratings. After the merger things seemed to spiral—“the new United” ended up losing money, while other airlines were reporting record profits in 2012 and 2014.
Customers were frustrated from repeated reservation system glitches, lost baggage and increased baggage costs, late arrival times and other general customer service issues. One major issue came up last year when then-CEO Jeff Smisek abruptly resigned after it was investigated that Smisek had improperly influence the Port Authority of New York & New Jersey, which operates the region’s major airports.
Smisek was replaced by Oscar Munoz, quickly and publicly pledged changes in an open letter introducing himself to the company's workers.
"At United, I will dedicate myself to making our airline flyer-friendly," Munoz said last fall in the letter. “We will give you the right tools to deliver the service and reliability I know we are capable of.”
Munoz, who had sparked optimism when he took over as CEO, was hospitalized for a heart attack last October. He was originally slated to return during the first quarter of the year, but it was announced earlier this month that Munoz had undergone a heart transplant. The company said it expects Munoz to be back at work by this summer, though many industry observers have wondered if such a quick return is possible.
While Munoz recovers, Brett Hart – United’s general counsel – is serving as interim CEO.
Like Munoz, he admits the company has had a rough run. But he’s also adamant United is continuing to sort itself out – just as Munoz envisioned.
“We’ve been out front acknowledging that, ‘Hey, it would have been great to get it together before year five,’ ” Hart says to Bloomberg Businessweek.
There are early signs of progress. United’s recent numbers for on-time flights and baggage handling have been some of the best since the United-Continental merger in 2010. The company had also been making flier-friendly changes, which have begun to put United on the right path.
Free snacks are now back for coach-class passengers. The carrier handed out bottles of water to holiday fliers as they boarded planes last month as a gesture of goodwill. Fox Sports 1 personality Katie Nolan stars in "Big Metal Bird," a new web video series United hopes will engage customers in a less buttoned-down style than has been the company's trademark. And United has even tabbed the upscale Illy coffee brand to replace its previous coffee, which had been unpopular with fliers.
“People see the planes coming in and going out on time,” Hart says to Bloomberg Businessweek. “Employees’ interactions with customers are different. Our customers’ response to the service is improving. People are saying, ‘You know, this feels like a new day.’"