There is a plethora of financial and operational reasons why the United Airlines that exits bankruptcy early next month will soon enough be back in Chapter 11 or desperately seeking a merger to keep itself afloat.
But United Airlines will fail again primarily because it has no organizational heart, no identity and no definable brand. Most of all, it has none of the vision and discipline that separates the winners from the losers in the deregulated skies.
Consider the airlines that have had success of any meaningful duration in the last decade. There is, of course, Southwest Airlines. Whether you like what it sells is beside the point: You know and understand the product that it sells. And you know that Southwest delivers it at every seat on every flight on every route that it operates. Southwest's management and employees are fanatically devoted to its standards of simplicity and its unabashedly mass-transit approach to air travel.
Ditto JetBlue Airways. You know what you buy every time: a leather chair with decent legroom; free in-flight satellite TV and radio; a sense of casual style; and rational prices. AirTran Airways has found success because it offers a definable and recognizable product: no-frills, two-class service at simple prices. It even did the unthinkable—dump commuter flights—because they did not fit the image or the financial model. And before its corporate ego ran amok, Continental Airlines had a profitable run. Why? It crafted a demonstrably higher quality of "traditional" full-service flying and then reworked its management, crews, fleet and operations until the airline was a consistent and marketable whole.
United has done none of those things during its 38 months in Chapter 11. In a market that has proven it will only support consistency, United Airlines is a bizarre amalgam of in-flight products, fleet configurations and service concepts. It cynically tries to be all things to all fliers and careens from idea to idea, cabin to cabin and fare to fare, sometimes on a route-by-route basis.
In fact, United isn't. Not in concept or in execution. It is a disjointed collection of flights run by executives with no overarching vision, no unifying commitment and no marketing or brand discipline. In every conceivable way, United is the opposite of what works in the sky.
United will emerge from the most costly bankruptcy in American history with 26 separate in-flight seat configurations. It dabbles in everything from the upmarket p.s. service to the downmarket Ted. It slaps its name and logo on five types of narrow-body planes, four types of widebody jets and eight flavors of regional aircraft. It befuddles buyers with an ever-shifting combination of one, two, three and even four classes of in-flight service. And like all of the Big Six, its rococo fare structure is repulsive.
It is, simply put, an unholy mess competing in an unforgiving marketplace that only spares carriers with impeccable systemwide coherency.
United's intellectually slovenly approach to air travel guarantees its failure. But it's not just theory: United exits bankruptcy as a textbook example of worst-case practices. Consider:
• United's oil-price projections are fantasy. The five-year plan that United submitted to its bankruptcy court predicts annual operating profits through 2010. But its projections are based on oil selling for an average of $50 a barrel. The market price of oil is currently north of $65 a barrel. Given the growing demands of China and India and the upheavals in Iran and Nigeria, oil could be closer to $100 a barrel than $50 in the next five years. In fact, last week at the World Economic Forum in Switzerland, experts contemplated the mechanics of a global economy with $120-a-barrel oil.
Rest of the article here:
http://www.usatoday.com/travel/columnist/b...ancatelli_x.htm
But United Airlines will fail again primarily because it has no organizational heart, no identity and no definable brand. Most of all, it has none of the vision and discipline that separates the winners from the losers in the deregulated skies.
Consider the airlines that have had success of any meaningful duration in the last decade. There is, of course, Southwest Airlines. Whether you like what it sells is beside the point: You know and understand the product that it sells. And you know that Southwest delivers it at every seat on every flight on every route that it operates. Southwest's management and employees are fanatically devoted to its standards of simplicity and its unabashedly mass-transit approach to air travel.
Ditto JetBlue Airways. You know what you buy every time: a leather chair with decent legroom; free in-flight satellite TV and radio; a sense of casual style; and rational prices. AirTran Airways has found success because it offers a definable and recognizable product: no-frills, two-class service at simple prices. It even did the unthinkable—dump commuter flights—because they did not fit the image or the financial model. And before its corporate ego ran amok, Continental Airlines had a profitable run. Why? It crafted a demonstrably higher quality of "traditional" full-service flying and then reworked its management, crews, fleet and operations until the airline was a consistent and marketable whole.
United has done none of those things during its 38 months in Chapter 11. In a market that has proven it will only support consistency, United Airlines is a bizarre amalgam of in-flight products, fleet configurations and service concepts. It cynically tries to be all things to all fliers and careens from idea to idea, cabin to cabin and fare to fare, sometimes on a route-by-route basis.
In fact, United isn't. Not in concept or in execution. It is a disjointed collection of flights run by executives with no overarching vision, no unifying commitment and no marketing or brand discipline. In every conceivable way, United is the opposite of what works in the sky.
United will emerge from the most costly bankruptcy in American history with 26 separate in-flight seat configurations. It dabbles in everything from the upmarket p.s. service to the downmarket Ted. It slaps its name and logo on five types of narrow-body planes, four types of widebody jets and eight flavors of regional aircraft. It befuddles buyers with an ever-shifting combination of one, two, three and even four classes of in-flight service. And like all of the Big Six, its rococo fare structure is repulsive.
It is, simply put, an unholy mess competing in an unforgiving marketplace that only spares carriers with impeccable systemwide coherency.
United's intellectually slovenly approach to air travel guarantees its failure. But it's not just theory: United exits bankruptcy as a textbook example of worst-case practices. Consider:
• United's oil-price projections are fantasy. The five-year plan that United submitted to its bankruptcy court predicts annual operating profits through 2010. But its projections are based on oil selling for an average of $50 a barrel. The market price of oil is currently north of $65 a barrel. Given the growing demands of China and India and the upheavals in Iran and Nigeria, oil could be closer to $100 a barrel than $50 in the next five years. In fact, last week at the World Economic Forum in Switzerland, experts contemplated the mechanics of a global economy with $120-a-barrel oil.
Rest of the article here:
http://www.usatoday.com/travel/columnist/b...ancatelli_x.htm
