United international route rumors

There have been a few rumors floating around that United Airlines might start some new international routes. Among them:

• Chicago - Moscow. Aeroflot used to fly this route but stopped in 2001, and United holds the dormant route authority for the route, which it obtained in a deal with Pan Am back in 1991. (If United did fly this route, it would probably skip Moscow's Sheremetyevo Airport (SVO) and instead fly to Domodedovo Airport (DME) because its fellow Star Alliance carriers fly there.) But the US-Russia market is currently served by a lot of routes - Delta flies Moscow - Atlanta and Moscow - New York (JFK), and Aeroflot flies Moscow - New York (JFK), Los Angeles, and Washington (IAD).
  
• Chicago - Milan. If United did fly this route, it would compete with Alitalia.
• Chicago - Düsseldorf. United used to fly this route but stopped in 2001. Star Alliance partner Lufthansa flies it with an Airbus A319, but is supposed to upgrade the route to an Airbus A330 in May.

It has also been rumored that United would upgrade some of its Boeing 767-300s, including a switch from a two-class domestic configuration to a three-class international one, and an engine upgrade. These upgraded 767s would be used on the route.

Forbes: America's Worst Airlines

Forbes magazine recently released a list of the country's "Worst Airlines", based upon flight delays, lost bags and cancellations. ASA came in worst, although Forbes noted that air traffic control is more likely to delay flights with fewer passengers, and because ASA flies smaller jets, they're more prone to being delayed. And weather was also a factor - several storms at Dallas affected American Eagle's performance, and Comair, which has a large presence in the Northeast, is also affected by severe weather. (Note that Hawaiian Airlines and Aloha Air aren't listed on the 'worst 10' - in fact, they're near the top for on-time performance, mostly due to a lack of severe weather.)

1. Atlantic Southeast Airlines: On-time performance: 63.3% (worst), Baggage mishandling: 16.9 per 1,000 passengers (worst), Cancellations: 4.4% (second worst)
2. Comair: On-time performance: 66.6% (second worst), Baggage mishandling: 11.9 per 1,000 passengers (third), Cancellations: 5.4% (worst)
3. American Eagle: On-time performance: 69% (fourth worst), Baggage mishandling: 13.5 per 1,000 passengers (second), Cancellations: 4.4% (third)
4. Mesa Airlines: On-time performance: 72.5% (seventh worst), Baggage mishandling: 10.1 per 1,000 passengers (fourth), Cancellations: 2.7% (sixth)
5. ExpressJet Airlines: On-time performance: 73% (ninth worst), Baggage mishandling: 8.9 per 1,000 passengers (fifth), Cancellation rating: 3.4% (fourth)
6. US Airways: On-time performance: 68.3% (third worst), Baggage mishandling: 8.6 per 1,000 passengers (seventh), Cancellations: 1.9% (ninth)
7. American Airlines: On-time performance: 69.9% (fifth worst), Baggage mishandling: 5.8 per 1,000 passengers (11th), Cancellations: 2.0% (eighth)
8. United Airlines: On-time performance: 72.4% (sixth worst), Baggage mishandling: 5.4 per 1,000 passengers (12th), Cancellations: 2.1% (seventh)
9. Delta Airlines: On-time performance: 75% (fifth worst), Baggage mishandling: 6.6 per 1,000 passengers (eighth), Cancellations: 1.5% (13th)
10. Alaska Airlines: On-time performance: 72.8% (eighth worst), Baggage mishandling: 6.6 per 1,000 passengers (ninth), Cancellations: 1.2% (15th)

United's "urge to merge"

The world of airline mergers has been buzzing since last week's report that United Airlines and Delta Airlines were being pushed by Pardus Capital Management (which owns a sizable stake in both airlines) to merge. Delta CEO Richard Anderson stated that "there have been no talks with United regarding any type of consolidation transaction and there are no such ongoing discussions." In a press release, Delta said that it "will not speculate on possible airline consolidation".

It's no secret that United has been shopping around for a merger partner for some time. They haven't bought any new planes in quite some time, and United has relatively thin profit margins and high debt.

That said, rumors have been flying for the last few years that United would find a merger partner. These partners have included Continental (which already said no) and Northwest (which wouldn't work out because the two airlines both have strong Midwest hubs) - almost everyone except American (a United-American merger couldn't happen because the combined airline would be too big). The latest to crop up on the aviation forums involves jetBlue, since the two airlines have complementary fleets/networks. United would use jetBlue as an opportunity to become a player again at JFK, which would tie in nicely with international feed from Star Alliance carriers and make it more competitive on the East Coast. And a United-jetBlue merger would also put an end to the fight at Washington-Dulles between the two airlines.

But a United-jetBlue merger isn't too likely, and any merger wouldn't be a cure-all fix for United. Even though United may be holding out on buying new planes to attract merger partners, they're going to need to upgrade eventually to keep up with competitors. And employee-management relations aren't very good, either. Merger or no merger, United really needs to address these issues (and others) if it wants to remain a viable competitor in the industry.

United pays investors while unions upset

United Airlines on Friday announced a $250 million onetime payout to shareholders, with management lauding the move highly. CEO Glenn Tilton announced that the payment, which will be given out at $2.15 a share, shows the airline’s “commitment to creating value for our investors… [United must] “compete for shareholders, just as we compete for customers.”Unions, rather unsurprisingly, gave a dim view of the payout, and said that the airline should be spending the extra cash on employees, rather than give it to investors. Mark Bathurst, head of the pilots union at United, said that “the battle lines have now been drawn…by its actions, [United management] has abandoned any pretense of working in partnership with its employees to make United strong and profitable.”

While it’s nice that United is in a financial situation that’s stable enough to be able to make these payouts, management ought to keep an eye on the unions, too. They have a valid point – United’s workers did sacrifice quite a bit during the airline’s stay in Chapter 11 bankruptcy. It’s time that employees got a little something back. Even a relatively small sum could be seen as a nice gesture on the part of management and would certainly be money well spent. United has had a history of antagonistic labor-management relations, and taking some money and spending it on employees could help improve things a bit.

Lufthansa to buy stake in jetBlue

JetBlue announced earlier today that Lufthansa would "make a minority equity investment" in jetBlue. The agreement between the two airlines states that Lufthansa will buy about 42 million newly issued shares of jetBlue (19% of the airline) at $7.27 a share, about $300 million. Lufthansa would also get a seat on jetBlue's Board of Directors. (Per US law, Lufthansa would be limited to under 25% voting rights.)

Lufthansa CEO Wolfgang Mayrhuber said that Lufthansa was "very pleased to become an investor in JetBlue" and that "this investment presents Lufthansa with a compelling opportunity to invest in the U.S. point-to-point carrier market as the industry continues to evolve." Dave Barger, jetBlue CEO, was pleased with "this significant endorsement of JetBlue's franchise from one of the most respected leaders in global aviation" and said that the investment "will also improve our balance sheet and give us greater financial flexibility as we move into 2008."

In a conference call this afternoon, it was revealed that Lufthansa was the one that approached jetBlue (sometime during the late summer). The deal should close sometime during the first quarter in 2008. This seems to have been the right time for Lufthansa to move in for a deal; shares of jetBlue are relatively cheap at the moment, and the airline could use some extra cash. jetBlue has had some trouble over the past years with high oil prices and increased competition (especially now that Virgin America's competing in the transcontinental market). Shares of jetBlue have fallen by half since last February's mess at JFK involving passengers stranded on planes for several hours, an event which damaged the airline's reputation. In addition, with the low value of the dollar versus the euro, Lufthansa's getting a pretty good bargain.

As of now, the two airlines haven't said that they would cooperate in any areas other than "operation cooperation". No code-share deal was announced, either, and besides, jetBlue's reservation system doesn't allow for code-sharing (at least not yet). If the airlines were to integrate schedules, Lufthansa would certainly benefit from US domestic feed at JFK. Then again, Lufthansa's premium passengers might not want to go from Lufthansa's premium classes of service to jetBlue's all-economy service (even if they do have DirecTV).

But there are still a few unanswered questions. Lufthansa is close partners with United Airlines and US Airways, all three of which are Star Alliance members. It's unknown if Lufthansa's US partners had any say-so in the deal or not, or what the potential ramifications of the deal are for the two. And there's no word yet if this could eventually lead to jetBlue becoming a Star Alliance member. United has been rumored to be interested in jetBlue as a potential merger partner, and if Lufthansa were to increase their stake to 25% and if United were to buy 26%, then the two airlines would have a controlling interest in jetBlue. Right now Lufthansa is limited to 25% ownership, like all foreign carriers, but if this cap is lifted (and with the Open Skies deal announced earlier this year, it might be soon), then Lufthansa might eventually purchase a controlling stake in jetBlue.

British Airways launches OpenSkies

Although it’s no secret that British Airways has been looking to expand in the transatlantic market, the airline made an announcement yesterday that it is starting an “airline within an airline”. OpenSkies, as the new entity is called, will start flying in June with a single Boeing 757-200 from New York to either Paris or Brussels. Another 757 is planned to join the fleet later this year, with six aircraft in all by 2009. In a statement, Willie Walsh, BA CEO, said that "by naming the airline OpenSkies, we're celebrating the first major step in 60 years towards a liberalized US/EU aviation market which means we can fly between any US and EU destination”. Future cities will probably include Milan, Frankfurt, Amsterdam, and Madrid.

This is a smart move on BA’s part – the Open Skies agreement signed between the US and the EU would add a lot of pressure at BA’s London Heathrow hub. Currently, only United Airlines, American Airlines, BA, and Virgin Atlantic can fly from the US into Heathrow, but this is expected to change soon as more US carriers add the airport. It’s also a smart idea that British Airways decided to buck the “premium transatlantic” trend that pushed MaxJet into bankruptcy last month – OpenSkies will have business class, premium economy, and economy class (each with 24, 28 and 30 seats, respectively). But BA isn’t alone in this area – British carrier bmi, Delta Air Lines, and Air France/KLM are all expected to follow suit with Heathrow-US routes.

Delta moves toward merger talks with United, Northwest

photo by Franco Folini

Delta Air Lines, which has reportedly been interested in a merger for some time now, has requested permission from its board to start "formal" merger discussions with United Airlines and Northwest Airlines soon, with a plan to choose one of the airlines with which to merge.

In the last few years, Delta has carried opposing views on mergers: it exited Chapter 11 bankruptcy last year after successfully fighting off a hostile takeover proposal from US Airways. But soon after leaving bankruptcy, it started exploring its merger options, and has been the target of merger rumors before (such as this past November, with United Airlines). And with a stagnant economy and oil prices at nearly $100 a barrel, mergers might help relieve some of the pressure that the US airline industry is feeling right now.

A Delta-Northwest or Delta-United deal would probably create the world's largest airline (currently American). So which airline could it be? Back in November, Northwest was (and still is) seen as the most likely candidate, because the route structures of the two airlines has less overlap. And Delta CEO Richard Anderson has ties with Northwest, having worked there for 14 years and ultimately rising to the rank of Northwest CEO. But the main problem with a Delta-Northwest tie-up is the fact that two hubs - Delta's Cincinnati and Northwest's Memphis - would probably be shut down, due to their close proximity to each other. This might create trouble from both unions and politicians.

The possibility of a combined Delta-United has been raised before, and United management has been advocating industry consolidation for quite some time. But it will be some time before any merger plans become concrete, and even then, they can still fall apart quite easily. But this time, it appears that the unions - at least at Delta - are more supportive of the merger idea than they have been in the past. Lee Moak, chairman of the Delta pilot's union, said in a letter that “consolidation may indeed be at our door... We do not oppose consolidation, and may even determine that consolidation is desirable.”

United would consider leaving Star Alliance

photo by striatic

According to United Airlines CEO Glenn Tilton, if United had to leave Star Alliance in order to finalize a merger, it was prepared to do so. "You can assume that absolutely everything goes into the mix of consideration," he said in a Chicago Tribune article published yesterday. The quote has sparked rampant speculation on internet forums as to whether or not United would actually seriously consider withdrawing from Star. United is one of Star's founding members, and is close partners with another founding member, Lufthansa. United makes a lot of money off of the feed that it gets from Star members (and vice versa).

There's no reaction yet from Lufthansa, arguably United's closest member. United does provide Lufthansa with a significant amount of connecting traffic, and losing United wouldn't be good. Lufthansa has covered its bases in the US market a bit with last year's investment in jetBlue, but jetBlue can't give them anywhere near the same amount of feed that United can. Perhaps Tilton's comments might be meant to scare Lufthansa into making an investment in United (as it did in jetBlue) - in this case, United's ties with Lufthansa and Star would probably be stronger than ever.

Of course, all of this is assuming that United is actually serious about leaving Star. United will probably remain in Star as long as it is financially viable; if a better alternative arises, United will probably do the sensible thing and 'go for it', even if this means dropping in Star in favor of another alliance. (A United-Delta or United-Continental merger might mean that the airline could join SkyTeam, but this seems more likely with the former.) For United, the most important item on the agenda is making money, and if this means merging with another carrier and leaving Star, then a United-less Star could indeed be a possibility.

United's luggage fees: a mixed bag

photo by kpishdadi

United Airlines recently announced that, "as part of its continuing effort to offer customers choice, flexibility, and low fares," it will start charging passengers who purchase nonrefundable economy tickets for US/Canada flights $25 to check a second bag (the first one is still free). Exempt from the fee are passengers who have Premier or higher status in Mileage Plus/Star Alliance will be able to go by the old rules of checking two bags for free.

This is certainly an interesting move by United - it's the first legacy carrier to introduce such a fee (discount airlines like Skybus have already made baggage fees an integral part of their business plans). Other legacies are no doubt paying careful attention to United's move here - if it works (i.e., passengers don't desert the airline), then it's probable that they'll follow suit and also charge more for bags. After all, by some estimates, United's move could make more than $100 million per year in extra revenue and cost savings - not an insignificant chunk of change.

So is United's move here good or bad? A bit of both, perhaps - a mixed bag (ha). They are running the very real risk of alienating some of its passengers, but this risk might diminish if the other legacies follow suit. And United might be able to convince some passengers that by not charging for bags that you're not going to check, they're passing the savings onto you...

Delta-Northwest, United-Continental mergers soon?

photo by Cubbie_n_Vegas

The Wall Street Journal is reporting that a merger deal between Delta Air Lines and Northwest Airlines could happen as soon as next week. Talks between the two were previously strained as the senior management of both carriers disagreed over whom would keep high-ranking management positions, but they have since come to an agreement.

As a result of Delta and Northwest's merger potential, merger discussions between United Airlines and Continental Airlines have also reportedly "grown more serious," said the article. United has proposed a merger with Continental before and has been turned down, but if Delta and Northwest announce a deal, Continental could change its mind very quickly and agree to merge with United, which has been actively looking for a merger partner for some time now.

An interesting point in all of these merger talks is Northwest's so-called "golden share" in Continental. This is basically some preferred stock that allows Northwest to abort a merger between Continental and another carrier. If Northwest and Delta do merger, however, Continental has the option to acquire the "golden share" for $100. Continental would be able to get the stock even if the Northwest-Delta deal later falls through.

The mergers raise a lot of inevitable questions - what types of aircraft will the combined operations operate (what will happen to Northwest's A330s)? Which hubs will stay open and which will close or be downscaled (Memphis, Cincinnati, etc.)? What international routes will be dropped or added? It's most likely that the answers to these questions will be worked out before the merger is announced (after all, it would be pretty stupid to merge first and then tackle those problems). As always, lots of things could happen. American Airlines, which is being left out of all of the "merger madness" at present, could intervene somehow. Labor unions or antitrust regulators could always prevent these mergers from going through (and with the size of these airlines, any mergers would get a high amount of scrutiny from the antitrust folks).

US Airways to start charging for bags

photo by Typophiles

Less than a month after United Airlines announced that it would be charging most passengers $25 to check a second bag, US Airways has announced that it would do the same, starting on May 1. US Airways claims that higher fuel costs are partly to blame and said that this new luggage fee will give the airline $100 million in additional revenue. It's a sign that the à-la-carte baggage trend is continuing throughout the major carriers - it's not unreasonable to say that by summer, virtually all of the majors will have adopted this fee.

And speaking of US Airways, the airline has been seeing some labor strife recently. Unions unveiled a 30-foot rat outside of the airline's headquarters, which supposedly symbolizes US Airways management. And CEO Doug Parker said that "our industry is in a mess, if you haven't noticed... we're about to head into what looks like another downturn."

United to downsize fleet

photo by Drewski2112

United Airlines, facing a slumping economy and rising fuel prices, announced today that it would ground 10 to 15 of its "older, less fuel efficient, narrowbody aircraft" as part of a plan "to offset what could be more than a $1 billion increase in fuel costs in 2008". "We are taking a prudent step now by reducing our fleet, taking assets out of the network that don't make sense at these fuel prices, to better position United to be successful in an ever-challenging environment," United CFO Jake Brace said. "United has an aggressive five-year plan focused on creating shareholder value. We have led the industry in reducing domestic capacity and continue to lead efforts to pass commodity costs onto our customers, as other industries do." As for which type United will ground: probably either some of the Boeing 737-300s and/or -500s.

Branson launches V Australian

As an Open Skies agreement between the United States and Australia takes effect, Richard Branson's newest addition to the Virgin fleet was announced earlier this week. V Australia, a division of Australian carrier Virgin Blue, will fly from Sydney to Los Angeles starting in December, competing with Qantas and United (which are the two airlines that currently fly the route). Branson said that "there is going to be very fierce competition, as there is with Virgin Blue and Qantas in Australia, and fares will definitely drop quite dramatically across this route... Our philosophy is never to go out with an empty seat."

Fares are relatively cheap - V Australia's return economy seats start at $1899. A special promotional round-trip fare of $777 for the first 1000 US passengers to book sold out quickly. In terms of aircraft, V Australia will start out with a single Boeing 777-300ER (it has ordered 6 total). Right now, Los Angeles is the only concrete destination, but the airline has also been interested in flying to Japan. It has also applied to the US Department of Transportation for approval to operate from Sydney to San Francisco, Las Vegas, Seattle, and New York.

US Airways CEO mentions mergers

photo by caribb

In a letter sent to employees yesterday, US Airways CEO Doug Parker said that "airlines are going to have to make dramatic changes" if they want to survive. Although he said that he couldn't "comment on any specific discussions or transaction," he said that the media have suggested that US Airways is in merger talks with United and that American would make a good match as well. "Rest assured," said Parker, "if US Airways chooses to participate in any industry consolidation, we will do so because we believe it is the best interests of our employees and our airline."

Would US Airways be a good match for United, which has been seeking out merger partners? They already code-share (a benefit that the Delta/Northwest combination has), and US Airways has a strong presence in the Northeast and Southeast (two areas where United's route structure is weaker). But I don't see US Airways' route network as being as much of a plus for an airline like United, which needs more international routes. Of the six largest legacy carriers, US Airways has the smallest international route network. United might prefer a rumored merger with Continental to one with US Airways.

US Airways still has problems of its own, too, from its last merger (between US Airways and America West). And let's not forget that the last time United and US Airways tried to merge, it was rejected by the Justice Department on anti-trust grounds.

By the way, here's the original message sent out by Parker (posted on the US Aviation boards):

From: Corporate Communications
Sent: Wednesday, April 16, 2008 8:36 AM
To: Corporate Communications
Subject: USNews Now: An Important Message from CEO Doug Parker
Importance: High

An Important Message from CEO Doug Parker

April 16, 2008

Dear Fellow Employees,

With the recent news of a potential Delta/Northwest merger, analysts and media are speculating about the next potential combination. While we had hoped to remain on the sidelines of this speculation, today’s Wall Street Journal suggests we may be in merger talks with United and another article in the Dallas Morning News suggests we might make a good merger partner for American.

While I can’t comment on any specific discussions or transaction I certainly didn’t want you to hear this speculation without hearing directly from me about what this might mean for US Airways.

Most of you know my views on consolidation and those have not changed. Our industry is far too fragmented and consolidation, if done properly, could result in a much healthier industry which would be good for our employees, our customers and the communities we serve. Rest assured if US Airways chooses to participate in any industry consolidation, we will do so because we believe it is the best interests of our employees and our airline.

Despite all of the challenges of merging two airlines, we are a much stronger company today as a result of the merger of US Airways and America West. We posted the highest pre-tax margin of the big six airlines in 2006 and even with our operational challenges we posted the second highest pre-tax margin in 2007.

And we have an improving airline. We’ve made great strides with our operational improvement plan, including top three performances in on-time arrivals for three consecutive months. As we continue through 2008, we feel extremely good about our ability to continue to improve our operational performance relative to the industry.

But we can't ignore what's happening in the world around us. Oil has risen to over $113 per barrel and Wall Street is anticipating a recession that, if it happens, will lower all airline revenues. And the DL/NW combination potentially creates a formidable competitor. In that world, all airlines are going to have to make dramatic changes to their existing business models in order to be viable.

I know airline merger speculation can be distracting so for now, I encourage all of us to remain focused on running a great airline. Our work on the reliability, convenience and appearance initiatives continues and we are running an extremely reliable airline as a result. Whatever we do, we will always take great care to ensure the path we choose returns value to our shareholders and customers, and also provides long-term stability for our employees.

Thanks for all you do for our customers and keep up the great work.

Continental rejects United as merger partner

photo by Drewski2112

Well, it was a bit of a surprise. After the linkup between Delta and Northwest a few weeks ago, many (myself included) expected to see continued industry consolidation. And a merger between United and Continental was seen as a likely one; rumors floating around pointed to an announcement as soon as this week. The merger would have created an airline that might rival Delta/Northwest in size, as well as international coverage (United's strong Asia presence would fit nicely with Continental's extensive European route network).

But last week, a little something occurred that made Continental think twice: United posted a $542 million loss for the first quarter of 2008. Even in the airline industry, a half billion dollar loss is pretty big, and it's a sign of an ailing airline. United's huge loss scared away Continental, which announced on Sunday night that it was abandoning merger talks with United.

The airline made the announcement in a letter to employees from CEO Larry Kellner and President Jeff Smisek. "We want you to know that our Board of Directors met today and has unanimously supported management’s recommendation that, in the current industry environment, the best course for Continental is to not merge with another airline at this time," it read... The Board very carefully considered all the risks and benefits of a merger with another airline, and determined that the risks of a merger at this time outweigh the potential rewards, as compared to Continental’s prospects on a standalone basis." The letter - which never identified United Airlines by name - went on to say that the airline will "continue to review potential alliances and our membership in SkyTeam. We are considering alternatives to SkyTeam as we carefully evaluate which major global alliance will be best for Continental over the long term."

Continental's decision is certainly a setback for United, which has been looking to merger for some time now. I don't think that the decision to not merge was arrived at easily, since there could have been some benefits from linking with United. But the folks over at Continental are betting that a merger with United, which is racking up heavy losses, could also drag them down as well. Even though Continental definitely wants a better Asian route network - and they could have obtained it through a merger with United - it might be able to get it another way. If United files for bankruptcy again, Continental might be able to grab the Asian routes by themselves, without having to deal with United's poor financial shape.

Continental has also reportedly been in talks about forming a three-way alliance with American Airlines and British Airways, although, from an anti-trust standpoint, this might be a bit difficult.
And as for United - well, this is certainly bad news. CEO Glenn Tilton tried to remain upbeat in a statement released Sunday night: "Our strategy is consistent. Consolidation is underway - ensuring you have the right partner is everything. We will pursue all options to ensure a strong, sustainable future for our airline and will not shy away from the tough choices necessary to create value for our shareholders and benefit our employees and customers." A United-US Airways merger might happen, but I don't know if it will do much good. Both airlines are still dealing with their respective trips to bankruptcy court, and I don't think that a merger between them will solve anything.

Continental to join Star, link with United

photo by sea turtle

Even after merger talks between United and Continental fell through a few months ago, the two airlines are still interested in cooperating - yesterday, they announced plans to start codesharing and for Continental to join Star Alliance, of which United is a member. According to an email sent out to Mileage Plus members, United expects the deal to start sometime in 2009.

It remains to be seen what this means for US Airways, which has been a Star member for a few years now. It's possible that it could remain in Star, but having three US airlines in the same alliance could lead to some overlap.

American's new deal with BA, Iberia

American Airlines, Iberia, and British Airways announced earlier today that they were forming a three-way alliance that would allow them to cooperate on flights between Europe and North America. Although the three airlines are already part of the oneworld alliance, the deal allows them to work more closely together and to cut costs. Not surprising, Virgin Atlantic's Richard Branson took a dim view of the deal, which he said would create a "monster monopoly".

The announcement comes at a time when other airlines are also seeking to link up: United, Continental, Air Canada and Lufthansa are working on a transatlantic alliance, similar to the AA/Iberia/BA one announced today.

United pilots: remove CEO

The Air Line Pilots Association (ALPA) and the United Airlines MEC (Master Executive Council) have created a website, GlennTilton.com, which calls for the removal of Glenn Tilton as United's CEO. The website said, "As professional pilots, we believe in accountability. Glenn Tilton, Chairman, CEO, and President of United Airlines, has failed all of us… costing shareholders, employees, and the travelling public billions of dollars."

Is Glenn Tilton to blame for United's troubles? The website says he is. "To Glenn and his staff, responsibility for United’s predicament belongs to everyone and everything other than themselves... Their excuses include high fuel prices, increasing costs of security, more competition, and stronger regulation, and they see themselves as victims of these uncontrollable factors. It just isn’t right, and it just isn’t true. These same factors influence every airline, and all the others are handling challenging conditions much better than United."

Or are the pilots just upset with management? Leave your opinion; please comment!

Continental gets approval to join Star Alliance

photo by bribriTO

Continental Airlines yesterday received a tentative OK to join Star Alliance, although the US Department of Transportation will require Continental, United, Air Canada and Lufthansa to release an 'annual report' on the alliance. Star Alliance is already by far the largest airline alliance, and the addition of Continental just makes it even bigger. As such, the US government has expressed concern about the impact on competition - and so has Delta, Continental's current partner in the SkyTeam alliance, which has complained that the impact on US domestic routes would be too large, given that United and US Airways are already members.