United Airlines’ Investors Sending Strong Message

United Airlines last week reported a net loss of $609 million or $1.66 per share for the first quarter of 2014, which sent the carrier’s stock price to a three month low. In a conference call to discuss the carrier’s results, President and CEO Jeffrey Smisek blamed winter weather, increased competition in Asian markets and a softening Japanese economy for United’s poor performance. Mr. Smisek did not talk about how consistent management failures have plunged United into last place in customer satisfaction for the second consecutive year.

“Maybe United should treat its employees as assets to be valued and developed instead of costs that need to be cut,” said IAM District 141 President Rich Delaney. “United’s product has suffered due to consistent management failures, such as poor training and increasing reliance on third party vendors to perform operational functions.”

To put United’s loss in perspective, Delta and American both reported robust first quarter financial results of $281 and $481 million respectively, historically known as the airline industry’s weakest.

“To blame weather and competition is misguided,” continued Delaney. “Sure, those were factors, but every airline deals with bad weather and competition. But what about United’s antiquated reservations system—SHARES—and the slow and insufficient training offered to pre-merger United employees who never worked with that system? What about relying on low-paid sub-contractors who don’t deliver the same level of service as United employees? Those were bad business decisions by United management.”

United also stated the carrier is seeing an uptick in customer satisfaction, but the American Customer Satisfaction Index—the barometer of industry performance—says otherwise. In its annual report, United placed dead last in domestic customer satisfaction for the second consecutive year.

“United employees deserve better,” said Delaney. “They deserve a competent management team to lead United into the future.”

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