United CEO Lays Out Initiatives to Instill Brand Loyalty

Back in January, United Airlines President and CEO Oscar Munoz underwent successful heart transplant surgery and was confident in his goal of making United the greatest airline in the world, making brand loyalty a daily reality.

“My new heart makes me feel like I’ve been given a new set of wings, and that reinforces my confidence that, with the wings we all share, we can soar in our quest to make United a great airline for our customers and a cherished place to work,” Munoz wrote in a letter to employees in January. “I will be relying on this sense of team purpose as I transition back. We have some important decisions ahead of us, and we can move forward with the necessary boldness only if we have a shared trust, confidence and respect. Your hard work in the face of challenging conditions was exceptional, and our customers noticed. I couldn’t be more proud of what you did and am pleased to share that we received our highest customer satisfaction performance for the holiday period in more than three years! It’s a fantastic achievement.”

Building on that auspicious start to 2016, Munoz now has outlined value-driving initiatives for United.

“We continue to accelerate our business performance while making strides in earning back the trust of our employees and customers,” said Munoz. “With the renewed engagement of our 86,000 aviation professionals, a great global network, a highly flexible fleet plan and a healthy balance sheet – all of the building blocks are in place for United to unlock its full potential.”

Value-Driving Initiatives

Initiatives currently underway are expected to drive more than $3 billion in incremental value to United by 2018 through a combination of cost savings and increased revenue. These initiatives include:

Commercial Enhancements: Improvements across the commercial organization will drive approximately $1.5 billion of value through increased customer segmentation, updates to its MileagePlus program and modifications to its revenue management system.

Cost Structure Improvements: Upgauging aircraft and installing slimline seats, combined with continued sensible cost management, will drive approximately $1.3 billion of benefit.

Strong Operational Performance: The company expects approximately $300 million of value from running a more reliable airline. This operational improvement will grow United’s share of premium customers, reduce costs associated with delays and cancellations, decrease the number of passengers re-accommodated on other airlines, and improve schedule utility.

Sustained Improvements
Since the beginning of the year, United has achieved significant improvements in its on-time arrival performance, finishing first or second among industry peers all year. United has achieved top-tier performance in baggage handling for 19 of the past 24 months.  

As United continues its focus on elevating the customer experience, it recently announced the all-new United Polaris business class, free snacks, and transformed airport clubs.

For employees, the company has delivered new contracts for the pilots, IAM-represented employees and dispatchers this year and new and improved tools. These and other enhancements are delivering improved service to United's customers, with the company achieving record-high customer satisfaction scores in three of the last four months.

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