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Monday, May 3, 2010

A Blow to Houston?

After months of speculation, Continental and United Airlines today acknowledged their pending merger, to be called United Airlines, and to be based in Chicago. Many, many people in Houston are unhappy about this, as Continental has long been one of Houston's largest employers.

Several years ago, Contintental, like many other airlines, was struggling financially. Then CEO Gordon Bethune had a vision: use the Houston hub to become a primary gateway to Latin America, upgrade the fleet to become the youngest in the industry with all Boeing aircraft, and create a service-oriented corporate culture driven by engaged, committed workers.

He scored on all fronts. Continental has more flights to Latin America than any other American carrier. Their Boeing plans are new, clean, fuel-efficient and reliable. And the people are well-trained and know how to do everything in their power to get plane off the ground on time. I fly them at least twice a month, so I have had many opportunities for poor service and have had no bad experiences!

The good news for the merged airline is that Jeff Smisek, now CEO of Continental, will take the helm. I've heard many, many people complain about terrible service on United flights. Miss Ginger personally has never flown them, so she can't judge. From what she's heard of Smisek, though, even though the planes and uniforms will say United, he knows he has a winning formula with Continental, and I expect although the changes for Continental's customers will be more visible as planes are painted and logos are replaced, the biggest change will be for United's customers, where they will see increased levels of services, better connection with the customer, fewer mishandled bags, and more on-time flights. For potential employees of the new airline: "It's Jeff's way, or the highway!"

Miss Ginger is not happy about the merge, but she is optimistic. Several years ago, when Houston's beloved Foley's merged with Macy's, there was similar uncertainty, nervousness, and fear. And yes, many people lost jobs. And many who stayed found themselves doing different jobs in a different way. Miss G was as nervous as any at first, but having worked for this new company for several years now, she can honestly say she has never worked for a better company! In the long run, it was a good thing for Miss G, and is a good thing for Houston. In some sick way, maybe keeping United's headquarters in Chi-town is payback for the loss of their beloved Marshall Fields!

Much of this is inevitable in a contracting economy. The United States had way too many department stores selling the same stuff in the same malls, and we have way too many airlines flying the same routes on similar aircraft. Other countries don't have 6 or 7 air carriers, they have one. It's more efficient economically in terms of space, people, resources. In the past, we had different airlines serving different parts of the country. But, as they have merged and purged and bankrupted and sold routes, we have ended up with a tangled web of crisscrossing markets, code-shared tickets, and marketing "alliances" that are confusing to customers and difficult to manage. Perhaps consolidations will sort some of that out. Clearly, it is working for Delta/Northwest, and hopefully will work for United/Continental. I also suspect this won't be the last airline merger we see.

Just think, in a few years we could all be flying "Consolidated Airlines"!!

UPDATE: I'm telling, this new airline is going to look much more like Continental than it will United. Check out the new livery and logo:

1 comment:

Bucko (a.k.a., Ken) said...

I think the driving force on the merger is South America and Asia routes. Now that United is doing better, Continental agreed to be purchased. Hope it works out.


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