Apple is by far United’s biggest corporate account. They spend $150 million with the airline. Focusing on California-specific accounts the biggest are Facebook, Roche, and Google which spend ‘over $34 million’ and then Deloitte, McKinsey, PwC, Cisco, Oracle and Applied Materials in the $12 million to $17 million range.
This is all data leaked in the past few days:
Curious who are @United largest global corporate accounts? @Apple is in the top spot and contributes very much to success of SFO international flying especially the Shanghai service #UnitedAirlines #United #Apple #SFO #PVG #Shanghai #China pic.twitter.com/HNvIrz8wDg
— LAflyer (@LAflyr) January 11, 2019
Enlarging the graphic shows that it reads “This is confidential information. Please don’t share outside of United” at the very bottom. So someone printed it out — including with that warning — and put it on a banner. That probably wasn’t smart.
What we learn from this is that if a company is based in – or has a huge presence in – Silicon Valley, or California more generally, and operates globally then they’re going to do a lot of business with United. United has hubs at LAX and San Francisco, and significant international operations at both.
Of course just because a company is a big United customer doesn’t mean they’re only a big United customer. Facebook is one of United’s top corporate buyers, but they’re one of American’s top buyers as well.
If you’re flying out of San Francisco though you’re going to want to wave hello to Apple employees flying to Shanghai, Hong Kong, Taipei, London and Seoul. They’re also populating Singapore, Munich, Tokyo Haneda, Beijing and Tel Aviv flights.
I don’t blame them for favoring Haneda over Narita given the ease of getting into the city. It’s nice to know someone is buying United’s Singapore non-stops though Apple is doing their employees a real disservice by putting them on United instead of Singapore Airlines for the route, especially since United operates their longest haul flights with their old business class product — the same old seats running San Franciso – Newark fly San Francisco – Singapore.
Apple’s spending on San Francisco – Shanghai though is shocking, even accounting for all of the manufacturing done in China — one quarter of total company spend, 50 business class seats a day. That’s presumably 25 business seats in each direction.
I do think it’s a mistake to take $35 million a year and divide it out by 50 seats a day to figure out what Apple is spending. We should take these figures seriously but not literally. Still since United is running 84 business class seats a day in each direction between San Francisco and Shanghai that’s an impressive contribution from Apple. Now you know how two daily flights makes sense for United when American was losing tens of millions on their sole Chicago – Shanghai frequency.
Air China flies LAX – Shenzhen non-stop two days a week. I’m surprised that’s all, and that United doesn’t try the route though it’s just 24 miles from Hong Kong.
Regardless Apple isn’t going to be happy to see this data on their travel program released, or to see United using their brand on these banners. That and you’d think Apple would be embarrassed that Facetime isn’t good enough to avoid some of these trips.
Hardly a shock this leaked.
It took a smart person to print this up on a banner and place it where thousands of people including non-UA employees will pass by.
Anyhow, per BTN, Apple spent $275mil on air travel in 2017. Again not shock the biggest hub carrier in their home city gets the bulk of that spend.
Apple has far deeper engagement on manufacturing (everything from semiconductor process to hardware final assembly test) than those who outsource. The engagement with PE, RE, TE, VE etc across all its platforms plus audit for a company so large makes this a not so surprising number. On the old 747 was not surprising to have the entire first class full of Apple employees who have upgraded.
If these tickets are discounted, apple employees that are Chinese may spend their own money on personal trips to China. So the $150 million may be not all Apple’s corporate money.
If these tickets are discounted or come with perks… (edited)
I’m not sure SQ is not a clear winner over UA on SFO-SIN. Soft product is better, but SQ’s seat on the 350 is not comfortable at all for sleeping; UA’s is.
is there still a place on UA for self employed entrepreneurs like me? I’m a mere 1K, not GS
Good luck with that DFW Steve. If there is, let me know. I too am 1K and work for a not-for-profit flying the least expensive fare. I flew most weeks last year and barely made 1K with the spending 12K quotient. United considers us all equal, whether a multi-million or billion dollar corporation is forking out the dollars for those business class tickets or you and I are personally paying out of our pockets for upgrades.
I cannot imagine the purpose of displaying this information. Not one of these companies is going to look at this and figure out a way to leverage it into a cost negotiation. Does anyone think that Apple is going to try to cut their airlines costs by $10MM or $20MM by using a different airline?
Anyway, the information is copyrighted with or without the copyright marking and this looks to be more than Fair Use. So if the person who posted this is found, they could be in trouble.
I wouldn’t be surprised if UAL makes an example of LAFlyer. He could lose his twitter account.
Or, he may mysteriously start writing glowing reviews of UAL, and get to keep his twitter account.
What would Steve do? He’d cancel the contract. Will be interesting to see what Cook will do.
Nobody is gonna cancel their contract. They all know this could happen to any of them. If anything they will use it to leverage a better deal from Ua. Glad to see my employer made the list