Oscar Munoz stepped down as CEO today, turning over the reins to Scott Kirby. He becomes Chairman for just a year.
Munoz replaced Jeff Smisek, who was ousted in September 2015 amidst a federal corruption probe. Smisek was accused of paying off the Chairman of the Port Authority of New York New Jersey with a dedicated scheduled ‘Chairmans Flight’ to his vacation home and back in exchange for putting items United wanted at Newark on the Port Authority schedule.
This only came to light, of course, because of the federal corruption investigation into ‘Bridgegate,’ creation of traffic jams in Fort Lee, New Jersey as political payback for failing to support the 2013 re-election of Governor Chris Christie. The probe reached into the Port Authority, and while Smisek was never charged Port Authority Chair David Samson was ultimately convicted for extorting the flight from United.
Munoz took over in a rush. He lacked experience in the airline industry other than as a board member of the airline. However he began to get employees on his side before quickly having to take time out for health reasons. He was initially great for the airline’s culture and he green lit product investments – from Polaris, to coach snacks like stroopwafels, and improved on board coffee (the previous brand Fresh Brew was derided by customers as ‘Fresh Poo’).
Oscar Munoz Cutting The Ribbon On The First Plane Equiped With New Business Class Seats
Given his health challenges he was likely a short-timer. He was supposed to become CEO and Chairman but his ascent to the Chairmanship of the airline was delayed by the David Dao incident. He blew the airline’s response by apologizing that customers had to be re-accommodated — as opposed to being shocked, angry, or disappointed that a customer was dragged off and bloodied.
Ultimately though the most consequential decision he made was hiring Scott Kirby as his successor. Kirby’s history is as a destroyer of airline customer experience and as a micromanager, eliminating elite bonus miles and charging for water at us airways, insisting that American AAdvantage blindly follow the revenue-based programs of Delta and United rather than charting its own path and even getting so far in the weeds as to overrule the AAdvantage team over the name of their new 75,000 mile elite tier.
Since Kirby’s arrival at United we’ve seen a steady degradation of the Polaris business class product, from reducing service levels (dropping a flight attendant and pre-plating meals) to efforts to control alcohol consumption. Employee bonuses were cut. The airline failed to invest in competitive wifi in order to offer anything like Delta or American.
United has been the worst actor among U.S. airlines during the global pandemic, breaking the law by refusing refunds to customers for cancelled flights, making it harder to earn elite status (via partners), and devaluing mileage plus via higher award pricing on partner airlines. While other programs consider the need to be more generous, Kirby’s focus has been how to avoid giving anything to customers – even things they’re entitled to.
Munoz has good feelings surrounding him, he’s seen as a good guy, but his legacy is Scott Kirby. It may be that Kirby’s talking up job cuts has been strategic, positioning for a second bailout (that airline lobbyists are already pushing for), but also to scare unions into contract concessions.
Ultimately Kirby’s move to announce aggressive layoffs coming October 1, and to force non-union employees to take unpaid vacation days, along with moves against United’s customers may preserve enough cash for the airline to avoid bankruptcy restructuring and preserve himself as head of the airline.
By the way Kirby is also the most interesting airline CEO to listen to because he isn’t mealy mouthed, he says what he thinks more than you’d expect from other similarly-situated executives. And he now is on Instagram and has one post.
Munoz showed promise for United early on but missteps and his choice of airline President did in his legacy.
…and, yet, financially, UA became a highly competitive airline in spite of the Dao fiasco, Munoz’s lack of prior airline industry experience and Kirby’s reputation as ‘destroyer of airline customer experience’…
I know tons of United employees and they have nothing but positive and highly complimentary things to say about Munoz. They believe he saved the airline
Well done article. Sadly, United is winning the race to the bottom.
@Christian — Did you perhaps mean ‘AA s winning the race to the bottom’?
Oscar’s hiring of Scott Kirby was his biggest downfall. United has already been ruined.
Another day another hit job clickbait “article” by a blogger.
Everyone remember this guy writing the article has achieved the lofty ability of buying an airline ticket and proclaiming himself and authority.
Oscar united the United employees. He achieved contracts with all of the labor groups.
Just because the blogger doesn’t like him or United does it make this article real. I was never an fan of the term “fake news” but this writer is nothing more than a hack that is probably scouring airliners.net to post his self diagnosed insider knowledge.
Wow actually I’m very impressed with Munoz’s leadership at UA. I believe the author must have an issue with UA, probably some form of bias or something….
Yet, if Kirby stayed at AA, is there any doubt that United would be firmly occupying the spot (now held by AA) as industry laggard and “most-likely-to-file-Chapter 11-within-a-year”?
Your consistent and strong criticism of Kirby has a basis in his track record, but it seems inconsistent to spare Doug Parker the same rigor, considering the two are essentially cut from the same cloth… though I think Kirby has stronger analytic talent.
When you only hear the self-indulgant platitudes that the union bosses allow their dues paying members to hear, you can only see Munoz’s halo. In all honesty, I believe Munoz may be a slightly better than Stephen Wolfe, but even Tilton was a better leader, for all his faults. United has reversed course multiple times in their journey through Covid calamity, and they apparently have no feeling for “Their Family”, as Kirby puts it. And yes Kirby could be the nail in the United Coffin.
@Paul sez: “Oscar’s hiring of Scott Kirby was his biggest downfall. United has already been ruined.”
It depends on what the meaning of “ruined” is. Before the pandemic hit, with Munoz and Kirby at the helm, the airline had gotten through completing a turnaround that was almost miraculous, after the calamitous tenure of Jeff $mi$sek as the post-merger CEO, to become highly competitive financially.
I believe that by “ruined” you are referring to the *perception* that travel bloggers, like this site’s host, can convey about a program, a company, a person, based on the bloggers’ own narrowly-defined and usually self-serving standards of success or excellence.
Of late, UA had done some things that got me, one of their 1MMs, to dump their loyalty program after many years, but that was not because the company was “ruined”. Rather, it was because they increased the cost of making top elite to the level that I could no longer justify remaining on the status hamster wheel, so I hopped off. Other people were not bothered by the change and remain with UA.
However, claiming that UA “has already been ruined” because they made decisions that rubbed some customers or ‘self-anointed’ travel gurus the wrong way is utterly myopic because (a) it ignores that, financially, Delta is leading the other major US airlines, despite having consistently made, over the years, decisions that were generally perceived as customer- or SkyMiles-unfriendly; and (b) United did not appear “ruined” just before the pandemic hit; the company was thriving…
I have never subscribed to the widespread negativity toward Kirby. I simply saw it as a fabrication of travel bloggers disappointed that Kirby would not live down to their standards of success or excellence by trading his airline’s financial viability for a set of ‘desirable’ elite perks on travel bloggers ‘wish lists.’
If one drinks too much of their kool-aid, one would begin spewing nonsense like “Oscar’s hiring of Scott Kirby was his biggest downfall. United has already been ruined”
Munoz is no different than Smisek or Kirby. He does not get a pass. All three are horrible. Nor does the United Board.
Long time United platinum member. I was seriously unimpressed with Kirby’s e-mail I received a few days ago. “We’re cleaning our planes with Chlorox”. Big whoop. How about actually not selling middle seats like you claimed you would do?
I think Scott Kirby is exactly the CEO United needs during these next two years. Airlines which succeed will be the ones which treat nickels as manhole covers. His hopes to keep more staff onboard but working fewer hours does position United partitioned for recovery, if the unions will accept this, at least temporarily. It’s also not a wage reduction, unlike British Airways is attempting. Kirby also has to keep the investors happy, or at least not revolting. He also needs to have an airline people are willing to fly on. Not offering refunds might encourage people to fly, and on United to use their credits. The real question is whether bankruptcy is a better option than keeping the airline barely able to pay its debts. If American were to file for bankruptcy, it might discharge enough debt to be a stronger competitor.
But Kirby might not be the right guy to attract customers if the industry gets back to the level of held recently.
Monopoly/oligopoly corporations ensure you don’t have a choice so you have to give them your money no matter how bad things get for you.
Gary, Are you on drugs? What a drive by hit job article. It’s obvious that you have no clue of what Oscar has done at United. I know there are United haters, you know what they say “haters gotta hate”. As a 30 year United Airlines employee I have the utmost respect for Oscar and Scott. They have done a fantastic job turning United around.
If you decide to fly on United we will do our best to get you to your destination Safely,Comfortably and on time. If not may I suggest making other arrangements.
Have a nice flight,and please stop using drugs.
Gary Leff is a Laff a true joke Do nothing but Laff at Him. Gary Laff You probably haven’t been a success at anything so You try to bring everyone and everything down around You. What a depressing person You must be. I will not be reading anymore of Your articles.
@John H sez: “But Kirby might not be the right guy to attract customers if the industry gets back to the level of held recently.”
I was with @John H until the blurb I just quoted above.
That’s an incredible statement considering that Kirby *was* the guy when the industry got “to the level of held recently.” Why would he then become the wrong guy “to attract customers if the industry gets back” to that *same* level of held recently?
Inquiring minds wanna know, right there is the type cognitive dissonance that results when uncritical minds are constantly bombarded with dogma that has no basis in reality, the dogma here being that Kirby is the “destroyer of airlines.”
Ask yourself this: How can Kirby remain at the top within the airline industry for as long as he has if he is as awful as the chorus of self-anointed ‘travel gurus’ claims he is? ‘Natural selection’ or the survival of the fittest works at the level where Kirby has been for years. Just ask $mi$sek, who is now out because his mismanagement led to the collapse of CO and its absorption by UA. Then as CEO of merged UA-CO, $mi$ek’s incompetence got fully exposed as the merged airline floundered, before he got caught in a shady favoritism deal and resigned. Legend has it that he’s now out of the airline industry altogether, investing his ‘golden parachute’ in biotech startups.
It seems that just like right-wingers distrust scientific expertise because it gets in the way, leading to denial of, say, global warning, so do self-anointed ‘travel gurus’ distrust any CEO that does not doled out loyalty perks, which is too narrow and inconsequential a window through which to judge someone who is at the helm of multi-billion $ company.
Correction”
“Inquiring minds wanna know, BUT right there is the type OF cognitive dissonance…”
Would great to implement even a simple text editor…!
I expect more brilliant moves from Kirby and his team, like those of Hi-J 767, and CRJ-550, boosting United mid-continent hubs. these are home-runs! Do you even know what Hi-J 767 is doing to UA’s London routes? the author is clearly biased and full of himself.
@allan Jackson
I don’t think United ever said they would not sell a middle seat. You read what you wanted to read, not what the facts of their release said.
Middle seat empty going to prevent you from getting covid?
What about the person sitting 3’ behind? What happens if they sneeze?
If you are that concerned about having space next you there are options. Buy a net jets membership. Buy another seat. Travel in F class (believe it or not those seats can be purchased). Or finally if you fear covid to a greater extreme perhaps travel isn’t something you might want to consider.
KIrby is a D..K
This author does seem to have a particular chubby for Kirby and United. I agree with others in saying that if Kirby were truly as bad as this author advertises, he’d no longer be around. Funny how no mention was made of the major changes Kirby (and Nocella, once Kirby brought him over from AA) made to United’s network/hub strategy that significantly drove up unit revenue, even when Wall Street told him he was crazy. He might not have the best people skills in the world, but the guy knows what he is doing. If he can continue working to soften his interpersonal skills, I think he’ll prove to be exactly the CEO United needs.
As a retired employee, and long time stock holder, I see greed among the top 20 individuals holding leadership positions. Greed is the driving force for them all. True leaders would be willing to put words into action.
I would impose a 30% reduction in compensation to all staff making $75k or more in management and administrative staff. The top 20, who all make multimillion dollar salaries, they would voluntarily go to zero compensation, after 12 months, their compensation would be equal to the percentage of 2018 RPM’s that UAL is carrying at that time.
The compensation the top 20 are currently Receiving, is mostly based upon UAL’s success, and RPM’s is the best measure available for comparison.
Gary Laff is a carnival barker. Unfortunately these ridiculous stories he authors get linked into real news and published as a fact.
I wonder if Gary makes his ends meet by being paid to make negative comments about certain carriers by another airline. Maybe friendly little Southwest, that Gary never seems to find a fault with is his sugar daddy? Think it couldn’t happen? It has in the past. I wouldn’t be surprised if it’s not happening with Gary. You have to be a special kind of dense to paint a picture of doom and gloom from the Munoz era at UAL. Take a snap shot of any other period compared to his tenure. Look at the financials and strength of the company and Munoz exceeds in all metrics.
Could this be Gary’s gig now?
https://www.google.com/amp/s/amp.theguardian.com/media/2006/oct/17/marketingandpr.newmedia
Wow I have always felt that this writer had a special hatred for United but now as 90% that have so far commented the same thoughts then its obvious that my “feelings” were not only mine.1st day on the job and Mr. Kirby is considered the CEO who will ruin United. Previous CEO’s at United have brought some good I suppose and some bad but at least give him a chance of at least a year for heaven sake.
@GK for avoidance of doubt I have never received a payment from Southwest Airlines, other than a $100 customer service voucher.
Hiring Kirby was a huge mistake but typical of UA to see Kirby was available and rush to hire him rather than wondering why he was on the outs at AA and asking what does AA know about him that they should know.
Come 2017, Kirby led a top-to-bottom reorganization of UA management that in many areas turned out to be just an excuse for weak leaders to get rid of people they didn’t like.
@D. Rock sez: “Hiring Kirby was a huge mistake but typical of UA…”
It was not a “mistake” just because you keep parroting that nonsense without considering the facts. Where was UA *financially*, which is really the bottom line and the yardstick, before Kirby was hired and after he was hired? Do you or others pushing the meme that “”hiring Kirby was a huge mistake” even have a clue?
No need to answer that. It was rhetorical…
Wow… so many opinions. Which is the right one? The elite customer, the employee, the blogger? Kirby was hated by AA employees, will soon be hated by UA employees. When you get up close to Oscar, he’s as phony as a $3 bill and I have first hand knowledge. United leads from behind, last to follow suit and always trying to do it cheaper.
To all of you, Munoz knew he was over his head from the start. His experience in the BOD was unceremoniously noted. He hired Kirby, because he could be as ruthless as Blafoon, Smisek, or any others who came from CO. I hate to say it, I hope Kirby tries to be a man of the people, but I think he will destroy another Icon of the aviation industry.
@gary
The bag man never carries a business card when delivering the cash…
Unfortunately you are what is wrong with much of the world these days. While social media and the internet had great prospects it gave a voice to those with an agenda, bullies, nutters and the ill informed.
People will read your story as a fact when in it is actually an opinion not supported by data. Just a grudge because United revamped their FF program or perhaps a united employee stole your wife away from you? You now use your pulpit to break “news” when it’s an opinion. Your recent clickbait story on their early out program is a good example. You wrote the title as if it pertained to all employees, got many of the facts wrong. Yet you didn’t correct your story. Instead you left it full of inaccurate information and unless someone took the time to do research or read the comments they would accept it as being factual. That is how a false narrative is spun by in Internet blogger.
In defense of Gary Leff and his opinions about United, I think he makes several valid points. It’s not unreasonable for customers to expect service providers to act with integrity, keep commitments, and “walk the talk.” Given that taxpayers are providing unprecedented financial support to the airline industry, customers have every right to demand honest, forthright treatment. This includes timely communication, message consistency, refund policy clarity in accordance with government policies, and “leadership” rather than “followership” from industry leaders like United. Such leadership should include seeking to balance customer needs with corporate revenue and profit objectives. Quiet, negative Mileage Plus changes in the dead of the pandemic and implicit devaluation of award miles by removing award charts do not strike this balance. While some readers may object to Mr. Leff’s criticism of United and its Scott Kirby, it is wrong to call this a “hit job.” Through its actions and inaction, United has earned such criticism and its senior leadership is a perfect position to change this.
David William,
Since you reference the “hit job” the Leff has done in this piece the point of it being a hit job if you can go back and read more of the historical writings From him about United then it’s more clear.
If this was the first article of this nature on United then ok I see what your saying but it’s not.
The fact his Leff is as always doing a “hit job” on United. I am saying to already say MR. Kirby has struck out when he just stepped into the batters box is ridicules and that the manager who has placed him into the line is wrong. That being said the United Continental merger was putting Continental people in charge did not make the United employees happy. Go ask flight attendants or retired United people (I have). Life is not always about money the management took away serious benefits away from these people just go ask some. So MR. Kirby is the new guy on the block not from the Old United nor the Continental management. I say give him a fair chance.
Point 1. Gary is doing a great job, without regard to the topic of this post. Go to point 2.
Point 2. Kirby is really really really bad. In this regard, it does not matter to me what Gary thinks of him. Go to point 1.
Hopefully, my message above will send some of the complainers on an infinite loop. Geeez.
@Walter A. To your point “give him [Kirby] a fair chance,” I suggest that Kirby should be held accountable by customers just as each of us is held accountable for our actions. The obscure, changing refund policies, the award chart disappearance (also known as mileage devaluation), the pandemic-timed partner award changes, and the to-block or not-to-block middle seat fiasco were all on Kirby’s watch. And as for Munoz and his Board’s decision to pick Kirby, they all knew what they were getting from Kirby’s track record. No one should be surprised by Kirby but many United customers will be surely be unhappy.
What was the name for the 75k mile elite tier that the AAdvantage team chose, that they were overruled on?