[Music] so thank you very much for coming today how many people here have flown United Airlines okay how many people here have suggestions about how they might do something different okay this is where you put two hands up thank because that's everything people here are pilots for United Airlines okay anybody else on the night air on okay if I could David there's a whole table of employees from all our Washington area of Baltimore Dulles and DCA right there okay so I want to talk about Airlines and United but first I want to talk about an incredible story that many here may not be familiar with so let's talk about your background initially to get to this story you grew up in California and you had eight siblings I do and what does that like I'm an only child what was it like when you have eight siblings is that easy to do or if you're an only child it's probably hard to reference a good point of view but no it was hectic it was crazy we shared everything we had first and second lunch because we couldn't fit everybody at the first table when you're a large family everybody in the neighborhood tends to hover around your place anyway and so there was never a shortage of Massah when I first brought my wife home for Thanksgiving I said okay honey let's just get ready okay this will be not normal so that's great when you're growing up you were almost having a good student you got into Harvard then you chose not to go why was that it was an awkward moment I'm the first to go to college came blue-collar family and we were invited to an event there was a black-tie optional event I don't know what that means at that time and my dad certainly didn't and we had to walk across first of all we got stopped at the door because they said you must be lost because it the way we were dressed I had to remember I was in high school my hair was down to here I grew up in Huntington Beach so I was a surfer kid and my hair red and long and ratty and I thought I look good so walking across a room of this size with all eyes upon you and then sitting at a table with everybody asking you questions like who are you what's your major no some things that I knew so I knew that wasn't quite the right fit and Southern Cal was just closer to home maybe on a great university have you ever thought what you could have accomplished with your life had you gone to Harvard God knows I could be in that seat so you went to USC the university of southern california and obviously did well you work your way up and ultimately you find yourself at CSX a railroad company and you were working your weapon you were president and CEO oh is that correct less and where were you living to do that you were the headquarters is in a place called Jacksonville Florida North Laurel alright so you're doing that and you're probably about ready to be made CEO and at the same time you're on the board of a company called United Airlines so one day there's a need to have a new CEO and they ask you to be the CEO why did you want to leave Florida for Chicago and why did you want to give up running a railroad which is maybe not as complicated as running an airline why do you do want to do that one of the more complicated questions in my life right and to add to that by the way my first daughter was getting married right around that timeframe and we had the wedding plan my wife's entire sole interest over the course of that momentous decision was you better get your father of the bride speech done but now it was a difficult it's listen I and there's some friends from CSX that are here today and it was a wonderful place we spent 12 years they're doing a lot we took the market cap of that company from 6-7 to 4050 and so we had a great riding and frankly I just thought I had another turnaround in me a and B when you meet the people of United and what we needed at United was someone that could relate to the everyday folks that we work with that I thought I could do that better than the most so you took the job as the Prez the president and CEO of United and when you took that job you were somebody who was a good athlete I assume you were exercising a lot I was so one month after you take this job you get a heart attack now I'll never go to any conversation without this one but yes now 38 days to be exact all right so did you think maybe you had taken the wrong job it was too much pressure and you know you were a vegan and you were an exerciser and that you run marathons or so what went wrong so it's a quick public service announcement to all of us in the room heart disease is the biggest killer in America be serious most the reason why is most of us don't know we have it my family background didn't allow me to understand a lot of my history and so again being relatively fit and eating crazy like a vegan you think that nothing would happened and something did and I think when you talk to cardiologists who you talk to heart specialists unfortunately you know some of the things internal your plumbing is what affects you so yeah nobody believed that they could believe that I got hit while riding my bike or by something but heart disease wasn't in works okay so I haven't had a heart attack yet but my impression is that today when you have a heart attack they you know they have a lot of medicine they can fix it it's a lot better than it was 20 years ago or so so you have your heart attack and then they come in and say guess what you need a heart transplant yeah so were you a little surprised about that it was a little surprised and a little hesitant you know they they talked about the fact that heart transplant surgeries are 93 percent successful the actual surgery and of course us being who we are it's like so what happens to the seven percent someone they got a good answer on that one by the way so when they came in and told you you needed a heart transplant did you ask for a second opinion or anything like that no we did travel around and I'm fortunate enough to know people all over the country and I was trying to figure out if there was something else because most of us guys in particular thing we can fix things right as I got just you know run it off or something that is not true ladies and gentlemen you cannot fix these things and what the doctors around the world that I trust and know told me they said sit your butt down and get the surgery because that's the only way you're gonna live okay it's one thing if they say you need a heart transplant but you got to get a heart so didn't get the wait on line for a long time how did you how did you get a heart it is the most one of the most Byzantine processes of how you apply and what levels you're in and how all this gets worked it's very well regulated and and modulated so that people don't take advantage in any way shape or form but I was very fortunate I was on a list and on my birthday he's a gentleman oh my birthday morning of my dr. Anderson called and said quote have we got a kick-ass heart for you and we happen to be at a meeting in United it's kind of a strategy vision going forward that I where I was in the middle of it I had come back from my heart attack and I had this device and I stood up after lunch we were determining actually the strategic future of the of the company where all the things that we've been able to do in the last couple years that led to the video and all the things that we're doing but as we broke I knew that morning I had to go into the hospital that afternoon and so I went to the meeting just what else am I gonna do for the morning and we were excited and then I didn't say anything other than my general counsel and a couple of books to make sure they knew but I did stand up at lunch and said I'm not gonna be back after lunch I got to go to the hospital I got this thing I got to do but it's a classic line that I didn't mean to say the way I said it but I said I'll see you on the other side and again as you know there's a lot of meetings I meant the most positive meeting meaning hey I'll be back and so the surgery was went great I was in and out I was out of the gosh a 21 year old beat me as far as the history of Northwestern Hospital but I was out about seven days seven days so I don't know Thursday I was back at the office on Monday in smaller levels no we didn't tell the world and analysts and investors that because they freaked out but I was spending a lot time back in the office I've never heard somebody say in a meeting while I got to go have a heart transplant to say afternoon so that's a very common thing but I'm sorry I didn't say that's it I gotta go do something do you know do you know whose hard it is you know it's an interesting thing I do not and I've asked and I want to it's also difficult the psychiatrists and psychologists that follow you to make sure that you're sort of fit to have a heart actually don't recommend you to learning at least for me they feel that someone that's doing well physically and mentally otherwise when they find out whether donar heart came from in the circumstances the lead to somebody perishing that that can get in your head and affect your health do you feel a lot younger with a young heart like that or well my hashtag in my family threads with my brothers and sisters who I'm the oldest is hashtag youngest child so yeah I feel a lot better than most so after you have your heart transplant you can go back and work in how long after were you able to go back and really work again I was in the office fairly shortly but I took a month of just the immune suppression is one of your biggest issue when you have a transplant you don't want your organ to reject so they have to bring your immune system down and so anybody that has a cold if I'm near you I catch pneumonia if I eat something that's not good I get really sick but you know over time you develop a tolerance and did you fear that the Board of Directors of United say well look we like you a lot but you know a heart transplant come on it's a tough job and why don't you take a easier job did you even worry about that this is a crazy industry I am literally fired every other day on the press and at the time I was dying and I had everyone has predictions everyone has metrics and things of how long people live after this I counsel and I and I advise and I a lot of families that are going the same thing them that I went through in my family and you can't always listen to that you have to know yourself you have to understand that those metrics are broad and average and and and it's who you are and what you want to do and how you want to accomplish it it keeps you motivated and drive alright so today you're in pretty good shape you have a heart transplant but other than immune issues from time to time you're feeling as good as you could possibly feel I think most people wouldn't I ask the table yesyes I mean we're always I'm always running around I just came back from Australia and know it there's no restriction you still exercise a lot I'm not a lot because the job unfortunately takes you I'm not Dennis Muhlenberg from Boeing I ride bikes with them but so have they thought that maybe exercising and being a vegan isn't such a good thing and maybe don't exercise and eat all the meat would be better have you ever thought of that my doctor who is a larger gentleman I think would advise me he advised me to go from vegan to what he calls flexitarian meaning he what the hell you want all right but he lots of it's because you need to get away alright so let's talk about the airline industry that you're now thank you why is it that people love to fly around the world at relatively low prices people can fly in a much bigger discount to flying around the world than maybe twenty-five years ago before prices were deregulated so forth but people don't seem to like Airlines they like to fly they like cheap fares but why is it that generally the public doesn't seem to like Airlines well a couple things you're right prices since so next year will be the 40th anniversary of deregulation and so many new things have been offered so many products and to your point on pricing I think the number is 4045 percent inflation adjusted basis prices are actually lower schedules are increased we have much farther reach but the customer has evolved as well and again as I said we have 150 million of you wonderful people every year and you all have opinions on various aspects and you know not everyone dislikes things but people that fly berry infrequently so for instance a luggage and a fee around luggage they if you haven't flown in a few years and now you have to pay I could get angry and so things have evolved a good thing is the airline industry is generally profitable where you used to hear about us in bankruptcy every other day right and so we have to balance that history of providing everything you want all the time at a low price to still having a relatively low economic price but also adding all the product and value and schedule and efficiency that we've been able to do the industry doesn't seem to be as popular as let's say people like Apple they like Apple products they like Amazon they like Amazon service that worth but they use your services but they don't seem to like your airline or any Airlines yeah well some like more than others but there is a negative narrative out there and it's just something that we all wanted to have to work through so today you compete all airlines compete mostly on price or is it food or comfort or takeoff schedules what are the most important things Wow do we have that much time okay um so briefly it's all of the above right I'm scheduled probably is a little more right I want to go there at this time price closely followed but again we also have a different segmentation of customers you have the folks that fly in the front you have folks that are more budget conscious and want to have options in the back so for us offering something like what we call basic economy all the way up the screen to our first-class product or Polaris service is something that's important for us to be able to do now in the old days you pointed out the old days thirty years ago or so a lot of airlines were going out of business I've read about the old days I don't know so bran if there's no my words only 30 bran FTW a Trump shuttle they're not around anymore I don't know what happened not going there I don't find the Trump shadow I don't know but so why are there so many airlines internet elite some of the airlines that went out of business but today the airlines seem to be profitable is that because you the algorithms have work so you know how to actually have not too many empty seats well consolidation has helped I mentioned my railroad experience and I think if you look at their history I think the airline is closely followed the same evolution of less folks vying for the same amount of customers surly as part of it I think some discipline around how we invest how much product we offer how we price and how more importantly how we are efficient you know the Boeing and Airbus folks are usually around in these rooms incredible products that they're building I mean their souped-up Ferraris that we have available to us and very fuel-efficient as well so it's a combination of all of those things but underlying it all I can never forget the fact that all this product is supported by the human beings that run the airline every single day so in terms of loyalty programs Airlines started them years ago and now you can't get rid of them maybe you don't want to get rid of them but are they expensive and they're people who really fly one airline versus another because of the loyalty programs loyalty programs are the most valuable assets that that we have in the industry and to answer your first question there's no plans of ever phasing any of that out because for those in the media that are here that's like the last thing that it's a very available commodity people love it people do interesting things to reach status you'll see people fly they'll tell you it's like hey I'm only on this flight to China because I need enough miles to get my status level for the next year so people do ask you have a wife forever other than that that's how they do it our our different levels of services are differentiated and people do appreciate what they get out now if people like to fly at the lowest price that they can generally some people don't care about it as much but certainly people are sensitive to it what's the best way to get the lowest price to people go online and book at themselves that they go through a travel agent is it to do what's the best way to get the lowest price um probably in broad aspects the further out you book the better options that you have but people use an interesting array of books so travel agents are still big customers of ours and they're still part of it our direct channels for us United comm is a growing channel I was just an argent I mean and or was I Australia a couple days ago and our business coming from travel agencies is like 74 percent which is probably double anything we do in other parts of the world some prices are sometimes varying so is it possible that somebody could be sitting next to somebody else on airline he or she paid a lower price the person sitting right next to him or her how does that work and is that people ever complain about that um nobody talks about that but yeah that's been an issue forever I mean you've got a corporate customer on a corporate that's gonna use someone that book far ahead so usually I mean I don't know about you in the room I don't usually ask who's sitting nice to me hey by the way how much did you pay for that ticket well but it is an issue but it's not a significant one well let's talk about your flying I assume you're not flying on private planes anymore no you got to eat what you cook so I'm very comfortable with our wonder price so when you want to need a reservation you have any problem getting uh you know getting a seat or anything enough we booked through the normal channels and when we call it's it's positive space or space available B meaning I'll look of light and if it's booked I'll find another flight like everyone else but you ever fly other airlines if you can't fly yours we do we do it Delta's in the room and they have a great product as well Southwest all our friends have some great stuff and it's great see what others are doing because part of the history of United is that we've had to ramp up our service and our product over the last few years and as we improve we feel very good about the improvement we're making but improvement is only relative to others that you fly as customers so we are very keen on the relative importance of making sure not only that we improve on our own basis but versus others so you're always seeing some great things other folks are doing right let's suppose you're flying somewhere and you know you're the CEO of your airline and you want to rest you want to read a book or you want to read something can you be on your airline and not have people come up and tell you what you should do better or bother you or is that how does that work yeah it's a not not an easy task anymore you're fairly recognized thank you when I fly sometimes you know and closer to the back there's you know a large percentage of people on any given aircraft well be their only time flying that year so the leisure traveler is a high percentage of people that are on the aircraft so the further back you go the less you're recognized in the front of the cabin it's almost impossible and people do want to chat and provide input and feedback on many things obtrusive yes I've had people you know really like I'll put my my headphones on and pretend to do something so I can try to sleep they'll reach over and take it out it gets worse so I'll be in the smart person that I am I went to the year buds figure and they can't reach and get those Oh contraire hey this guy reached in and grabbed this thing which is a little obtrusive but no listen it's all of us that are in this business I do this a lot and it's important to get from your customers and increasing in our business it's more positive and giving me good story when you're on the air let's say pose you're sitting in coach in the back and sometimes you fly coach did you ever say hey by the way you know who I am I'm the CEO you don't say that no in fact it's quite the funnest thing to do is to have a long meaningful conversation with someone and get lots of input about who they are why they're flying and they have no idea who you are and then they eventually figure it out because somebody tells them usually one of our flight attendants like hey do you know what that is so but you have a lot of people in first-class who when they don't like something they say do you know who I am you had a lot of that we have wonderful customers who have a very high degree over self-employed yes so by the way you know with United how many employees you have you have about 90,000 points 90,000 and how many of them are unionized the majority of them probably I think bless them we've got 92% of them okay and so you have how many airplanes do you operate we only 750 some and then we have another five 600 that we use with our regional partners so okay and today if you fly more in flights international or in United States the bulk of our flying numerically is domestic but we do quite a bit and you have hub system which is Dulles is one of your hubs what are your big other hubs in New York Newark then we go Houston Denver Chicago and LA in San Francisco so let's suppose you're flying and you fly into one of the hubs and you've got to catch an international flight and do you never hold the airline for you or they never they never hold anything no I usually I plan ahead as all of us should and we spent time in our quick commercial message our wonderful incredible Polaris lounges if you haven't been to one we got one in Newark we got one in San Francisco Chicago and soon to open in Houston so they really need what percentage of luggage is lost by the industry generally yours is nothing better but I my complaints per I think a thousand employments it's like three per thousand over the course of time and the best way to avoid the head of your luggage lost is do what just carry it on or your predicate I don't know an agreement with we don't we don't lose that much luck okay and if we do we get it right to you in fact we instituted a policy last year it used to be kind of owners where if indeed something got lost and we couldn't find it we made you put you know we needed receipts for everything that was in your bag including things you know I mean who keeps four seats for your underwear and your toothbrush so we instituted a thing it's like listen you trusted me with your bag we lost it here's fifteen hundred dollars with as soon as you ask 1200 ollars I guess is the number because it's important for us to build the trust we don't lose them that often we need you trust us and when we do we have to act on it very quickly and now in the old days the old old days people were worried about the safety of flying today do people care about the safety very much and you don't have a lot of accidents than the industry now no I'd say that's a safety is by far our top priority interesting safety and security has been an increasing focus so there'll be things that you as customers don't enjoy you don't like for a lot of different reasons it's unfortunately at this time in this day and age safety and security have to be our top most concerns sometimes that gets in the way of the customer service you'd like or wish but I think we'll all agree that safety and security are paramount and so know from a safety perspective the industry has an incredible incredible record and well people certainly do agree and concern themselves with it it is not something that we take lightly I noticed when you have flight attendants or pilots they're going through airports they have all their luggage in like a little black box then they have on a wheel I'm carrying all this stuff and you know how do they squeeze all that stuff in there's that a trick that you teach people or we can ask our captain or some of our plugs - no no I'd say well I think they know they have they have a requisite uniform that they have to wear so they don't have to wear about wearing nice suits like you and changing every other day all right so let's talk about some of your specific issues that have arisen recently you're probably familiar with them so no but I'm sure you're going to remind me okay there was a flight where I think there were some United employees that needed to go somewhere and you were trying to get people to get off the airline you offer him money which is a fairly standard thing to do and one person said I can't get off I'm a doctor I have to operate in the morning and not United but the local police dragged him off doctor down I think his name was so initially you said well they did the right thing and then later you changed your position and said you were sorry what's how did that come about and how have you change your policies to make sure that doesn't happen again yeah it's you know one of the dark moments and our our time and usually the question is are you glad that's getting behind you or something and I always say no I'm happy to be reminded of it every day and so as our as our company because it's important to know how quickly things can go sideways on us and so the circumstances that led up to that all the different policies and procedures in a nutshell again because safety and security and operational efficiency becomes we become so focused and it's important that we do that the rigor and discipline around safety security and operations doesn't necessarily apply to the comfort and the quality and the emotional connection as a human on customer service and so our rules and procedures you can't put always rules and procedures on how you treat another human being which is why we started over the last year something we call core for and it's and it's four principles that are in order and if you if you as an employee have any concern or any question about how to act you deal with safety first and number two and this is the big change for us it's caring just the simple word caring what does that mean you mean a lot to a lot of people but it doesn't mean shutting the door it doesn't mean yanking someone off the plane doesn't mean any of those things and then you get to dependable an efficient which are important but therefore they're simple but carryings number two okay so what is the policy now by the way do airlines routinely our Airlines over booked in other words if they're let's say they're 150 seats on the airline do you actually sell 153 and hope three people don't show up or how does that work you know you you've mentioned something with regards to sort of algorithms and information and big data analysis we have incredible records and data that show on any particular day on a particular flight X amount of people are going to not show up if you think of a shuttle from here and DC to any of the major cities that we serve out of here others people they get caught up in businesses they have a fascinating lunch with an incredible speaker like myself and they want to stay around longer at a pitch but people are always changing their flights and so we know that and we all over booked accordingly some places will be - some may be larger and we don't get that right on every single flight every single all right so 3,600 flights had more people show up then you have to see if you can get some people to get off the flight and the standard is to pay them X dollars to get off the flight is that there a standard amount you pay people well we are in fact one of the changes we made given the circumstances with dr. Dow and said is that we instituted along with a couple other Airlines the fact that up to $10,000 because that ain't your fault you booked a flight you're supposed to be there we screwed up we need to compensate you so you know you pay wait a second if somebody I'm thinking I got this right if somebody is on a plane and it's over booked so you have some extra people and I suppose these extra people are VIPs and they really need to go somewhere and you want to get them there if you go to the person and say anybody want to get off you pay them ten thousand dollars to get up to ten thousand but no but it's it's almost better than that in the sense that we know and have an understanding of what the situation's gonna be on that aircraft well ahead of time oh we also made a promise that once you're sitting down we're not gonna take you off the plane unless for safety or security issues obviously all right so so don't put him on the plane because that's when it gets bad so let's talk about another problem you had which was dogs you had a one dog that was supposed to go to Kansas and wound up in Japan and you know maybe he didn't have a passport so they weren't happy whatever and unfortunately a dog was put in an overhead bin and died and airlines typically you're not the only one if have dogs died and overhead bins or in container park compartments what is your policy now about how to avoid getting dogs going the wrong places and keeping them from dying yeah it'll be just a little bit of defensive nasaan my part we we as a as a as a company because we understand how important pets are the folks which you may not agree with given the circumstances but we flew three times as many animals for people all over the world because no other airline really was doing that so we were doing it as a customer aspect when you open up the arms that many animals well across a lot of things you introduced risk into it and so what we've done is we do you risk the situation we just brought that things back down as to what kind of dogs we carry animals that's very aligned with the rest of the airline world and unfortunately we're leaving a lot of people behind I'm making special exceptions well you think about who are these people that need this well you think of military families they're going out to Guam you know it's a young family with their pet or they adopt a pet while they're there and they want to bring the dog home and they need a way to do that so we're gonna make sure we cut out some of those things but there's just some dogs and we hired American Humane or partnering with American Humane that American not the other one but sort of advises how best to have these things travel because so it's difficult they notice a lot of people have things called emotional support animals or something like that where they get a certificate from a doctor saying I can't travel without this animal whatever the animal might be are people abusing that and you're getting a lot of big animals on your planes as a results yeah y'all anyone's heard about the peacock story so I think that won't go into that one we just had a recent experience where one of the emotional support animals before it required another emotional support animal so it was a dog in a monkey and somebody asked me earlier today which one was supporting her I don't know that he answered but I said no listen on a serious note of people that need things you know the problem is it's abuse because it's not regulated in any way shape or form and anybody can get it so we don't know so if you have a need I mean so service animals for disabled veterans for people that are blind we bend over twice over backwards to ensure we take care of the people that truly need aspect but when you get into the ridiculous stage where a peacock or two different animals and most of the consumers I mean if you have allergies so all of that has to be modulated and worked and there's no real rules around it and so we've taken that along with the other airline's pretty harder stance is like we need to have some proof you need to register the animal it has to be of a general size a nick Kalia from a forays here he was just telling a story this morning that there was a an animal the size of him sitting next to him just recently we have small ponies snakes I mean there's a and again it sounds funny but our flight attendants at our organization have to deal with this and so you know back to we're putting humans and we're getting them comfortable getting them on their seats and then all of a sudden you have to deal with that and that and many other issues that way so how do you deal with sexual harassment or the planes you have passengers sometimes inebriated sometimes not trying to do things they shouldn't do what do you do about that now yeah I just fundamentally as an individual human don't understand how people can do things that we hear people doing so that's just a personal opinion in addition people don't want to sit next to someone because of their race or their sex or their color and frankly I don't have a lot of time for that this is where customer service for me personally kind of goes out the window and says you know you want to fly elsewhere because we don't want to deal with that but the issues the real issues of sexual harassment safety in general is a very important one for us we partner with the people that Sarah Nelson is here from the American flight attendant organization we listen to them because they're the ones that generally have to take some of the brunt of this and it's that's it can be awful and and it's been quiet for a long time it's been going on for a long period of time and we just had a deaf ear to it and now the issue is that you have to human trafficking by the way is another angle that we have to ask our flight attendants to do how do you recognize it how do you resolve it and then inevitable you have false positives when you see something going on and then we pull someone off the aircraft you have a you know law-enforcement meet them and it turns out to be something different and then of course we get sued and that's always an has been an argument for why we shouldn't do some of those things I say may I say listen we'll take the heat for the things that the minority of things in order to fix the broader issue because it's a real issue so you have most of your flight attendants I presume or female but not all and most of your pilots are male but not all obviously is a female pilot right here but the highest percentage in America 7.8 percent of United so but how do you keep the pilots from socializing and appropriately with your flight attendants serves are not a problem David I'm not going there on that one now yeah there are wonderful people and and on a problem it not yes we're all human and everybody gets along very well okay and done all right so let's talk about I'm looking at Sara it's like what do I go with this so let's talk about this when you're the CEO of the airline and any given hour you have X number of flights in the air and how do you keep up with whether you're on time that day whether there's weather problems what level of things come to you if there's a cancellations of lots of flights how deep do you get into the detail of what's happening every day or that's something you just can't get in the middle of we have an alert system obviously for things there we have a whole bunch of algorithms about what rises to what level at any point in time the day to day issues Omar who's here who runs our Dulles hub is more involved in the day-to-day things but you know the the airline is always going through some issues we have a you know morning and an afternoon recap of what's going on and it's usually weather it's usually flight you know there's so many things out of our control that we have to monitor and manage and communicate to you as I think of you as customers our focus is reliability something you want because you know hey get me what you want what I need like be is is the first issue and we've been working on that we've had great records on that the other two are harder one its communication when something breaks or is about to break can you please let me know right if I'm here and my flights gonna be delayed can I know before I head to the airport so we're working on all this wonderful digital stuff to get better communication then there's flexibility which is the hardest thing for us because we fly so many people we're so structure we have so many aircraft in the air it's hard for us to your point earlier to hold the plane for anybody God for me and so the combination of flexibility reliability communication there are three big mantras and so we work on that very hard okay so today when the airline your your profitability is less than your peers your margins are lower and you don't make as much as the analysts want you to make so what are you trying to do to make your airline more profitable many things primarily one of the issues that we have is you know as most of us in here the know about business there's a revenue and a cost line and generally you want to make the revenue higher than the cost and the airlines historically have forgotten a little bit about that I think the new leadership in the industry gets that big time I think for us at United over the past since we merged the continental united sigh we went on a cost-cutting spree which is you need to be efficient but we forgot the revenue aspect and if you think about our business the way we generate revenue is we fly we fly to places they a you want to fly you want to pay to fly you want to you know fly frequently so we've been expanding our top-line growth capacity it's not always well received by investors because historically when you had too much capacity and not enough demand that's when the bankruptcies kind of came into play it's a new market were flying smartly we have some uniquely United sort of strategic reasons to grow and so we've been growing our top-line Wow being efficient and managing our costs and that's how our margin has been improving and the best way to have top-line growth is first-class international people pay full fare for that is that your most highest margin that tends to be the higher margin customers but now you know the real way for us to make money increasingly is what we call catchment areas people around big cities that have to come in $2 come back to go somewhere else and being able to get them and gather them catch them and put them into it so more people when you have connection flights people always worried they're gonna miss their connection so forth do you hold the airlines for anybody like there's a rumor in Washington that members of Congress can get airlines held for them is that there any truth to that let me explain the first part of the question we we mentioned this core four and caring that's one of the key principles because we generally as an operation don't want to hold anything because we have a schedule to keep but if one of my gate agencies you know a young woman with three kids you know running down the and and but our schedule says we closed it in 30 seconds and she's a minute away or ten minutes away whatever we have historically tended to shut the door to get it out on time again we say nay we are going to allow our gate agents to make that call and hold that aircraft for the right amount of time for the right person you know the morning flight you can let it go because you have other options if it's the last flight of the day you can you can hold it for someone so we don't hold aircraft for anyone not members of Congress nobody we don't hold aircraft for anything okay some would like to and again if it's the right reason and then we could and we can make the connections work and such again it's at the discretion of our folks on the ground and know the situation we will do that but as a general rule it's hard to do that and I know people often carry enormous amounts of luggage on board because they are afraid that might be they lose it there's are a limit to how much you can carry on board and putting these up these bins or you're trying to reduce that apparently not people do try to sneak a lot of things in so um there is limits there size limits and all that sort of thing and people are generally okay with it we've offered a new service called basic economy where in essence you go ahead and check your bag and it makes the boarding so much more efficient by the way is a quick another public service announcement and none of us will ever be in one of these accidents but one of the things people do if there is an accident or you have to you know they have an emergency you have to deep board the aircraft people will even with their lives at stake will stop to get their luggage thinking that they can go down a slide or anything it's like that's just a no-no I'm again never want to put you in that situation but if that ever is the case save yourself first we can buy you another suit another dress another pair of Jimmy shoes shoes okay so now you have a new way of boarding used to be you had like five different classes of people boarding so why have you changed the way people board and why is that going to make people happier I hate the fact that people wait in line for so long it's human dynamics you see somebody queue up you queue up right behind them it's like why because there's what they're worried they're worried about space available there's all sorts all sorts of different things that they work so we're trying different things and the industry has tried so many things across the the time span to try to facilitate that I don't want you standing up and waiting for 30 40 minutes for any reason so we will board differently and we're we've tested all of LA's that way we we we make whatever Pro takes them in here yet at home our and the next month but we're testing all to see how it works we're getting a lot of feedback from you as customers and generally the feedback has been pretty positive so when you get on the airline they have the announcements that you can't you know use your electronic devices and all that when take off is that really a problem I mean it's the airline going to go down if you use your iPhone or something all these things are based on the issue of safety of security of our passengers and there's percentages the spectrum could interfere and again we do that at prisons on landing and so you don't want to have any of that potential and again people are technologically well technologically will tell you that it's not or an issue I would rather we would rather sort of err on that on the side of caution and be safe now in your planes do you have Wi-Fi on most airplanes or a lot of them boy that's another loaded question again what yes we do have Wi-Fi it it's a huge bonus for us it's probably Neriah we need the most improvement there's so many different technologies that have been involved we merged two giant companies with different products and so as you try to sort of harmonize you know Arnie you're probably going through that with all your hotels that you're gonna work through there's just a lot of different investments that have been made over the course of the year so try to integrate and harmonize all these things take some difficulty some of the technology is evolving some of its better than others and so we have a mishmash but again remember you're not in your living room the streaming Netflix you're 35 40,000 feet in the air flying at 600 miles an hour we forget that sometimes and it does it's it is it is inconsistent which is the worst thing that we can do to you as a customer here's what we're working on that but it'll take some time but talking talking on the phone on those planes people don't want to do that your survey show that people don't want to talk let people next to them talk on air phone that's more that it's like I don't want to hear the conversation to my next day no because people do that and it's annoying I think for most people if you don't want to hear anybody else's conversation but you generally people are fairly courteous about that and don't do that often so the air traffic control system United States is a little dated compared to every other country practically so is that a big problem for for you and do you think we're gonna be making improvements anytime soon I sure hope so we had a big sort of debate as an industry versus the government with regards to in the last authorization bill and trying to work what we call modernization it's not privatization it's not anything it's an antiquated system that a lot of the world already operates and in the US has been slow to approach we do have a project that the government is working it's just been frankly slow and and we've had this debate back and forth they argue that it's going faster we argue that we're not seeing the benefits so we we've suggested some ideas that was rejected so now we're in the process of developing a new plan of how we can go forward because it is an issue through the times that we're flying are getting longer and longer because we back up aircraft again back to safety is of paramount importance right when you know the plane is in front of you we have to keep a certain distance because of the ground-to-air sort of technology that we use today and so sometimes we you know we fly relatively blind so we keep our space so it's not a safety issue because we space the aircraft but it is a modernization and efficiency I mentioned Boeing and Airbus and other building these Ferraris imagine taking a Ferrari and taking out on a gravel road and that's that my analog it just is it doesn't work that way so we have to be infinitely more modern and how we develop this and that's what working together the biggest complaints you do surveys of your employees and in surveys of your customers what are the biggest complaints you have by your employees if any and your customers our customers point we range I always kid with my CEO peers in the industry that we should write a book about all the email we get because some of them literally border on the ludicrous level I mean it's just so like how the cheese is sitting on a plate then touching will be a question and then you have significant serious issues where we've really you know harm someone for a piece of a flight cancellation and so you have to deal with those two differently but there's a lot of complaints about a lot of different things but increasingly with modern technology we're able to focus our surveys get a good understanding where the issues happening and deal with that issue specifically so now you have a theme of Rhapsody in Blue by Gershwin being using it for many many many years have you thought of changing at different different tune or is it so popular you don't want to change you know we've we've tested that and there's an overwhelming level of support both from contemporary people and more people in different generation where it's just it's just very very much an iconic thematic that's tied with our brand that I don't think we're going to change anytime soon okay so when you're not running the airline what do you do for relaxation now can you ever get away I mean obviously you've got the health issue but you have to be careful about what you are running anymore do you have any hobbies what do you do for yeah like everyone else in the room are all active weekend golfers and tennis players and everything I've had part of my surgery and medical issues harm my right hand so my right hand doesn't work as well which helps me with my golf handicap but no I kind of we do I do everything I don't surf as much as I used to which I miss but generally I don't feel I have any restrictions so for young people coming out of college why would you say the airline industry is a good industry to be in I'll tell you if you want I mean we we struggle in this company with providing sort of the jobs and jobs for all a wide group of people we have in this industry some of the best jobs in America I thought we were just talking about it today I mean it's like you know pilots make a a very nice wage our technology our tech ops people people that maintain our aircraft that's an incredible level a job that pays I mean upwards of $50 an hour so we and the benefits that we provide as an industry are great there are some significant jobs that we the industry keeps hiring for as we grow the business so we don't get a lot of credit for that kind of ability so if you want to tell you know people around you and the communities that you serve and folks that are looking for you know wonderful jobs you know getting the maintenance that it's called an AMT a certification and and the the tech ability to fix an airplane it's a great job and if you the flight schools or grain as well we we have an argument about whether we have shortage of pilots or not but eventually we will so those are two meaningful really high-paying jobs along with everything else that we do in the business but we're a great place to work and I noticed that some of the international airlines some from the Middle East they now have first-class where you have like a mini a couple throw a couple condominium I call in condos in the front and do you have any of those or no you know space real estate on an aircraft is incredibly valuable and for us in America where we don't have the benefit of governmental subsidies to support our flying we have to earn our own keep so to speak so every inch of every aircraft is very highly tuned I've heard you ask questions about the size of our laboratories our bathrooms they're there there there's there's there's space to fit the need and not for luxurious relaxation ends on the need I guess but okay so as you look back on the future or look ahead on the future what do you think the biggest changes the industry will see are there you're gonna have people no longer need tickets everything can be just on their on their eyes or well again back to this issue of reliability flexibility and communication I think digital on the communication side is going to be great I think you know we talk about security and what a what an issue that can be the TSA folks are working wonderfully with our industry but being able to have biometric scanning things that we you're a known traveler we know who you are we know your family and we should let you go through a little bit easier than people we don't know so you're gonna see a whole broad aspect Ellucian so it's more digitally oriented or let's suppose our final question for you would be this let's suppose I have three airlines to pick from American Delta United to fly across the country and they're all the same price why should I pick United over your peers is there anything better about your airline than the others remember Delta's here - oh but yeah no no I think you know what I would say clearly your bias I'm biased but despite what you may hear and what you may have read over the last 12 months or so this is a great company with importantly probably of our greatest and most valuable asset is our humans and our people that work with us and the level of spirit and service and caring that they're going to be increasingly given to you I think it's gonna make the difference that Plus digital is it always be but I think the human aspect we forget we are a person-to-person human to human business and all the other things don't matter as much right so no regrets about taking the job you don't think if you'd stayed at CSX you wouldn't have had your heart transplant right you would have happened anyway is that right the a progressive under 'fl academic and theoretical term but I don't it's not practical I love what I do I love my company before and I really love my United family today so no regrets at all all right well thank you very much good conversation
