This week’s featured link:
And it Turned in to a Boardroom Blitz – Wandering Aramean
I was debating writing a full post about United’s board room brawl, but I’m not quite there yet. I want to see what happens next. In short, United has activist minority shareholders (Altimeter and PAR Capital) that have a lot of history in this industry. And they’re trying to facilitate a board coup. The board tried to appease them by adding new outside directors, but it wasn’t enough. These guys are pushing for 6 of their own, including a new board chair in former Continental boss Gordon Bethune.
To me, the timing of this couldn’t be any worse. Had they tried this a year ago I think many would have supported the effort. After all, United was an airline under previous rudderless leadership that couldn’t get its act together. Yet now, with a new CEO, the signs are at least positive. We don’t know how it’ll turn out, but we know that he seems to be a uniter and people want to rally around him. If he doesn’t screw this up and surrounds himself with the right people, then this could be the beginning of a success story. If “stay the course” is ever a good plan for United, this seems to be the time to try it.
At the same time, bringing Gordon Bethune back into the airline could be one of the most divisive moves around. Gordon was a Continental guy. Those who are on the Continental side will clearly have rose-colored glasses and unreasonably high expectations. Those on the United side will expect another round of Continental rah-rah that’s just not needed.
I may very well have more to say on this as the fight unfolds, but for now, I’m just scratching my head at the timing.
Two for the road:
Amazon lines up fleet of Boeing jets to build its own air-cargo network – The Seattle Times
And the newest airline in the US is… Amazon. Ok, not really. But Amazon, which had been quietly using 5 freighters as a test, is now deciding that it wants to be in the air cargo market in a big way. It’ll have 20 767s via ATSG to help build a backbone to make it easier for goods to move faster and cheaper to get to customers. Combine this with its last mile plans to use drones, and you can see how Amazon becomes a formidable logistics company (even moreso than it is today).
Chasing the shadow of the moon: To intercept eclipse, Alaska Airlines adjusts flight plan to delight astronomers – Alaska Airlines Blog
This week there was a total solar eclipse, but it was going to be hard to catch. Alaska, however, had a flight from Anchorage to Honolulu that was going to be close. So, the airline moved the flight by 25 minutes to make sure it would fly through at the exact right time. The result is stunning, as you can see in this video from a very, very excited passenger.
I so agree with you regarding the timing of Altimeter and PAR’s actions.
The timing is horrible. Oscar seems to have the confidence of labor and seems like he is well positioned to pull the fractured segments of the United versus CAL teams together once and for all. I would have understood the shareholder activity if it occurred when it was needed….last year.
United is about to fail and go over a presipice. They are lucky that Bethune would even consider coming back. The Lorenzo style failure is at hand, with cheap oil, nobody sees it . The investors are not fooled by a heart transplant.
Bethune is not coming back to run the airline. He is part of a hedge fund looking to do what haedge funds do. Its motives are HIGHLY dubious. These guys are a bunch of sharks and they just might be smelling a little blood. These groups only have to smell the slightest bit and they are on to it like stink on poop.
I don’t think you know what you’re talking about. Bethune was the best thing to ever happen to United. Oscar, with health, was problematic at best running a railroad. The “tell” that UA is about to fail is the way they treat their longtime flyers. Their system is riddled with incompetence starting at the Willis Tower and flowing down from there. UA’s relationship with the unions sucks. Oil will rise to 70 by the end of ’17 and then the rats will scatter. Altimeter has been doing this a very long time and not new to UA’s board room. Jamie Dimon doesn’t have the old where with all that he had a Bank One. Chase will not be there to save UA’s plummeting fortunes this time. I have saved my old bag tags from Eastern, Braniff, TWA and Pan AM-guess who is next?
My dad will agree with you about how United is treating its longtime million-milers.
To me it sounds like United is heading for trouble, And I believe that airports that rely heavily on United (Houston-Bush Intercontinental) (Denver International) & (Newark) will be the big loser’s in this battle when all is said and done. I believe United will be a thing of the past in 3-4 years.
Not if Bethune can organize a restructure.
Answer me this, where do you think Bethune loyalties are?? You think he has Uniteds best interests at heart or his hedge funds????
These guys were sniffing aruond a little while ago. now, i dont shed any tears for the purged board. It should have happened a long time ago.
So your crystal ball says oil will be north of $70 in about 18 months then?? You could be right but put your money where your mouth is. you could make a pile of money. You sound likesome guys I knew that used to frequent the track FFS!!
I forget who said it but its so true and the quote goes something like this, “The market can remani seemingly irrational longer that your money holds out.”
You sound like just another Kool Aid drinker who is a Gordon Bethune fan boy/girl…..
On a completely different note, thank you for posting the video from Alaska Airlines. I hadn’t seen a video or picture from that flight. Even cooler than I thought.