A week after video of a passenger being dragged off a plane sent United Airlines stock plummeting, its CEO said none of his employees would lose their jobs over the controversial incident.
On United’s earnings call discussing first-quarter results Tuesday, Oscar Munoz expressed remorse once again for the airline’s decision to forcibly remove the passenger from an overbooked flight in Chicago, which caused uproar from the U.S. To China. But despite calls for Munoz to resign, the CEO of United Continental Holdings (UAL) said the company never even thought about forcing heads to roll due to the debacle.
“The buck stops here, and I’m sure there was lots of conjecture about me personally,” Munoz said, saying he’d had “fulsome” conversations with United’s board of directors in the wake of the incident. “There was never a consideration for firing an employee or anyone around it.”
Rather, Munoz blamed “a system failure across various areas” for contributing to the circumstances that led security officers to drag the passenger off United flight 3411 when he refused to give up his seat, leaving the man, a doctor, bloodied and injured. United had said it needed to bump passengers from the flight in order to make room for four of its own crew members who were required to be in Louisville, Ky. By the next day.
In the future, United Airlines “will never ask security to take a passenger off a plane,” Munoz promised on the call. Plus, to avoid situations where crew members seek to board a full plane when all passengers have already been seated, United will require employees traveling on the company’s aircraft to book their spots at least an hour before the departure time, the CEO said.
United may announce further changes to its policies around overbooking and customer service on April 30, after the airline completes an internal review of the factors that resulted in the public relations fiasco. Munoz, however, refused to say whether the company would end its practice of bumping passengers involuntarily altogether.
It’s too early to tell whether the dragging incident is costing United any business, United said, though Munoz is soliciting feedback from its most frequent flyers on how the airline can improve. “In that particular segment, at least among our highest-end customers, there’s been a lot of support,” he said. The CEO also paid a visit to the Chinese consulate in Chicago to discuss their reaction. Outrage had been particularly pronounced in China after the man kicked off the plane, David Dao, was identified as a doctor of Asian descent.
Yet while the overbooking issues were likely to have limited impact on United’s sales, Wall Street seemed more concerned about executives’ comments on the earnings call that the company was not seeking major gains in market share, but rather just hoping to restore its former position in the industry. United Airlines stock fell more than 4% by the early afternoon.
