United CEO says ‘we will be stronger’ after passenger controversy

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United Continental chief executive Oscar Munoz, who is at the centre of a consumer firestorm over the violent removal of a passenger from a United plane last week, apologised to all of the carrier’s customers but downplayed suggestions that the incident would hurt the company’s brand in the short term.

Speaking on an investor call on Tuesday, Mr Munoz vowed that United would learn from what the company called a “big failure last week”, when Dr David Dao was left with a concussion, broken nose and two lost teeth after he was brutally dragged from Flight 3411 by airport police to make room for airline staff.

Asked whether corporate bookings had fallen as a result, however, he said that while some corporate customers had expressed concerns, “they believe we will get this fixed and at the end of the day we will be stronger”.

Mr Munoz expanded on a string of apologies issued over the past week to say on Tuesday: “I want to apologise to all our customers… You can and should expect more from us,” adding: “We are and will make the necessary policy adjustments to make sure this will never happen again”. He said the incident would be a “true learning opportunity”.

He had previously been widely criticised for failing to understand the gravity of the event and failing to move quickly enough soon afterwards to apologise for it.

United officials turned quickly to stress the stronger-than-expected financial performance of the company, which on Monday announced adjusted first-quarter earnings per share of $0.41, above the market consensus of $0.38. United also forecast that second-quarter consolidated passenger revenue per available seat mile – a closely watched industry metric – would rise 1-3 per cent in the second quarter, the first positive unit revenue growth in two years.

Jim Corridore of CFRA reiterated his strong buy opinion on United shares, writing in a note after the results were released Monday that “revenues were better than we expected, and unit revenue trends are likely to improve in the second quarter. Fuel and labour costs were sharply higher, but were in line with our expectations. United said the right things regarding its need to upgrade its customer service and should be able to move past its PR nightmare, in our view.”

United shares fell 2.5 per cent on Tuesday after rising by the same amount on Monday in anticipation of first-quarter results.

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