United Airlines Inc.: The Manhandling Incident
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Case Code: BSTR568 Case Length: 15 Pages Period: 2017-2018 Pub Date: 2019 Teaching Note: Available |
Price: Rs.400 Organization: United Airlines Inc. Industry: Media & entertainment Countries: United States Themes: Conflicts of Interest, Stakeholder Management |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
The Practice of Overbooking
In the aviation industry, overbooking was a fairly common practice wherein airlines sold more tickets than the number of seats available. It was a strategy to ensure a full plane and maximize profits in case some of the passengers did not make it to a flight. If all the passengers who booked turned up, airlines typically offered travel vouchers to encourage some passengers to give up their seats. Each airline had its own system and procedures for deciding whom to bump. Some airlines chose to bump passengers who had paid the lowest fares, while others chose the last passengers to check in....
The Incident
On April 9, 2017, ahead of its scheduled departure time of 5:40 p.m. CST, the Louisville-bound United Airlines Express Flight 3411 began loading passengers at O’Hare International Airport, Chicago. The flight was operated by Republic Airlines Inc., on behalf of UAL. The 69-year-old Dao was among those on the flight. An American doctor, he was originally from Vietnam and possibly of Chinese origin...
Global Outrage
Viral videos of Dao being dragged down the aisle sparked a social media uproar worldwide. On April 11, 2017, the top trending topic on Twitter in the US was #NewUnitedAirlinesMottos, with users proposing slogans such as "not enough seating, prepare for a beating.” In an interview with the Wall Street Journal, President Donald Trump said the scandal involving Dao was "horrible". .....
UAL's Reponse
Munoz's first response placed the blame for the unfortunate incident on Dao. In a letter sent to employees on April 10, 2017, Munoz apologized to the other passengers on the plane, but did not refer to the treatment meted out to Dao. He defended his crew’s decision to deplane Dao claiming he had been "disruptive and belligerent." Munoz's public defence of the airline’s actions caused more outrage as lawmakers called for an investigation into the incident...
Exhibits
Exhibit I: United Continental Holdings Inc., (UAL): Income Statement
Exhibit II: Domestic Market Share of Leading US Airlines in 2016
Exhibit III: Performance Metrics of UAL and its Immediate Competition
Exhibit IV: Stock Price Trends
Exhibit V: United Airlines: Rule 25 Denied Boarding Compensation
Exhibit VI: Air Travel Consumer Report: Passengers Denied Boarding by U.S. Airlines
Exhibit VII: Complaint against US Airlines by Complaint Categories*
Exhibit VIII: UAL's Shared Purpose and Values
Exhibit IX: Stock Price Chart of UAL (April 5-April 12 2017)
Exhibit X: UAL'S Market Capitalization
Exhibit XI: UAL: Balance Sheet
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