United, Continental merger shows pitfalls of unifying airlines



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Posted on February 14, 2013 at 11:33 PM

"Let's fly together."

That's what Jeff Smisek, now the CEO of United Airlines, told reporters when his airline, Continental, announced a merger with United nearly three years ago.

"United and Continental are the right partners for the right time," Smisek said.

United and Continental's planes got repainted, but the airline didn't make a smooth transition into one entity.

The carrier was hobbled by computer glitches. A seamless union of computer systems is essential for everything, from keeping track of reservations to scheduling crews.

Scott McCartney, who writes "The Middle Seat" column for The Wall Street Journal has followed the lurches.

"The did the computer switch [to one system] in March of 2012, and they were near the bottom of all carriers in on-time performance," McCartney said. "They had completely messed up the scheduling. They had crews on schedules they just couldn't meet. And at the end of the summer, they had to throw up their hands."

Smisek apologized to United customers more than once. The carrier lost $723 million in 2012, a year that was profitable for most big airlines.

American and US Airways presumably have been taking notes on United struggles, McCartney said. But every merger has unique problems.

"In some ways, the first year [of a merger] is the easiest year, because nothing's happened yet," McCartney said. "Years two, three and four are the hard years."

He looks for the third year to be the turning point in the American merger.

E-mail bharris@wfaa.com