Breaking News: Jeff Smisek Resigns As United CEO

Sometimes if you wish for something long enough and hard enough, it eventually comes true. 

Jeff Smisek has resigned as chairman, president, and CEO of United Airlines.

smisek

From the press release:

United Airlines announced that it has named Oscar Munoz as president and chief executive officer. Munoz will also continue to serve on United’s board of directors. The board appointed Henry L. Meyer III, United’s lead independent director, to serve as non-executive chairman of the board of directors. The company also announced that Jeff Smisek has stepped down from his roles as chairman, president and chief executive officer, and as a director. These changes are effective immediately.

The move is apparently the result of an ongoing investigation into that famed flight to nowhere Ben posted about earlier this year — where, if you recall, United operated a little-used flight between Newark and Columbia, S.C. (where the Chairman of the Port Authority had a weekend home) at the Chairman’s request. The flight only operated on Thursday afternoons (Newark -> Columbia) and Monday mornings (Columbia -> Newark). When the Chairman resigned, the flight went away just a few days later.

The executive vice president of communications and government affairs and the senior vice president of corporate and government affairs have stepped down as well. Smisek will receive a $4.9M compensation package.

United-767

Mr. Munoz has been a United board member since 2010. He has previously served as president and chief operating officer at CSX, a “premier transportation company.” Which is to say a railroad. But hey, trains move cargo very cheaply….

My Thoughts

It’s hard to even know what to say right now. As a long-time United flyer, it’s been very sad to see the changes of the last five years. Whether or not these are all attributable to Smisek or just the current economic environment, he’s been a good whipping boy for most of the United premier flyers that I know.

While it’s true that things are never so bad that they can’t get worse, I’m honestly excited to see what’s behind door #2 in this case. And it will be fascinating to see what becomes of Smisek and the ongoing investigation.

What do you think?

Comments

  1. Sometimes the devil know don’t know is better than the devil you do.

    Just to, you know, keep the adage train rolling

  2. Travis –

    You’re giving me hope here: “Sometimes if you wish for something long enough and hard enough, it eventually comes true.” I wish I may, I wish I might…that Richard Anderson be gone tonight!

  3. “Knowing better is choosing better”

    As a former long time (non-disgruntled) employee it’s disappointing to hear, but internally satisfaction with him was low. The last 5 years at United have been tumultuous internally, it’s had began to bleed out onto our customers, despite the desperate containment and internal PR campaigns.

    I hope they choose better next time.

  4. I think UA has good bones especially the ones brought over from CO. now it’s a matter of getting the vast employee network to buy into a new “friendly” United. While I am extremely loyal to my current carrier ( 15 years) I am still a United flyer at heart and would consider going back both personally and corporately, possibly.

    Let’s see what happens it’s time for a “Big Bang”

  5. The accompanying scandal isn’t gonna help either. Perhaps Delta can buy the “new” United. 🙂

  6. I’m not sure what you mean by “current economic environment”? Planes are packed full of business travelers. Oil has dropped from nearly $150/barrel to under $45. It’s time to stop excusing his poor performance.

  7. My family lives in Columbia, SC, and I live in NYC. When I visit my family, I usually have to connect through Charlotte from EWR or LGA until I discovered this direct flight from EWR to CAE. I wondered why the direct flight went away. Now, I know.

  8. hope for the better…

    but wasn’t there something about how the ex-UAL CEO Glenn Tildon was horrible and should be outed, and when Smisek came on and was worse than Tildon, there was a “Bring Tildon back” or something….

    let’s hope the new guy won’t lead to the start of “Bring Smisek back” campaign.

  9. This all came to light during bridgegate and it was one more example of the incredible chutzpa and sense of entitlement that drive people absolutely crazy. The thought that that son of a bitch could actually think he could connive the airline to revive a route just for him and that the airline would actually DO it boggles the imagination. So I for one an glad Smisek is gone, sad he is getting so much money (don’t they always – and I’m a Republican!) and hope that Samson eventually ends up in jail.

    As for United, I couldn’t care less. What will be will be.

  10. Just remember, Smisek was fired because of the improper/illegal activity, not because of the airline’s financial performance.

  11. MS – And who is deciding his performance is so poor? Contrary to popular belief, airlines aren’t in existence to please the public, they exist to make money for shareholders. Has he really done so badly at that?

  12. No CEO resigns in this manner unless he is in deep sh*t with the federal investigation. I work in the FCPA/anti-corruption sector and the DOJ is trending toward indicting individuals rather than the corporations and with that comes criminal indictments and jail time, not just civil indictment like in the past. The old adage still rings true…absolute power corrupts absolutely.

  13. As much as I wish all United’s problems could be pinned on Smisek and the culture that flowed out of his leadership style, United’s been horrible since long before his tenure began.

    And as much as people like to point to CO as an airline that was “doing it right” and hope that airline’s culture somehow lies dormant in UA, truth is, it was horrible too.

    But back to UA. Their problems, from operations to Mileage Plus, are clearly too large and numerous to be blamed on any one leader or fixed by any one replacement.

  14. United is the Jurassic Park of the US Airlines. Their mindset is still from the time dinosaurs were their passengers. Time to modernize starting by dumping that stupid thing they call international first class.

  15. What he has done to UA has been criminal only fitting he goes to prison. MP was way better under Tilton. IPTE was started under Tilton, the SWU and CR1’s with the 500 system was so much better than what is happening now with FCM going on. The old UA tulip was a much sexier logo than the continental click art and the rhapsody campaign was awesome! Bring back Apollo! Make United Great Again!

  16. Callum, shareholders who bought United stock this year are probably down 15-20%, and it likely will be worse tomorrow with 3 executives fired. I would give Smisek credit if his stock outperformed his peer group, but that has not been true.

  17. Jeff, Nene and Mark were fired to limit the liability of the corporation. It is a standard practice. Jeff got a consolation prize that includes 60,000 shares; $3 million give or take. UA stock underperformed DL the entire term of Jeff’s reign.

    The computer meltdowns, chronic delays and a reservation system that defies any semblance of good customer relations did not help his case either. Jeff is a good example of someone incapable of running any corporation in the world. He never recognized the need to put the most competent person in charge.

  18. Don’t forget that Smisek announced a $3 billion stock buyback in July when the markets were trading at record highs. This was money that could have been spent on actually improving the airline.

    Who knows how far the stock will drop tomorrow with the corruption probe. Shareholders will be the ones left holding the bag.

  19. Well…I guess he wasn’t really needed…Richard Anderson was making all the decisions anyway!

    #copycats #delnitedairlines

  20. “Shareholders will be the ones left holding the bag.”
    That is the name of the game with a guy like Smisek, It was all about him and the board. Not company product or longevity, not business, definitely not integrity. Sooner or later after their millions were made the company, stockholders, customers and employees all loose. He is a greedy vulture. Coast to coast employees and frequent flyers are celebrating his departure.

  21. “Coast to coast employees and frequent flyers are celebrating his departure.”

    Who are these “frequent flyers” of whom you speak? I’m surprised there are any left at UA.

  22. UAL stock is UP 1.60% today. Even shareholders think United is better off paying Smisek to stay away from the company.

  23. I could imagine, though it’d be impossible, that one of the job requirements could be to have attained 1K status at some point. It’d guarantee the candidate had experienced the many customer facing facets of the company at least once.

  24. Boo Hoo Jeff, Maybe next time you will answer a letter that was sent to you under a “confidential, only to be opened by the addressed”, rather than giving it to a worthless underlink, Brenda Simpleton, to respond to a inexcusable United mishap . Serves you right. What goes around….comes around.

  25. With all the elites and million milers jumping ship to AA (which matches status and is still mileage flown based) I cannot believe retention of the best customers and overhaul of the mileage plus program after Smisek made it a joke is not a top priority.

Leave a Reply

Your email address will not be published. Required fields are marked *