UAL's Tilton Talks Value For Corporate Accounts And Inaction On Amadeus Transition

UAL Corp. chairman and CEO Glenn Tilton spoke at the airline industry's Wings Club in New York Thursday, and focused his prepared comments on familiar topics: taxes are excessive, infrastructure is inadequate, regulation is outdated and industry behavior is dysfunctional. He talked about possible industry consolidation, but was reluctant to answer analysts' and reporters' questions about the JAL saga beyond saying he hopes it continues to be a distraction for his two primary competitors. Tilton also answered a few questions of mine on corporate accounts and information technology. [more]
Tilton mentioned the importance of corporate accounts when he was speaking to the crowd about the Continental-United alliance after his prepared remarks, and later said corporate accounts were "very important." He said they were delivering a lower percentage of United's revenues than before the Lehman Brothers collapse in fall 2008, and that what's different now is, "We're trying to match our product delivery and the value of our product offering to them to meet whatever budgetary constraints they have imposed upon themselves. Said simply, against this economic environment rather than the prior economic environment, we're trying to create good value for money so they get back out on the road again. We're trying to be a stimulus to business travel, so business travel can be a stimulus to economic recovery." Asked by another journalist about holding corporate accounts to volume commitments in contracts, Tilton said that if clients miss their volume targets for reasons that are not within the client's control, "we'll work with them on it. A reason that is not beyond the control of the client is just opportunistic."

Meanwhile, Tilton acknowledged the timetable of United's move to the Amadeus common IT platform "has changed. ... As the partners change and the requirements of the partners change--so as each alliance changes--it brings in a little bit of complexity in that they bring their own legacy systems. So we may move back a little bit, but I think the idea of a common platform between alliance partners is a very good idea."

Okay it wasn't much, but it was more than United said when Amadeus first admitted to the delay, which was nothing.

Incidentally, AMR Corp. CEO Gerard Arpey this week said he expects the company to sign "in the near future" its definitive agreement with Hewlett-Packard for the Jetstream reservation system that AA and H-P announced last year just after The Beat reported that Amadeus and United were stalled and Air Canada would not push forward with the ITA Software res technology. "We announced last year that we had signed a memorandum of understanding with HP on that project," said Arpey. "As we sit here today, we have not signed a definitive agreement. We have been engaged in very detailed and comprehensive and good conversations with HP. We just hadn’t pushed it over the finish line yet, but we’re still heavily engaged."