Skift Take

Did United Airlines promote its new Polaris cabin faster than was prudent? The answer is probably yes. But remember, in 2016, United was losing high-value customers to competitors. It likely wanted to make a splash by highlighting its future plans.

Like Steve Jobs introducing an Apple product, United Airlines CEO Oscar Munoz confidently took to a New York stage in June 2016 to introduce Polaris, a new luxury business class with direct-aisle access seats, special lounges, fresh bedding, meals, and amenity kits.

It was a seminal moment for United, an airline that struggled with quality issues under former CEO Jeff Smisek, who left the previous year amid allegations he had approved a flight to benefit a political appointee. Smisek led United when it evaluated seats, but much of Polaris took shape after he departed, with the airline choosing the name because Munoz liked the North Star reference. United, an industry laggard since its merger with Continental Airlines, was on the move, and Munoz wanted to reflect that.

But more than 16 months later, United’s Polaris class still confuses customers, a problem that may continue for the foreseeable future. United made a bet that travelers would be smart enough to know Polaris stood for two product types — seats and lounges that would take several years to install and build, and stylish amenities, better food, and new service standards that would come much faster, even on planes with older seats.

As promised, since November 2016, every United long-haul flight has operated with Polaris service, with Saks Fifth Avenue-branded bedding, improved food, and amenity kits, and, on longer flights, airline-issued pajamas. Flight attendants even roll out Bloody Mary carts and offer wine tastings.

Seats are a different matter. So far, United has retrofitted only one aircraft, a Boeing 767 that rejoined the fleet in September, with the snazzy blue seats. A few other planes are undergoing retrofits, but United has said it will be a several years before a substantial number of existing planes have Polaris seats.

In all, just 15 planes have the Polaris configuration, and 14 are Boeing 777-300ERs delivered with it in 2016 and 2017. Still, not even all new planes delivered since the announcement have Polaris seats, as United is still taking Boeing 787-9s with an older-model version.

While the last-generation seat on the 787s is reasonably competitive, United still has more than 30 Boeing 777s with what many flyers say is the worst flat-bed business class configuration on any airline — two seats by each window, and four in the middle. The new 777 configuration has one seat by each window and two in the middle.

“Sixteen months after this project went public there should be a lot more than 15 airplanes flying,” Brett Snyder, who writes the CrankyFlyer blog, said in a post this week. “Right now it feels a whole lot like the boy who cried wolf.”

By now, United was supposed to be further along, but its seating manufacturer, Zodiac, earlier this year had some production problems. In March, Munoz said he was “not happy” with Zodiac, and said United was dispatching employees to the production center to “expedite” manufacturing. Still, United executives always said retrofits would be a long-term process.

“We’d like it to go much faster,” Andrew Nocella, United’s chief commericial officer, said Thursday. “We’re looking at what to do that all the time. But when there are hundreds of aircraft involved, it is going to take a few years to roll out.”

Nocella made the comment during United’s third-quarter earnings call, which was dominated by more pressing financial issues, including the airline’s admission that passenger revenue per available seat mile, a rough measure of ticket prices, decreased 3.7 percent year-over-year. Overall net income for the third quarter was $637 million, off 34 percent from the same time last year.

While Polaris product issues are annoying to customers, they’re not material to United’s earnings. For analysts, a much bigger issue is United’s higher-than-expected costs, and its willingness to discount its prices to compete with ultra-low-cost carriers. On the call, Munoz said, “I just need a little more time” to reduce costs and increase profits.

Polaris Confusing to customers

The Polaris product also needs more time. Though seats were never expected to be a quick fix, United had hoped lounges in Houston, Newark, San Francisco, Washington, D.C., and Los Angeles would be completed this year. All are behind schedule, and so far, only Chicago is open. United is hopeful more lounges will open in 2018.

In his post, Snyder said this is probably disappointing customers, who expected to have access to the special buffet, better booze, and private cubicles, even if they knew they’d be flying in older seats.

“When you think about how many people have flown United internationally in the last 16 months, and you imagine the relatively small fraction that have used O’Hare, you realize that most travelers haven’t had the chance to try the Polaris lounge at all,” Snyder wrote.

On the earnings call, Nocella tried to steer the conversation to the overall Polaris product, saying United’s customer service scores improved after it introduced bedding, food, and service standard changes in November 2016.

“We have to remember there are many other components to Polaris,” he said.

But travelers, especially occasional ones, aren’t always that sophisticated. Many may think they’re getting the full Polaris experience, including seats and lounge access, only to be disappointed on the plane.

Compared to United’s pre-2016 service, attributes like champagne at boarding, plush bedding, an in-air wine tasting, and better post-dinner sweets are a major improvement. But if customers expected more, they may blame the airline for over-promising.

“I think United was probably at least two years premature in announcing Polaris,” Snyder said. “I bet some people over there now wish they had waited.”

U.S. competitors also improving product

Interestingly, United’s two main global competitors, American Airlines and Delta Air Lines, have made similar product enhancements, but rolled them out differently. Both have introduced products in stages, rather than at once.

Until recently, many of American’s wide-body airplanes had the worst long-haul business class seats of any U.S. airline, an angled flat seat introduced more than a decade ago. While American retrofitted aircraft — a process delayed repeatedly because of supplier issues — the airline made some service and amenity improvements, but unlike United, it did not announce full-scale product changes.

But now, with the retrofit project just about completed, American seeks to be more vocal about matching United’s product. Earlier this year, American opened flagship lounges at New York JFK and Chicago O’Hare for premium class passengers, with more to come. And on Dec. 1, American will introduce new mattress pads, duvets, pillows, day blankets, lumbar pillows, pajamas, and slippers for many premium class passengers.

Delta has also enhanced its onboard product, adding new Alessi-branded silverware, as well as crystal glassware, new bone china, and stainless steel serving pieces. Delta also recently started giving out pajamas on its longest flights.

But that’s a separate project from Delta’s new business class suite, debuting later this month on Airbus A350 aircraft. Delta has advertised the new suite but has been careful to say it won’t available fleet-wide. After the first stage of retrofits, the suite will only be available on A350s and Boeing 777s mainly flying Delta’s longest routes.


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Tags: airline innovation, business class, earnings, paxex, united airlines

Photo credit: It has been roughly 16 months since United unveiled its new Polaris cabin seat. But it has been installed on only 15 airplanes. United Airlines

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