US Airlines Industry - Survival of the Fittest

Its time now for airlines to restructure their activities and procedures to move in line with primary objective of achieving customer satisfaction which is declining at an alarming rate according to the University of Michigan's American Customer Satisfaction Index.

The analysis collected data from about 20,000 people during Q1 who were asked to rate companies, including 7 airlines, according to their level of satisfaction achieved. The reports showed that the industry scored a total of 63 when they had a potential for 100. The rating also declined by 65 points as compared to last year and is unfortunately the lowest since 2001.

"This is about as low as you can get," said Claes Fornell, a business school professor at the University of Michigan in Ann Arbor. "Companies with these types of scores don't survive unless they improve very rapidly."

The poor level of marks received showed a decrease in the customer level of satisfaction of U.S airlines’ services for reasons attributed to disenchanted employees, increasing fuel costs, bankruptcy, and also record levels of lost, delayed, and damaged luggage.

The Internal Revenue Service (IRS) was rated at a better position that the U.S carriers by the Americans.

UAL Corp.'s United Airlines and Delta Air Lines Inc., both of which were restructured under Chapter 11 in recent years dragged the airline industry to its worst rating ever.

Delta Air Lines was ranked second last followed by the United Airlines' which accounted for the most dissatisfied customers putting it last on the list scoring 59 and 56 points respectively.

United Airlines, The Elk Grove Village-based airline, emerged from a bankruptcy court protection in 2006 and also registered the largest year over year drop of 7 points.Delta, the third largest U.S airline dropped by 5.

AMR Corp’s American Airlines fared a slightly better position in the survey scoring 60 points after climbing up the bankruptcy line by winning employee concessions in 2003. Northwest Airlines which however is presently bankrupt scored 61 points and had a tie with the US Airways Group.

Dallas-based low fare carrier Southwest Airlines emerged as a winner out of the lot and was ranked first with 76 points. It, along with Houston-based Continental Airlines Inc. which scored 69 points, showed a positive growth rate of customer satisfaction over the last year.

"We've done as well as we have up to date by making sure our customers have a rich experience, and that's largely due to our people," said Beth Harbin, a spokeswoman for Southwest, which also is one of the few consistently profitable airlines.

The survey index examined various industries such as newspapers, utilities, health care, telecommunications and food service and rated cable television and satellite services even below the airlines.