Larry Kellner is Chairman and CEO of Continental Airlines. He joined the company in 1995 as a senior vice president and was named to his current post in December, 2004. He spoke to TravelAge West from the company’s headquarters in Houston.
Have you ever been stuck on the tarmac?
Yes. I remember sitting on the tarmac a couple of years ago. I was on a flight from Newark to San Diego and I had to be there to give a speech the next day. We sat there for two and half, maybe three hours. And I sure wasn’t happy sitting there. And there’s a lot of talk about what the cutoff is for sitting on the tarmac. But, we found that most people don’t want us to cancel the flight. A guy who has to be at a meeting the next day has to get there. And with the flights so full, even if we cancel, how will you find a seat on the next flight? It’s kind of like the freeways, because the air lanes we travel in are like highways. No one likes to sit in traffic.
But there seems to be an industry-wide crisis in domestic air travel, especially last summer. We read countless stories about delayed flights and horrific waiting times on the tarmac while food and water run out and toilets overflow, etc. How do you address customer concerns about this situation?
First, let me apologize to our customers. We’re not perfect. We can’t control the weather, but nor are we going to compromise on the safety side. There’s no question, it’s been a very busy summer. And one problem is an overburdened air traffic control (ATC) system in many parts of the country. It’s not broken yet, but it’s very stressed. I think that we are several years away from a solution about how to fix the ATC and how to take the burden off the system.
But what do you tell the customer who’s been sitting on the plane for three hours and is very frustrated?
Lots of this comes down to communications and expectations on our part. Sometimes, the guys in the cockpit don’t understand any more than our customers sitting in back do. It’s like being on the freeway and seeing all the cars ahead of you. And we know that frustration can begin at the beginning of a trip, with long lines at TSA, then a long delay, then sitting on the tarmac believe me, we at Continental are very sensitive to the traveler on all levels.
To be fair, Continental is not the worst offender, but there was a specific incident in July involving a Continental flight from Venezuela that was diverted to Baltimore and then delayed on the tarmac for five hours. What can Continental do to insure that this kind of thing won't happen again?
Even one hour is too long to sit on the tarmac. We had eight diversions to Baltimore that day. This one was an international flight. Baltimore is not equipped to handle international flights. The others were domestic flights, and there were no problems. And believe me; those crews were just as eager to get off the planes as our customers. The challenge for us is that every one of these situations is different. Baltimore was an isolated incident compared to some recent systemic failures at other airlines.
Let’s get back to ATC. You say that it is outdated, and that’s causing a lot of delays. How do you fix it?
The problem with the current ATC is that we are using radar-based technology. But you can take the existing technology and solve it. If you look at the GPS system in a car, you see what we can do. The airways are divided into highways. It’s a question of funding it. If there’s any silver lining from this summer, it’s the urgency to fix the system. Airlines are paying 90 percent of the cost and using 70 percent of the system. Private aviation is using the rest. I’m happy to have the airline industry fund the system, but we’ve got to have priority. And I’m worried about the new light jets coming on line with the air taxi systems. They will also use the ATC system. There’s a lot more demand coming.
How will the advent of two new super jumbo jets the 787 and the A380 change the long-haul business in general and for Continental in particular?
We plan to start operating the 787 in 2009. We have 25 on order, and they will fly some of the routes that the 777s do now. They are fuel efficient like the 777s are today. And by “going green” in that sense we win on all fronts when we make that capital investment. We got rid of the 727s and we installed winglets on our planes to reduce fuel consumption. We’ve also installed electric ground equipment, our baggage loaders and “tugs,” in Houston. It’s not just good to be “green.” In the business and environmental sense, it’s a win-win situation.
As CEO of a major airline, you have a unique vantage point form which to view the entire industry. What has been the biggest surprise since you took over at Continental?
The biggest challenge was that in 2004 when the oil prices shot up we had to determine whether it was temporary or permanent. And then there are short term shocks like Hurricane Katrina. I’m happy to say that we were back flying to New Orleans in a couple of days, but because of Katrina we had to reevaluate our backup systems. If what happened in New Orleans happened in Houston, our headquarters, the entire infrastructure of the city would go down. We’d be unable to operate. Now we have what we call our “bunker” about 60 miles north of Houston where we have our backup computers. We run lots of live exercises out there to test the system. For example, we might decide on a given day, “Okay, we’re going to run the airline out of the bunker.”
And does it work?
Yes.
