United CEO Issues New Statement Amid PR Disaster; United Airlines in Damage Control Mode.
QUEST: The message is clear tonight from United Airlines' chief executive, "I promise you we will do better," says the chief exec, Oscar Munoz. With a new statement in the last hour -- let me read you, "The truly horrific event that occurred on this flight has elicited many responses from all of us: outrage, anger, disappointment. I share all of those sentiments and one above all, my deepest apologies for what happened. Like you, I continue to be disturbed by what happened on this flight and I deeply apologize to the customer forcibly removed and to all the customers aboard. No one should ever be mistreated this way." It goes on, "I want you to know we take full responsibility and we will work to make it right. It's never too late to do the right thing." By any standards, this has been a public relations nightmare for United, which has lasted two days. The shares opened down roughly about 4 percent. At one point a billion dollars was wiped off United's value. But by the time the day was over, shares with off just 1 percent at $70. All because of these pictures that you've seen over and over again.</s>UNIDENTIFIED FEMALE: Oh, my god. Oh, my god. [SCREAMING]</s>UNIDENTIFIED FEMALE: Oh, my god. Oh, my god.</s>QUEST: I don't think anybody would disagree with Munoz's description of this as truly horrific. Particularly if you think about the man that actually paid for a seat. Several passengers filmed the scene at Chicago's O'Hare. The man refused to give up his seat and was forcibly removed by three Department of Aviation security officers. The man then ran back on the plane. His face had been bloodied by the encounter. It's believed he hit his head on the seat arm as he was forcibly removed out of his seat. Our aviation correspondent is Rene Marsh and joins me from Washington. Oscar Munoz says tonight it's never too late to do the right thing. Now, you can argue, Rene, it was going to take time to put together a considered response, which is what we've got tonight, but it begs the question, why on earth they put the other two out when this is the one they need to.</s>RENE MARSH, CNN AVIATION CORRESPONDENT: You know, Richard, when I saw this statement, the first thing I thought was, third time's a charm. Because, you know, this statement that you talked about, that came out just a short time ago, this was the CEO's third message, and he final got his tone right. It took two days of viral video and just fierce outrage from just about anyone who saw that video before the airline made this sort of direct apology to the passenger who was dragged off of that flight by the arms. And it was because that flight was overbooked on Sunday night. Now, I do want to add that the CEO said that there would be a thorough review of how the airline handles oversold flights and that it will be looking at how it works with law enforcement. He said that this review would be completed by April 30th. So of course, we'll be watching and waiting on that. But as you pointed out, you know, this comes after he doubled down in an email that he sent to employees, defending the flight crew and calling the passenger disruptive and belligerent. And then his very first statement, he only apologized for having to re- accommodate passengers. This really has been a disaster, to put it mildly, for the airline. It's really been crickets also from the press office. They've kind of just gone into a hole, and occasionally quietly updating the website with a statement, but they really haven't been answering any additional questions from reporters covering the story. One last thing here, Richard, coming from Washington, we are starting to see lawmakers react. They are demanding the findings of the Department of Transportation's review of this incident. We reported yesterday that the Department of Transportation announced that it was going to be looking into whether that passenger's rights were violated.</s>QUEST: Rene Marsh in Washington, thank you, you've brought us up to date beautifully with the events of the day so far, thank you for that. We'll talk more about it, because United is being attacked on numerous fronts. The airline is not strictly at fault in each of the cases or at least it's at fault in the way they handled it, but that's if you go through them. First of all, the question of overbooking. Questionable whether this flight was overbooked, whether four crew members suddenly turned up late. But overbooking is a reality of the airline industry. And the truth is, it keeps the costs down for airlines and it keeps passengers' fares lower because the airlines can keep selling the seats. But the object is to get your overbooking just about right, rather than over-overbooking. Secondly, the passenger's removal itself. It wasn't United that dragged the passenger off. It was the Chicago police authorities or at least the aviation's responsible. And indeed, by the letter of the law, the passenger is obliged to leave the plane. United is taking responsibility and at least now saying they are responsible and they will put it right. But as Renee said, the true problem was the first two letters. The email and the statement. And the lack of apparent compassion to the staff that focused on keeping staff happy. Sara Nelson, the international president of the Association of Flight Attendants. She is also a former public relations director and flight attendant for United. You represent the flight attendants at United. Your organization does. Sara, all right, come on, brass tacks, Ms. Nelson. I mean, who is to blame here?</s>SARA NELSON, INTERNATIONAL PRESIDENT, ASSOCIATION OF FLIGHT ATTENDANTS: This was truly a disturbing scene. And as Oscar said, horrific. Aviation workers across the industry were identifying with this as totally horrific and need to be called out as such. But, you know, this was an escalating set of circumstances, Richard. As you know, flight attendants, as aviation's first responders have to manage conflict on board the aircraft all the time. And the way you keep problems from escalating to a bigger problem is to keep them off the plane. So much of this, many people are saying, should have been handled in the gate area, we would probably agree with that. So, Richard --</s>QUEST: Let me jump in. On the question of Oscar's letter yesterday. Now, we know morale has been pretty appalling at United. And we know that as a result of Oscar's policies and the way -- I mean, he's a thoroughly decent guy and a nice chap. But he's a good CEO, from what we can see. But his priority yesterday seemed to be keeping his own staff, that I empathize with you and stand with you all the way. That was significant for you, wasn't it?</s>NELSON: It was very significant for flight attendants. And there have been flight attendants across United's system, whether they are main line and part of the original operation or part of the express carriers such as this was on Republic, who have expressed incredible thanks for that. Because they are taking a beating out there. They were really not a part of this offensive, disturbing event. In fact, their job every day is to maintain order in the cabin. His immediate action to tell the staff, I stand with you to continue to fly right, not -- I don't stand with that sort of behavior, that wasn't his message. The employees heard loud and clear that this management team stands behind the people who make flying safe, secure for everyone on board and maintain that order in the cabin on a daily basis with thousands of flights taking off all the time. Richard, you know United really well. You have seen it through its ups and downs. And it really is a disaster place before Oscar Munoz became CEO. And my experience with Oscar Munoz, is that he is one who takes these issues very seriously. He is not one to sign off and let something go. He will delve into it. He will hold people accountable. The statement that was put out today is very much in line with who he actually is. My experience with him over the last year.</s>QUEST: So, if you take -- and let's not go back too far to United broke my guitar, we can all remember, that was a long time ago. But if we take leggings, and if we take this incident, and by "this incident" I'm not talking about the dragging off the plane, because that really is the responsibility of the Chicago law enforcement authorities. I'm talking about the incident leading up to the need to remove the passenger from the plane. Is this not an indication that Munoz and the senior team still have much work to do at UA?</s>NELSON: But United Airlines was so broken before he took over. And yes, there is still work to be done. But I will tell you is the employees immediately responded to his statement. And we are seeing an entirely different turnaround at United. This wasn't right until the statement that he put out an hour ago, like you said, that was desperately need. But the employees understood what they needed to do to keep the airline moving in a positive way. And as you put it yesterday, to fly right.</s>QUEST: Sara, good to see you, as always, thank you very much, Sarah Nelson, joining me. You're in Hawaii.</s>NELSON: Yes, I am. I'm talking to you from Hawaii.</s>QUEST: Sympathy has evaporated in Hawaii. Thank you very much for the beautiful weather that you're probably enjoying there. Thank you very much, Sara. Good to see you as always. At QUEST MEANS BUSINESS, we continue tonight. The markets, take a look and see. The big board was down very sharply during the course of the day, fell by about 145 points. Then it rallied, then it fell back a bit and then came roaring back up again. What a volatile day. It's all about uncertainty in geopolitical events. Which is what we'll talk about after the break. QUEST MEANS BUSINESS, good evening.