Scott Kirby on Newark, safety & customer care

Note: Transcripts are automatically generated from episode audio, and are not fully corrected for spelling, grammar, and formatting.

Scott Kirby: Airplanes are a lot faster than the 1950s. The flight times from Atlanta to LaGuardia are longer than they were in the 1950s. While this became a story about Newark and staffing about Newark, it is nowhere close to unique to Newark. Every day in the system, there are places where we’re either having to slow down aircraft, reduce flights, delay or cancel flights. Everywhere in the country this is happening because the system is old and just can’t keep up with the demands. Every year stuff happens. Just got to figure out when something bad happens, how do I turn it into an opportunity?

Bob Safian: That’s Scott Kirby CEO of United Airlines. I wanted to talk to Scott because United has found itself facing a torrent of attention after an air traffic outage at Newark Airport, attention that Scott admits he didn’t anticipate. We talk about air safety and FAA staffing, as well as United’s new partnership with JetBlue, its adoption of Starlink for Wi-Fi services and support for what Scott calls the plane of the future. Plus, Scott gives us exclusive insight on why United check-in deadlines have been in flux. So, fasten your seat belts, I’m Bob Safian, and this is Rapid Response.

[THEME MUSIC]

I’m Bob Safian. I’m here with Scott Kirby, CEO of United Airlines. Scott, thanks for joining us. Thanks for being here.

Kirby: Thanks for having me. Looking forward to it.

Copy LinkInside the chaos at the Newark airport

Safian: So I have to start by asking you about Newark Airport. When I mentioned to folks I was talking to you, everyone’s like, “What’s going on?” I know United runs 70% of the flights out of Newark. It’s your primary international hub. Back in April, air traffic control there lost contact with planes in the sky for about 90 seconds. Can you take us back to that day for you? Where were you? How does the news come to you? Do you hear about it like the rest of us from the media?

Kirby: Well, that’s an interesting way to ask the question because to us, this is routine is probably not the right word, but things like this happen around the country all the time. And the point of it is it has an operational impact, but it doesn’t have a safety impact. So, in air traffic control, there’s three levels of a pyramid. There’s the TRACON, which went down, there’s also the tower and there’s the center. And so what happens when any one of those has any kind of issue, you just move to one of the other two systems. So, there’s three air traffic control systems. If it ever happened that all three of those somehow went down, which has never happened before anywhere in the country, but if it did, the pilots have a separate system called TCAS onboard the airplanes, which is the equivalent of radar, and they can see every airplane in the sky. So to me, it was an operational impact for customers because it slowed the air traffic down, but it was never a safety issue at all.

Safian: So you don’t get pinged when something like this happens? It’s almost like, I don’t want to say it’s expected, but it’s a possibility that could happen any day?

Kirby: I get a note about it, but it’s the same kind of note I get about weather when there’s a weather issue. Because for us, this has the same impact as when the ground closes for lightning, when there’s a lightning near the airport and the airport closes. It’s exactly the same. Airplanes go into a holding pattern. Then when the airport opens up, they come back in. And that happens almost every day. So, while this became a huge issue publicly, the reality is nowhere close to the perception. The reality is it was never a safety issue. And the good news is now the FAA has done the things that Newark that we’ve been asking them to for a decade, and Newark is actually now the most reliable of the three New York airports.

Safian: But as you talk about it, were you surprised that it became as big a public Because for you it’s just like, “Oh, this is another one of these things.”

Kirby: Actually, if I am self reflective of it, which I am, I try to criticize myself, it took me 24 to 48 hours too long to realize this was a perception issue with customers. Because it’s just so foreign to think it’s a safety issue because I’m 100% sure it’s not a safety issue, 100% sure it’s not a safety issue. And so for others to think that was just hard to Two plus two doesn’t equal five. It was hard to contemplate. But I quickly realized that in today’s media environment, airlines are sexy industries for better or worse. Anything happens in airlines and people want to talk about it. And it was easy to make a story of, the radar communication went down as a safety issue, without people understanding, okay, but there’s two levels of backups at the FAA or two different facilities. But it took me a little bit to understand that that was the case, but as soon as we did, we were out on the world tour. I’ve done more media than I ever thought I would do about an issue like this.

Safian: Yeah, so you chose to cancel a bunch of United flights around Newark to make these guys a little less busy, but I was thinking it’s not like that many flights. Was that choice as much about sort of making people feel safer than a safety issue on its own?

Kirby: No, it’s really about what the airport can support. And the key to a crowded big airport like Newark is to have effectively slot controls, whether they’re called slots or something else. By the way, Newark Airport, prior to this, was the only large constraint airport in the entire world that I know of that didn’t use slot controls. A lot of just crazy government history for how that happened. But what was happening at Newark is, the air traffic control could say, “We can handle X flights per hour,” and the airport would be scheduled at X plus some number of flights. And when that happens, it’s just common sense, it’s just math, flights get delayed.

And this has been a problem for a decade at Newark and we have literally begged the FAA to fix it, because they’re the only ones that can fix it. Because United Airlines, we’ve done it a dozen times, we cancel flights and then somebody else just backfills them in the peak hours. And so not one airline can’t fix it. And the really, really, really good news out of all this, as tough as it’s been in the short term, is that the FAA is now managing that. They now own it, as they always should have, but I really appreciate Secretary Duffy and acting FAA Administrator Rocheleau for actually finally owning it. And what that means is Newark is going to be a really reliable airport now.

Safian: And so when they step in, then they’re the ones who are limiting the amount of flights to match the number of slots?

Kirby: Correct. And so essentially there was another problem at Newark. There’s only two parallel runways at Newark and one of them was being down for resurfacing. That happens about every decade. That runway is back up in service now. But the normal airport you think can run 38 departures and arrivals per hour approximately. The FAA is now limiting it to 34. That’s to help with their staffing constraints that they’ve got at Newark. It’s truly about staffing at Newark. By the way, customers can now book with confidence because the airport is scheduled at 34 operations per hour for the balance of the year, so you can book and know that your flights are going up.

Safian: And the staffing that you allude to, there were air traffic controllers at Newark who took leave for trauma and stress, which you called a walkout by employees, which could sound a little harsh. You sort of feel like this was business as usual and maybe they were overreacting?

Kirby: Well, the air traffic control system, this is not unique to Newark, is short-staffed across the board, 3,000 controllers short. While this became a story about Newark and staffing about Newark, it is nowhere close to unique to Newark. Every day in the system, there are places where we’re either having to slow down aircraft, reduce flights, delay or cancel flights. Florida, Jacksonville Center has been one of the worst. It’s across the entire country. The air traffic control, they’re supposed to have 13,000 controllers and they’re about 3000 controllers short. And so this staffing issue is across the entire country. It’s one of the things that the secretary is focused on fixing. It’s the biggest thing we can do to make air traffic more reliable. It has been the biggest thing for a long time, just get the air traffic control system and the air traffic controllers back up to full staffing.

Copy LinkThe need for modernizing air traffic systems

Safian: And so it’s people more than it is technology? Because here’s also some talk that there’s out of date technology that could be improved at airports.

Kirby: It’s both. So, the people is the biggest issue to get fixed, the biggest bang for the buck, just getting back to full staff.

Safian: And I guess the fastest, if you can get those people.

Kirby: And certainly the fastest, but the technology also is… We have all these redundancies built into the system. It’s slow, three backups for the systems because of the technology being old, so the whole system can run faster. There’s millions of man hours lost every year of customers and flights being delayed everywhere in the country. Again, everywhere in the country this is happening because the system is old and just can’t keep up with the demands. It takes longer to fly up and down the east coast, I heard Delta say it, airplanes are a lot faster than the 1950s. The flight times from Atlanta to LaGuardia are longer than they were in the 1950s. That’s because the technology, it’s safe, but the technology makes it much slower. You’re burning fuel unnecessarily. It makes it more expensive for everyone, it wastes time.

If you’re going to fix infrastructure in this country, there is nothing that even comes close to modernizing the FAA. By the way, I think that there’s broad bipartisan support for this. The administration supports it. Secretary Duffy supports it. It’s figuring out the complications up on the Hill of getting what are the vehicles and how to get it through. But if you got to an independent vote on the FAA, my guess is it would pass with 90%, with broad bipartisan support.

Copy LinkDOT’s management of DOGE

Safian: DOGE has done job cuts to the FAA, which you’ve been sort of happy about or been in favor of. There’s something about that that I feel like people maybe are misunderstanding. Can you square that for us?

Kirby: Sure. I think the Department of Transportation and Secretary Duffy get the gold star for how to manage DOGE, which was when Doge came in, they didn’t let them just fire everyone that was a probationary employee and just whack out whole departments. They put caution tape around all the critical functions, the safety-related functions, all the operating functions. And I think they have a hundred something thousand employees. And at least what I know of in DOGE, they cut 400 back office jobs, 400 out of a hundred something thousand back office jobs, the kind of thing that routinely happens at companies, by the way, the kind of thing that should routinely happen at government, but it’s less than 1% at DOT. At some other departments, I think, it didn’t get managed as well, but at DOT, I think it got managed well. And I am not worried about the impacts of DOGE on the DOT.

Copy LinkHandling uncertainty in the airline industry

Safian: So much of our relationship with flying is about trust. Statistically it’s super safe. Episodes like Newark and some of the other incidents recently, the crash in DC and the plane that flipped in Toronto, it makes people worry. So, how do you think about how you re-instill confidence?

Kirby: I wish everyone could be behind the scenes at the kinds of things we’re looking at when anything exceeds any kind of tolerance level and how do you prevent that and how do you prevent accidents from happening? Airlines, and particularly in the United States, are not just the gold standard for safety. I literally bet we’re 100 times better than the second best industry. So, part of what we do is have a great track record, but talk about it more, and even talk about it with more specificity.

When I just say, “Oh, Newark is safe,” I can tell people are like, “Maybe,” but when I say, “There’s three layers of FAA safety and a fourth backup layer on our airplanes,” they’re like, “Oh, I didn’t know that.” So, we got to have more specifics, I think, sometimes and get out and talk more specifically. One of our pilots came and talked to our board about the Newark outage. He’s like, “90% of the pilots in the air 98% of the pilots in the air didn’t even know there was a radar outage. To them, everything was routine.” It’s like weather. For them, it really was routine. And we know that, but we need to help the public know that too, so that they have confidence.

Safian: Yeah, I often remind myself or my wife when she’s worried about me traveling, I say, “The most dangerous part of my travel is my car to the airport.” That’s the most dangerous part .

Kirby: I say that to a lot of people all the time too, and it’s 100% true.

Safian: Hearing Scott talk about the breadth and volume of flight adjustments that airlines have to make for all kinds of reasons, it’s a great reminder that leading a scaled organization is never predictable. And the bigger you are, the more potential troubles that may find their way to your desk. So, how do you take control of the situation and drive your own agenda without getting distracted by the turbulence? We’ll talk about that after the break. Stay with us.

[AD BREAK]

Before the break, United CEO Scott Kirby talked about the air traffic safety concerns at Newark Airport. Now we dig into the uncertainty facing all airline businesses and what United is doing to position itself for the future, including new deals with JetBlue and Starlink. Plus, Scott shares his one golden rule for beating jet lag and why he thinks old fashioned reading gives him more insight than AI. Let’s get back to it.

Copy LinkUnited’s partnership with Jet Blue

I’d love to run through some other news with you. You unveiled a partnership with JetBlue recently giving United access back at New York’s JFK airport. Very big news for JetBlue, which has been looking for traction after its merger with Sprint was blocked. How significant is it for you? You’ve made clear you’re not looking to merge with JetBlue, but what about this arrangement is important for United?

Kirby: Really, it’s two things. First is creating a partnership to give our customers a more expansive network. We’re the biggest airline in the world, but we’re not big everywhere, and JetBlue is really big at JFK, of course, big in Boston, big in Florida, big in the Caribbean, so places that we are not as big in giving our frequent flyers and our customers access to that expansive network on an airline that I personally have a lot of respect for the brand, the culture, the customer service DNA, that just exists. The second one is getting United metal back into JFK. United exiting JFK happened before I was here. In fact, I tell employees it’s partly my fault and maybe a lot my fault. I was the President of American Airlines and I had a goal to push United out of JFK and we succeeded and I celebrated. Then I come here like, “Oh God, I wish that hadn’t happened.” This gets us back in with our metal in an important market.

Safian: United metal is a term I didn’t know.

Kirby: Our own aircraft flying.

Safian: Putting planes on the ground, right?

Kirby: Yeah, putting our own planes in the airport.

Copy LinkInnovating the in-flight experience for travelers

Safian: You also recently launched flights with Starlink internet service. You announced new premium Polaris Studio Suites for the big spenders. The in-flight consumer experience like the bar has to keep going up. It has to keep getting better?

Kirby: We’ve also significantly upgraded the coach experience; bigger screens for customers, improved entertainment. We are focused on winning brand loyal customers at United Airlines. Innovation is a word that I think is overused. I love innovation, but it gets overused. And I think of it as every year we have to do new things to surprise our customers and our employees, something that nobody else has ever done before. We have the best app. We have all kinds of things that were the best, but you only get so long that before people take that for granted, as they should, and that it’s up to us to every year be coming up with big new things that customers get on the airplane “Wow, I didn’t think an airline can do this.”

Safian: That’s a tough bar. Sometimes I am on the ground and I look at a plane flying overhead and I think, “There are people up there who are complaining that their Wi-Fi is lagging, and they’re 30,000 feet in the air getting served, food and drink.” We get used to these things so quickly.

Kirby: As we should. And some of those things are hard. Wi-Fi is an example. It’s a lot harder to connect Wi-Fi for an airplane flying 35,000 feet above the ground, going 500 miles per hour. Starlink actually is the solution. All the others suffered from – they’re probably pointing at geosynchronous satellites, which are 26,000 miles above the earth and they’re in one location. So, the airplane is moving. We also have these moving parts on the antennas that have to move to point at that satellite. What makes it really work is you have thousands of satellites passing overhead in low earth orbit, so there’s low latency.

The speed of light is what it is, 26,000 miles. It takes a third of a second from signals to go back and forth. You don’t have any of that when you’re in low earth orbit. And there’s so much more bandwidth and connectivity, and you’ve taken that moving part out. But it’s up to us. We can’t complain about, “It’s hard.” We have to work with people to find solutions. Our new initiative internally is called Change the Unchangeable. Take those things that people have said are impossible and figure out how to fix them.

Copy LinkAligning sustainability with financial performance

Safian: Another new United partnership recently with JetZero, which is designing what you’ve called the plane of the future, better fuel efficiency, lower operating costs. I was curious, is any part of it about environmental impact? We haven’t heard as much talk about sustainability from business leaders in recent months.

Kirby: Obviously, it has much lower environmental impact because it burns less fuel. We’re in the situation that, I guess, an unhappy coincidence that things that are good for us economically are also good for the environment. Our second biggest expense is fuel, behind employee expense, so anything we can do to reduce fuel burn is good for the environment, is also good for us financially. And so we never have these questions that I hear other CEOs get about, “Are you going to prioritize sustainability over financials?” They’re aligned. We’re completely aligned. Anything we can do to have it produce a sustainable aviation fuel, for example, if it’s produced from corn or from fats, oils and greases, something other than oil that comes from the Middle East or from Russia, we reduce our exposure to the volatility of global events, we’ve kicked cost certainty and we’re doing something that winds up being good for the environment. So, our environmental and financial interests are 100% aligned.

Copy LinkBuilding resilient teams and fostering confidence

Safian: The economic climate’s been crazy this year. Delta notably pulled its financial guidance. Other airlines followed suit. You presented what you called a bimodal outlook based on two different economic scenarios, but the level of uncertainty and disruption, it’s kind of unprecedented. How do you plan in that environment? Is a different kind of leadership required when you’re operating in that environment?

Kirby: Well, I think that’s one of, actually, the key jobs of leadership is dealing with uncertainty. I’ve realized, particularly as a CEO, the only decisions I should make are the decisions that only I can make, meaning they’re big, there’s not a clear answer, there’s uncertainty. And so those are the only times I really should make decisions and I should build a team that makes everything else. Build yourself a plan that you’ve got flexibility. Set yourself up so that you don’t need to make short-term decisions. One of the big things we did is we had three financial pillars carry triple the cash on the balance sheet we had pre-COVID, get to industry-leading margins, pay down debt on the balance sheet.

That gives you the financial firepower to sort of not worry about the short-term. I am focused on where we want to be in five to 10 years, not where we’re going to be in the second and the third and the fourth quarter, because volatility is going to happen. There’s no point in complaining about it. Whether it was this current economy, or every year stuff happens. My favorite business philosophy is what I learned at the Air Force Academy, which is, “No excuses, sir.” Everyone should focus their whole life, living with no excuses. Just got to figure out when something bad happens, how do I turn it into an opportunity? And so I don’t stress at all about the uncertain environment. The truth is too, environments like that create opportunities for the leaders to expand their lead.

Safian: And for your teams who could be distracted by a lot of these changes that are happening externally that are not things that are in your control, how do you advise them or talk to them? How would you advise other leaders to kind of think about Someone I was talking to was saying, a CEO, “I never used to look at the stock market during the day, and now I feel like I have to watch the news every moment because I never know what’s going to happen next.”

Kirby: By the way, I started this during COVID, I used to watch the stock market all the time during the day, and I have stopped. And sometimes I don’t even check it at the end of the day, I’ll forget. It is so liberating to not have your emotions tied to, “Oh, the stock just went up or down.” I can’t believe I used to do it, but I spend a lot of time with our employees. In fact, later today I’m going to get on with a group of new international pursers, flight attendants, and I’m going to do a captain’s leadership upgrade class. I talk to all the captains when they’re upgrading to captain. And I get this question often, “What about our session? What are the risks? What should we do?”

And what I tell them is, “We’ve set the company up financially so that you don’t need to worry about it.” Coming out of COVID, I had a goal that we would never again have a furlough at United Airlines, that we would have the financial wherewithal that when the inevitable downturn happened, that we could stay focused on the long-term, we could keep growing. It’s my job to provide that certainty to them so they don’t have to worry about it, and they can stay focused on taking care of the customer.

Copy LinkPutting customers first in operational decisions

Safian: Between taking care of your customers on one side and taking care of your employees on the other, sometimes I notice you up the check-in time from 30 minutes ahead of flight time to 45 minutes. Is that one of those things where you’re kind of balancing what’s better for the customer versus what’s better for the team?

Kirby: I think we actually may go back to 30 minutes. This is one of those things that it’s so down in the weeds, none of us even knew it was changing, to be honest with you, which is fine. We empowered the team to make changes, but it created a lot of press, obviously, in a way that wasn’t expected. In a way it wasn’t even known. We do empower the team to make decisions at a lower level. No one thought that No one that made the decision would’ve thought that was going to be a newsworthy item, but it’s airlines again, and so it’s newsworthy. But it’s a good opportunity to step back and then say, “Is that being done for the customer?” And it should only be done for the customer. And that’s why we may change it back, because when you step back and think about it, the rationale for the customer would be, somebody gets there 35 minutes and they’re not going to actually make it to the airplane and they’re going to miss the flight.

So, we’re kind of going through: is this good for customers? So we have this program called Connection Saver where we’ll hold airplanes on the ground. We save about 2000 customers a day. Everyone that’s made connecting flights has had this happen to them or seen it happen at airports where you run through an airport to get to your connection, and they slam the door in your face and you’re angry and it’s the airlines fault. And it’s just transformative to change that. But everything we try to do, including this policy, is focused on doing it through what is best for the customer lens.

Copy LinkScott Kirby’s advice for flying and managing time

Safian: As an airline CEO, you fly constantly. Do you have any advice for our listeners about addressing jet lag or are you personally immune, it’s like it’s never been an issue for you?

Kirby: I’m not immune. This week I had a two day trip to India where I was 35 hours on airplanes and 51 hours on the ground. It’s 10 and a half hours away, so it’s like the opposite side of the world. And they have me scheduled from 7: 30 in the morning till 10 o’clock at night. So, usually I’m pretty good, but that was a hard trip. My advice is sleep anytime you can. Don’t over-manage it. Any chance you get, sleep. When I was in India, I was driving between venues and it would take 30 to 45 minutes. I laid down in the back, sometimes on the floor because there wasn’t another place to lay, and it took a 30-minute nap. Sleep anytime you can is my advice.

Safian: As you’re mentioning sleep, I’m thinking I heard that you have seven kids at home, is that-

Kirby: I have seven kids. I do. It’s awesome.

Safian: I’m guessing that’s another recipe for not getting a lot of sleep.

Kirby: I sleep eight and a half hours a night, and get more sleep than almost anyone you know. I put the kids to bed when I’m home. The truth is I get them all riled up, and my poor wife has to come behind me and actually calm them down to go to sleep. But it’s fun. When I’m here, I have breakfast with them in the morning. I try to take them to school anytime I can. So, lots of sleep, lots of time with the family. The key to that is don’t schedule meetings. I have a guideline of no more than four hours of meetings on my calendar a day. This is one of the best things people can do for their careers, I think, is stop with all the madness of meetings, where you just drain PowerPoint slides, and you don’t learn anything. And just you need time to think, to come up with ideas, to be creative, to walk around, to talk to other people, and you can’t do it if you’re sitting in meetings all day.

Safian: And it allows you to better juggle your work and family life. Do you have any advice about how you manage those things?

Kirby: Don’t waste time. I am hyper I have all kinds of quirks that turn out to be just because I don’t want to I just naturally don’t want to waste time. I’m not on social media. What a colossal waste of time on social media. I don’t do that. I don’t watch TV. I read three hours a day on average. I do do a lot of reading, but stop wasting time. Most people waste a lot of time.

Copy LinkHow Scott Kirby leverages reading

Safian: And reading for you is not a waste of time, it’s fuel.

Kirby: I’m curious, so I want to understand the world. I read so much and I read such a wide variety of things that I can connect dots, and things that seem obvious to me, other people don’t see. COVID was one of them. The day that COVID showed up in northern Italy and killed several people, I called our team and said, “This is a global pandemic. I can’t imagine why everyone else hasn’t figured it out, but they have not figured it out yet.” We went off that week and we raised $2 billion of unsecured financing at a 3% interest rate two days before the NBA walked off the court. Two days later it would’ve been impossible at any price. And we just got ahead of it. And reading, I think, helps you connect dots that other people can’t connect.

Safian: What do you read? Do you read books? Do you read newspapers?

Kirby: I read the Wall Street Journal cover to cover every day, and I have since I was in college. That’s like a little over an hour of reading. I read the New York Times, probably five to seven articles in the Times every day. I have four magazines or five, I guess, actually that I’ve had long time subscriptions to that are monthly magazines. I still get those in print and read them. And then I probably read one and a half books a week, so I read fiction and nonfiction. But 1% of my news reading is coming from online, 99% of it’s coming from the newspaper.

Safian: And you’re not turning to AI to summarize your news for you?

Kirby: No.

Safian: To pull out the things that surprised me today?

Kirby: No, because you miss the subtlety. What you get from reading is not the headline part of it. It’s the more subtle connections, the little things that are embedded within it that you didn’t know or think about. And you won’t get those with AI, I don’t think. You’ll get a good summary, but that’s not what I’m looking for. I’m looking for insight. I’m looking for aha “Wow, I never thought of that.” I’m looking for that, and I don’t think you’re going to get that from an AI summary.

Safian: Well, Scott, this has been great. Thank you so much for doing it.

Kirby: Thank you. I’ve enjoyed it.

Safian: Scott’s leadership lessons might sound almost old school, get sleep, don’t waste time, don’t make excuses, but what he’s really talking about is discipline, for us each personally and in how our businesses operate. You can’t run an airline without a discipline system, including discipline safety protocols. What Scott’s balancing right now, like so many leaders today, is how to maintain a culture of discipline while also encouraging new ideas, the ability to change the unchangeable, as he puts it. I take heart that his key personal tool in that effort is reading; newspapers, magazines, information that he wouldn’t encounter by scanning headlines or social media posts.

We hope this podcast serves a similar purpose for you, helping to open your eyes to the many things floating around us, as well as to what’s emerging on the horizon. I’m Bob Safian. Thanks for listening.