May 5, 2004

Hi, it's Glenn. I am calling from headquarters in Chicago. Today I've asked Jane Allen, our senior vice president of Onboard Service, to join me to talk about the people of Onboard, from our flight attendants and our pursers to catering and the crew desk, and all that they're doing to improve our customers' experience while they’re being mindful of our need to continually reduce costs.

This is really a very timely topic. The customers that I have the opportunity to meet with when I travel or in customer meetings across the network are telling me and telling all of my colleagues that they see a terrific difference in the quality of service that we're providing across the board. They're reporting to me that our employees are engaged, and they’re very appreciative of our employees’ attention to their needs.

I think this is reflective of good work and employee focus. Our customers increasingly use self-service technology such as the Internet and EasyCheck-in, and there's a premium on every aspect of the inflight experience. Touches such as pilots greeting customers, better food options, and a flight attendant drawing a shade to help a customer sleep have become increasingly more important.

The challenge that Onboard and our entire company faces is not only to ensure our customers' entire flying experience is consistently better than our competition, but also to begin to anticipate what customers might want tomorrow and in the years ahead.

Jane and her organization are very focused on achieving these goals. And I’d like to turn the call over to Jane.

Thanks, Glenn. I hear the same kind of feedback from customers. Onboard, together with our colleagues across the system, has stepped up to help us exceed our first-quarter Success Sharing goals.

Though the inflight experience is driven by many organizations throughout United, I think it's fair to say that no group of employees has more sustained contact with our customers than our flight attendants.

As Glenn said, our job is to ensure that we provide our customers with consistently excellent, safe, reliable and attentive service in a cost-effective way – because our customers have lots of choices today.

Onboard is doing that in three ways:

First, we’re implementing a program with our flight attendants to ensure they deliver customers a consistent experience on all of our flights;

Secondly we’re reducing costs and improving efficiency while still delivering excellent customer service; and

Third, we're reinvesting a portion of those cost savings into the products and services that our customers tell us they want and that differentiate United.
Let me touch on each one of these areas briefly.

First, customers tell us that they want to know what to expect while on any United flight. We’ve launched a program on service consistency that includes a series of weekly Onboard Updates, purser meetings and daily briefings to ensure that onboard procedures and announcements are the same on every flight. We'll also be providing computer-based training for our flight attendants.

The good news is that in each area that we’ve asked our flight attendants to focus on, our Marketrak ratings have improved in the first quarter.

Second, we've achieved real savings through steps such as renegotiating catering contracts; ensuring that we cancel in advance hotel rooms that we do not need, even in irregular operations; and minimizing understaffing and overstaffing on our flights. We've also implemented strategies that make schedules more efficient and reduce our costs.

Third, we're taking these savings and investing part of them into our offerings to customers, especially in First and Business Classes. We can’t be all things to all people, but we can invest in what our customers say they value the most.

For example, we’ve already improved several food and beverage offerings in our North America and International premium cabins, and we will further enhance our International premium cabin offerings this month.

We're working to expand our Buy On Board program, which has proven popular with mainline and Ted customers, and which reduces costs and, in the future, will generate revenue for United.

In fact, Marketrak ratings for customer satisfaction with meals in North America shot up six points between February and March, a sign that our customers appreciate what we’ve done and that we can better compete against other carriers.

Even with these service improvements, United’s overall catering budget is significantly less than it was in 2001. Equally important, our flight attendants are offering a product that enables us to be competitive again.

Of course, a positive inflight experience also depends on all divisions working together.

So, we’ve designated flight attendant advocates, who collaborate with United Services to prioritize and accelerate important cabin repairs, and with Airport Operations on cabin and lavatory cleanliness.

Similarly, members of our Onboard team, including flight attendants, were part of the cross-divisional team that created and launched Ted, and that ensures that we deliver a uniquely Ted experience to customers.

Importantly, just as the company has done with Success Sharing, we in Onboard have set clear goals and service standards against which we measure our performance.

Everyone, from my senior staff and I to managers, supervisors, pursers and flight attendants, has unambiguous goals, responsibilities and accountability. We are working hard to make sure everyone has a clear line of sight as to what we need to do to be successful.

Onboard's mission is to consistently provide safe, reliable and attentive service to our customers and colleagues. I appreciate the opportunity to talk about how we're working to fulfill our mission. Glenn?

Thanks, Jane. I want to go back to a point that Jane made about teamwork. Our company is working together as a team as perhaps we never have before. And I think that’s because, in part, each of us has gained a clear understanding of what we each need to do to make this a successful ongoing, competitive United.

We’re delivering tangible benefits to the company through teamwork and, importantly, tangible benefits to our customers. We all need to keep it up and we need to continue to improve as we go forward.

Thanks to Jane for being on the call with me today, and thanks to all of you for being on the call with Jane and me. I'll be talking with you again soon.