Case Detail

Case Summary

Launching the Shuttle by United

Case Number: 5-104-023, Year Published: 2004

HBS Number: KEL041

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Authors: James Dana

Key Concepts

Competitive Strategy, Cost Management, Employee Buyout, Labor Relations, Industry Analysis, Cost and Benefit Drivers

Abstract

This case outlines United’s plan to launch a low-cost “airline-within-an-airline” to compete head-to-head with Southwest Airlines in the West Coast corridor. Details regarding United’s employee buyout and labor’s cooperation with the Shuttle’s launch are included. The student is challenged to understand the potential positioning and efficiency advantages of the “airline-within-an-airline” model, and the logic, or lack thereof, of head-to-head competition.

Number of Pages: 25

Extended Case Information

Teaching Areas: Economics, Strategy

Geographic: West Coast / US

Industry: Airline

Organization Name: United Airlines

Organization Department: Corporate Strategy

Organization Size: Large

Decision Maker Position: CEO

Decision Maker Gender: Male

Year of Case: 1994