Delta ranks 4th out of seven largest companies in survey
The Atlanta Journal-Constitution
Published on: 05/20/08
A new survey shows customer satisfaction with the airline industry dropping to near historic lows, with Atlanta-based Delta Air Lines ranked fourth out of the seven biggest U.S. airlines.
The survey being released Tuesday by the University of Michigan found customers giving airlines the worst grades since 2001, with the industry's overall scores down for the third straight year.
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Airlines drew the worst scores of 18 industries in the American Customer Satisfaction Index. Cable and satellite TV were next-to-worst despite logging their highest score since the index began. Comcast, Atlanta's biggest cable provider, was tied for last with Charter Communications among cable companies.
A bright spot in the survey was express delivery, which posted the highest satisfaction levels. FedEx edged out Atlanta-based archrival UPS for the top score in that category. Full- and limited-service restaurants also scored well in the survey, which looks at different groups of industries during different quarters of each year.
Among airlines, the four big carriers most likely to combine were all at the bottom of the rankings. Delta was followed by proposed merger partner Northwest in fifth place, while United and US Airways, also in talks to merge, were sixth and seventh, respectively.
Claes Fornell, a University of Michigan business professor and director of the research center that compiled the data, called that a worrisome result.
"When it comes to mergers, combining two negatives doesn't make a positive," he said.
A familiar bright spot in the American Customer Satisfaction Index was Southwest Airlines, which led the industry in passenger satisfaction for the 15th consecutive year.
While unhappiness with airlines is nothing new, this year's survey produced "really dismal numbers," said Fornell, a University of Michigan business professor and director of the research center that compiled the data.
"There's no other industry anywhere that has so many basic mishaps in terms of not delivering the basics," he said. "They're supposed to deliver passengers with their luggage to a particular destination within a certain timeframe, and they frequently fail to do that."
Asked why scores have worsened so significantly, he said airlines' management has to be blamed despite some factors beyond their control such as higher jet-fuel costs and congested airports.
But passengers also are not blameless, according to Fornell.
"They buy primarily on price, and very little else," he said. "The result of that is very low service and a business model of cost-cutting that really leaves no one happy, certainly not the businesses, the shareholders or the flying public."
About 26,000 people responded to the survey during the first quarter of this year. A scale of 1 to 100 was created based on the responses to questions about overall satisfaction, intention to be a repeat customer and perception of quality, value and expectations.
The index for the airline industry as a whole fell to 62 from 63 last year, barely above its historical low of 61 in 2001. Southwest led the way with an index of 79, up from 76 last year.
"We're always excited and thrilled that we can offer some of the best customer service in the industry," Southwest spokeswoman Christi Day said.
After Southwest came a huge drop in customer satisfaction, with scores of 62 at American Airlines and Continental. Atlanta-based Delta scored 60, and Northwest slipped to 57 from 61 in 2007. US Airways' score dropped to 54 from 61 a year ago, taking over the bottom spot from United, whose score held at 56.
US Airways, formed from the 2005 merger of America West and US Airways, acknowledged its need to improve.
"While we still have work to do, we're confident that the investments we're making in reliability, convenience and appearance are making a positive impact," spokesman Morgan Durrant said. He noted that the carrier had the best on-time performance of the 10 largest airlines in first-quarter statistics compiled by the U.S. Department of Transportation.
Cable and satellite TV companies' average rating rose 3.2 percent from a year ago to a score of 64 for 2008. Newspapers were tied with a score of 64 as well, down 3 percent from a year ago.
Topping the cable/satellite industry were smaller operators — in a category called "all others" that included Cablevision Systems and RCN Corp. — with a grade of 69 out of a perfect 100.
Satellite TV providers DirecTV Group and Dish Network came in second and third with scores of 68 and 65, respectively. Though high for its industry, Dish's score was an all-time low for the company.
Comcast rated 54 points out of 100. Rapid growth for the Philadelphia-based company, which has been buying smaller cable systems, may have added to its customer service woes, the report said.
"Comcast has come in and put a lot of money into technology, but not too much into customer service," said Fornell, founder of the index. "The system is still not reliable enough and when customers call for customer assistance, it is not handled the way they would like it to be."
Rick Germano, Comcast's senior vice president of national customer operations, said the cable provider isn't happy about its rating, but "we get it. We're listening."
Comcast has conducted focus groups in 10 cities across the country in the past year, created a group to monitor and respond to bloggers' complaints, improved its internal processes and stepped up training of its customer service employees and technicians.
Comcast has hired 15,000 of these "front-line" workers in the past 18 months, Germano said.
Express delivery earned a score of 82, with FedEx at 85 and UPS at 83.
You can see the results at this Web site.
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