United Airlines (NYSE:UAL) took the biggest blow to its stock price not from removing a paid passenger off a flight to open seats for company employees but after its CEO defended a policy that allowed the customer to be bloodied and pulled off the plane against his will.
The public generally is forgiving if honest mistakes occur, apologies are given and corrective action is implemented to avoid a recurrence. But United Airlines and its leader initially followed none of those steps and the result is that the company lost roughly $950 million in market value in the wake of its self-inflicted public relations crisis.
The chart below shows the stock price‚??s drop on April 11.
The solution for the airline rests partly within its so-called ‚??Customer Commitment‚?Ě policy on its own corporate website, which promises to provide a level of service to customers that is commensurate with ‚??a leader‚?Ě in the airline industry.
‚??Our goal is to make every flight a positive experience for our customers,‚?Ě the policy states.
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Paul Dykewicz is the editorial director of Eagle Financial Publications, editor of StockInvestor.com and DividendInvestor, a columnist for Townhall and Townhall Finance, a commentator and the author of an inspirational book, ‚??Holy Smokes! Golden Guidance from Notre Dame‚??s Championship Chaplain,‚?Ě with a Foreword by legendary football coach Lou Holtz. Visit Paul‚??s website at www.holysmokesbook.com and follow him on Twitter @PaulDykewicz.
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