When United Airlines went Chapter 11 last December, the most prudent action might have been to liquidate-and let efficient upstarts take the gates, repaint the planes and hire motivated new employees at realistic wages. But United instead is trying to reorganize, and part of the plan is to start a separate airline-within-an-airline. Delta Air Lines is betting a growing share of its marketing budget on Song, which competes with JetBlue. Up north, bankrupt Air Canada is expanding the no-frills Tango by Air Canada sub-brand.
It's confusing, inefficient and unnecessary for a major carrier to create a parallel network. Rather than spending fortunes to build new brands, airlines should stick with existing names and rethink the product. This isn't to say most major airline brands are worth much. United in recent years came to connote mediocre service and overpaid, disgruntled employees; its legacy as an aviation pioneer means little. Once-proud names like Pan Am and Trans World Airlines already have disappeared without a trace.
But the cost of starving an old airline name for a new brand is too high. Old brands do have some value: People know United flies everywhere, runs a big frequent-flier program and has a good safety record, even if its image today pales next to that of Southwest Airlines or JetBlue. Can old carriers compete? They have a chance-if they simplify pricing, focus on basics and exhibit leadership at the top to motivate employees while slashing costs. Not easy. But the problem isn't the brand name. Rethink the product, and travelers will take a flier-and come back if the airline delivers.