Hard Landing
Page 60
30. “brush their hair”: Aviation Week, Feb. 9, 1976.
31. Lamar Muse: Muse’s background is based on, among other sources, Larry D. Sall, “Marion Lamar Muse,” in Encyclopedia of American Business History and Biography.
32. bothered him: Barron 4/26/93 interview; Kelleher 10/14/93 interview.
33. “chicken coop”: Testimony of Charles Murphy, executive director, Texas Aeronautics Commission, U.S. Senate, Subcommittee on Administrative Practice and Procedure, Oversight of Civil Aeronautics Board Practices and Procedures, Feb. 14, 1975.
34. In addition to matching: Parker and Barrett 4/26/93 interviews; Kelleher 10/14/93 interview; Fallows, Texas Monthly, Dec. 1975.
35. Chivas Regal distributor: Sall, “Marion Lamar Muse.”
36. first employee-owned airline: Kelleher 10/14/93 interview.
37. beauty parlor: The business background of Lorenzo’s family was described by Bakes, Burr, O’Donnell, and other people who worked closely with Lorenzo over the years.
38. walls of his bedroom: “Top Gun,” by William P. Barrett, Texas Monthly, Mar. 1987. Other published accounts of Lorenzo’s early years include “TWA’s Rescuer Is a Street Fighter,” by James R. Norman, BW, July 1, 1985; and “Take-Off for Texas?” Dun’s, Oct. 1972. A number of details of Lorenzo’s life were also obtained from people who were close to him.
39. buying airline shares: Norman, BW, July 1, 1985.
40. Frankie Smooth Talk: Barrett, Texas Monthly, Mar. 1987.
41. gentile fraternities: “Sophomore Elections Conspiracy: Decline and Fall of a Machine,” by Arnold Abrams, Columbia Daily Spectator, May 1, 1959.
42. “discussed … voting twice”: Ibid.
43. biographies of … Carnegie: Barrett, Texas Monthly, Mar. 1987.
44. Lorenzo, Carney: Lorenzo’s early ventures were described by a number of former associates and detailed in a Jet Capital amendment to Form S-2, filed with the SEC on Nov. 19, 1969, and in a Jet Capital prospectus dated Jan. 22, 1970.
45. flew to New Orleans: Burr 9/16/93 interview.
46. approached by Bob Carney: Ibid.
47. fly over Mount Whitney: Ibid.
48. gin-and-cigar junket: Ibid.
49. Shares of Jet Capital: Lorenzo and Carney’s machinations with Jet Capital are described in Jet Capital’s Jan. 22, 1970, prospectus, as well as in a number of earlier and later filings that survive on microfiche at the SEC.
50. flash money: Jet Capital Jan. 22, 1970, prospectus.
51. Then one day: Lorenzo described his thought process in “Take-Off for Texas?” Dun’s, Oct. 1972.
52. Mohawk … was the first: “Mohawk Airlines,” by William M. Leary, in Encyclopedia of American Business History and Biography.
53. Lorenzo met with … Peach: The account of Lorenzo’s dealings with Mohawk and the sale to Allegheny is based on the Murray 9/4/93 interview and on interviews with other participants and eyewitnesses.
54. killed himself: Leary, “Robert E. Peach,” Encyclopedia of American Business History and Biography. The fact of Lorenzo’s lunch date was confirmed by two close friends of Lorenzo.
55. Vietnam troop buildup: Higgins 6/8/94 interview. Higgins piloted Trans-Texas DC-3S in the troop movements.
56. Burr had an idea: Burr 9/16/93 interview.
57. prescription … urged: The account of Texas International’s restructuring, including Jet Capital’s ownership arrangements and the contest with Hughes, were described by a number of participants and observers and detailed in a collection of decisions and exhibits filed as a CAB proceeding, Control of Texas International Airlines, 60 C.A.B. 20, decided Aug. 9, 1972. Additional details were obtained from Jet Capital’s 10-K report for 1971.
58. The board … looked warily: CAB, Control of Texas International.
59. Kelleher showed up: Kelleher 6/14/94 interview.
60. hog-tied … with conflicts of interest: CAB, Control of Texas International.
61. a proud moment: Lorenzo’s pride in his defeat of Howard Hughes was described by an eyewitness.
62. youngest president: Dun’s, Oct. 1972.
63. Burr had passion: Burr’s background and character are based principally on interviews with him and with many people who worked with him, including Bakes, Murray, Gitner, Dawsey, O’Donnell, Plaskett, Sullivan, and Lavender. Burr made a number of revealing comments about himself in speeches and interviews with others, including on a privately produced videotape, The People Remembered, by JR Productions; “Bitter Victories,” an interview with Burr by George Gendron, Inc., Aug. 1985; and “A Conversation with Don Burr,” Scorecard: The Revenue Management Quarterly, Fourth Quarter 1992. Burr has additionally been the subject of many in-depth profiles, the best of which include “Rapid Ascent: People Express Flies into Airlines’ Big Time in Just Three Years Aloft,” by William M. Carley, WSJ, Mar. 30, 1984; “That Daring Young Man and His Flying Machines,” by Lucien Rhodes, Inc., Jan. 1984; and “A Yankee Preacher in the Pilot’s Seat,” by Stephen Koepp and Frederick Ungeheuer, Time, Jan. 13, 1986.
64. ferocious statewide election: Burr 9/16/93 interview.
65. became a father: Ibid.
66. dirty and bad: Burr 9/17/93 interview.
67. his arms flailed: Burr 9/16/93 interview.
68. One weekend: Ibid.
69. windowless building: Life in the Blue Barn was described by many of the people who worked there.
70. full partnership: Burr 9/16/94 interview.
71. visit to Alvin Feldman: Ibid.
72. yesterday’s news: Based on an interview with someone familiar with the relationship.
73. Frank was the godfather: Burr 9/16/93 interview.
74. “feel despicable”: Ibid.
75. “Frank, great news”: Ibid.
76. $10 million in mutual aid: Footnote 7, Texas International Airlines 1975 Annual Report.
77. “needed the strike”: Burr 9/16/93 interview.
78. South Padre Island: Sall, “Marion Lamar Muse.”
79. sparing nothing in the effort: Coats 6/9/94 interview; O’Donnell 6/9/94 interview; Fallows, Texas Monthly, Dec. 1975.
80. didn’t … carry U.S. mail: Kelleher 10/14/93 interview.
81. dozens of Harlingen residents: Barron 4/26/93 interview.
82. funeral director: Coats 6/9/94 interview.
83. passengers from Mexico: “Business Soars Where Airline Flies,” by Del Jones, USA Today, Sept. 17, 1993.
84. Southwest University: Coats 6/9/94 interview.
85. Gatling Gun Gitner: J. Arpey 9/8/93 interview.
86. started his career: O’Donnell 6/9/94 interview.
87. eager for the acceptance: Many accounts have suggested that Lorenzo had an impulse to slash fares from the time he came into the airline industry. By contrast most informed sources say that Lorenzo, desirous of the approval of his peers, was a reluctant price cutter, particularly in his early years of controlling Texas International and, later, Continental. In several years Lorenzo’s annual letter to the stockholders of Texas International emphasized the virtues of fare increases.
88. special on permanents: O’Donnell 6/9/94 interview.
89. Flying back to Houston: Ibid.
90. as much as 600 percent: “Texas International Air Plans Discount Fares on Seven Routes in March,” WSJ, Feb. 11, 1977.
91. Surveys showed: “Super Saver Swells Discounts,” by David M. North, Aviation Week, Feb. 20, 1978.
92. “chickenshit fares”: Apr. 26, 1978, internal report by Donald Burr and Edwin Cathell, Texas International Airlines.
93. not … an argument: “Texas International Asks 50% Fare Cut on Selected Flights,” WSJ, Dec. 16, 1976.
Chapter 3: Network Warriors
1. “Be ruthless”: R. L. Crandall, address to marketing meeting, Aug. 2, 1988.
2. “crunch our competitors”: Remarks by R. L. Crandall to Sabre Travel Information Network, Apr. 23, 1988.
3. he inspired fear: Crandall 4/23/93 interview.
/> 4. black wings: Crandall speech to marketing meeting, Inn of Six Flags, Dallas, Feb. 25, 1981.
5. Crandall loved bridge: Plaskett 8/31/93 interview.
6. misuse, and grammatical lapses: Becker 9/3/93 interview.
7. tools hung precisely: Crandall 4/23/93 interview.
8. “drives her batshit”: Ibid.
9. “When I was born”: Crandall 9/1/93 interview.
10. Robert Lloyd Crandall: Crandall provided most of the details of his life and career in interviews. Additional facts were compiled from a number of other significant in-depth treatments, including D. Reed, American Eagle; “Frequent Flier,” by Paulette Thomas, Avenue, Summer 1988; “Battle of Titans,” by Bridget O’Brian and Judith Valente, WSJ, Oct. 10, 1989; “Bob Crandall Soars by Flying Solo,” by Kenneth Labich, Fortune, Sept. 29, 1986; and “American Rediscovers Itself,” BW, Aug. 23, 1982.
11. His father was rescued: Crandall 4/23/93 interview.
12. a fat boy: Crandall 6/13/94 interview.
13. A decent fistfight: Crandall 4/23/93 interview; Thomas, Avenue, Summer 1988.
14. how fast he could ring: These and other details of Crandall’s early working life were described in the Crandall 9/1/93 and 6/13/94 interviews.
15. “noted for arguments”: Barrington High School Arrow for 1953.
16. “They sold the shit”: Crandall 9/1/93 interview.
17. C. R. Smith had agonized: The story of Sabre’s birth was detailed in the Hopper 4/22/93 and 10/13/93 interviews and, among other published sources, in Serling, Eagle; Bashe, IBM’s Early Computers; “Airline Automation: A Major Step,” by C. E. Ammann, Computers and Automation, Aug. 1957; “American Airlines Automates Reservations for the Jet Age,” by Arnold E. Keller, Management and Business Automation, Jan. 1959; and “The Sabre System,” by R. W. Parker, Datamation, Sept. 1965. A number of unpublished monographs, bulletins, and other internal records of American Airlines and IBM were also used, including “American Airlines’ ‘Sabre’ Electronic Reservations System,” by W. R. Plugge and M. N. Perry, circa 1962, and “American Airlines, Inc., and The Teleregister Corp. Present the Magnetronic Reservisor,” circa 1952.
18. “reservations theory”: Wolfe, Air Transportation Traffic and Management, page 495.
19. 20 separate communications: Ibid., page 503.
20. a grand contraption: D. G. Copeland, R. O. Mason, and J. L. McKenney, “SABRE: The Development of Information-Based Competence and Execution of Information-Based Competition,” IEEE Annals of the History of Computing, 1995; Ammann, Computers and Automation, August 1957.
21. nicknamed Girlie: Ibid.
22. “unfavorable proportions”: Plugge and Perry, “American Airlines’ ‘Sabre’ Electronic Reservations System.”
23. Blair Smith: Copeland, IEEE Annals of the History of Computing, 1995; Bashe, IBM’s Early Computers, page 517.
24. 14,000 … computers of any kind: “On Line in Real Time,” by Gilbert Burck, Fortune, Apr. 1964.
25. “space age brain”: “SABRE: A Plane Seat—Presto!” by Ted Ward, New York Post, Sept. 15, 1964.
26. “new mechanical monsters”: Copeland, IEEE Annals of the History of Computing, 1995.
27. Passed over: D. Reed, American Eagle, page 16.
28. lost its way: Crandall 9/1/93 interview.
29. succeed … Marvin Traub: D. Reed, American Eagle, page 43.
30. exquisitely boring: Crandall 9/1/93 interview.
31. “fast-paced, high-risk”: quoted in “Competitive Anger,” by Suzanne Loeffelholz, Financial World, Jan. 10, 1989.
32. succeeded by … Spater: Spater is profiled in Serling; Eagle; and in “Goodbye to Robin Hood?” Forbes, Feb. 15, 1968.
33. the most erudite: Wheatcroft 2/24/94 interview.
34. dinner invitation: The account of American’s Watergate finance involvement is based largely on “Memorandum of American Airlines Regarding Campaign Contributions During 1971-72,” Aug. 20, 1973, and “Prosecutive Memorandum Re American Airlines,” to Archibald Cox from Thomas F. McBride and John G. Koeltl, Watergate Special Prosecution Force, Oct. 9, 1973. These documents and others were obtained from the National Archives under the Freedom of Information Act.
35. terra incognita: Quoted in Lucas, Nightmare, page 174.
36. nudge from C. R. Smith: Smith’s involvement is detailed in “Memorandum of American Airlines,” Aug. 20, 1974. The report of the Senate Select Committee on Presidential Campaign Activities, page 448, says that Spater obtained the $5,000 checks “from a friend.”
37. “five in cash”: Quoted in “Memorandum of American Airlines,” Aug. 20, 1973.
38. spared from criminal charges: “Three Firms’ Plead Guilty on Campaign Gifts,” by Paul E. Steiger, Los Angeles Times, Oct. 18, 1973.
39. “brightest young financial men”: Quoted in Serling, Eagle, page 439.
40. Casey’s … apartment: Crandall 9/1/93 interview; D. Reed, American Eagle, page 106.
41. Casey was looking: Lloyd-Jones 3/10/94 interview; Serling, Eagle, page 443.
42. a planning exercise: “Industry Appraises American’s Marketing,” by William H. Gregory, Aviation Week, Sept. 2, 1974.
43. purposefully contentious: Crandall 9/1/93 interview.
44. terminated within days: Baker 6/10/94 interview.
45. tightest possible connections: Crandall, text of presentation to the American Airlines board of directors, June 18, 1975; Presentation to 1976 Management Meeting, undated text.
46. 1,000 cathode ray tubes: Hopper 10/13/93 interview.
47. top data processing executive: Ibid.
48. William A. Patterson: “There’s More Than One Way to Run an Airline,” by Perrin Stryker, Fortune, Feb. 1961.
49. remote and confrontational: Luce 8/26/93 interview.
50. Keck’s standing sank: Luce’s downfall and Carlson’s hiring are described in Johnson, Airway One; Carlson, Recollections of a Lucky Fellow; “Sic Transit Gloria: George E. Keck Found United Air Lines’ Skies Could Turn Unfriendly,” by Todd E. Fandell, WSJ, Sept. 11, 1972; “How a Hotelman Got the Red Out of United Air Lines,” by Rush Loving, Jr., Fortune, Mar. 1972; and “Losses Spark Shakeup at United,” by Laurence Doty, Aviation Week, Jan. 4, 1971.
51. going down the drain: Luce 8/26/93 interview.
52. hidden agenda: Ibid.
53. one of Gleed’s close friends: Carlson, Recollections, page 249.
54. Carlson was fresh blood: Carlson’s background and turnaround moves were detailed in interviews with Ferris and others who knew him; Johnson, Airway One; “A Life of Hard Work and a Stroke of Luck Aided Edward Carlson,” by Todd E. Fandell, WSJ, Oct. 18, 1971; and Loving, Fortune, Mar. 1972.
55. self-described hero-worshiper: Carlson, Recollections, page 215.
56. “Ready Eddies”: McAnulty 2/25/94 interview.
57. 186,366 miles: Loving, Fortune, March 1972.
58. born with verve: The account of Ferris’s background is based primarily on interviews with him and people who knew him well. Additional details were obtained from “Winning His Wings: United Airlines’ Ferris Sets Expansion Plans, Alarms Carrier’s Rivals,” WSJ, Mar. 2, 1979; “Foodservice Career Profiles: Richard J. Ferris,” by James R. Myers, Cooking for Profit, Aug. 1967; “Friendlier Skies? United Airlines Hopes Pilots’ Vote This Week Will Be Turning Point,” by John Curley, WSJ, Aug. 10, 1981; and “Friendly Skies over Pacific: How United Did It,” by Carol Jouzaitis, Chicago Tribune, Apr. 7, 1986.
59. his father had scraped: Letter, Jesse W. Ferris to Dick Ferris, Aug. 28, 1957.
60. Ferris … landed: Ferris 6/7/94 interview.
61. Rocker Four Club: Ferris 5/27/93 interview.
62. legendary Dan London: Ferris 5/28/93 interview; Carlson, Recollections, pages 226, 234.
63. “work at the Olympic”: Ferris 5/28/93 interview.
64. brash letter: Richard J. Ferris to Edward E. Carlson, Feb. 26, 1962.
65. “show business”: Ferris 5/28/93 interview.
> 66. “full of myself”: Ferris 5/27/93 interview.
67. a fabled enterprise: Nielsen, From Sky Girl to Flight Attendant, page 17; Solberg, Conquest of the Skies, pages 219-20.
68. membership in the Fortune 500: The food operation would have ranked roughly 400 on the list, comparable to such household name companies as Mattel, Green Giant, and Max Factor.
69. jabbing his finger: Putnam 10/13/93 interview.
70. reducing … steak: WSJ, March 2, 1979.
71. shared his thinking: Carlson, Recollections, pages 236-38.
72. spent weeks agonizing: Ibid., page 237.
73. “reservations about Ferris”: Ibid., page 238.
74. “ ‘boy wonder’ success”: “New UAL Chief Must Earn Wings,” by Leonard Wiener, Chicago Tribune, May 2, 1979.
75. Crandall was jarred: Hopper 10/13/93 interview; Copeland, IEEE Annals in the History of Computing, 1995.
76. Ferris … looked warily: Ferris 5/27/93 and 5/28/93 interviews.
77. months studying the issues: Ferris 5/27/93 interview; Zeeman 7/23/93 interview.
78. ordered his field managers: Crandall, speech to management meeting, DFW, 1976.
79. United was warning agents: Hopper 4/22/93 interview.
80. “Where do we go”: Crandall, speech to management meeting, DFW, 1976.
81. “short white socks”: Gunn 9/1/93 interview.
82. $800,000 worth: “Automation: The First 25 Years,” ASTA Agency Management, Nov. 1989.
83. Crandall blew his stack: The harried takeover was described in the Murray 9/4/93 interview, the Hopper 10/13/93 interview, and in a speech by Crandall to First Boston Clients, Mar. 11, 1986.
84. enticing agents: The birth of “override” commissions in the CRS wars was described in interviews with Lazarus, Zeeman, and Gunn, and in a variety of industry and government publications about the growth of the CRS industry.
85. “highly confidential”: Gunn, speech to 1984 American Airlines marketing meeting.
86. United had no idea: This point is conceded by Ferris and Zeeman.
87. a questionable business practice: Zeeman 7/23/93 interview.