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The airline of the future: Could it be Continental?

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Times Staff Writer

CONTINENTAL is the Clark Kent of airlines.

Like Superman’s alter-ego, it’s mild-mannered, even dull. It looks like the other button-down guys.

Yet it pops up seemingly everywhere. And when awards are issued, it darts into a phone booth, dons a cape and zooms into the clouds.

Continental runs the best business class of any U.S. airline on foreign routes and the best premium service on domestic routes, according to a readers survey of more than 1,800 business travelers in this month’s Conde Nast Traveler magazine.

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Earlier this year, Continental nosed out Delta for best network carrier in an annual poll of 9,334 North American fliers by J.D. Power & Associates, a marketing company in Westlake Village.

On the other hand, it ranked only eighth out of 17 U.S. carriers in this year’s Airline Quality Rating, a study by researchers at Wichita State University in Kansas and the University of Nebraska that relies mostly on federal statistics on customer complaints, on-time flights and other factors.

Why should you care?

Because the low-key, Houston-based company may one day shape the way most people fly: pampered in business and first class, with a few key perks in economy. And lots of routes to chose from.

“The real future is with carriers like Continental,” said aviation analyst Mike Boyd, who views it as the best of the comprehensive network airlines, which include American, Delta, Northwest and United.

With tentacles that stretch from booming mid-sized U.S. cities to Beijing, these behemoths and their regional partners go where the growth is. That’s not on coast-to-coast routes, where low-cost carriers pile on planes and drive down fares, said Boyd, president of the Boyd Group in Evergreen, Colo.

Continental can trace its current success to 1994, when Gordon Bethune rode to the rescue of a company that had stumbled into Chapter 11 bankruptcy twice in one decade.

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“Gordon Bethune left a heck of a legacy,” Boyd said. “And the current management picked up the ball and ran with it.”

In recent years, Continental has avoided bankruptcy and labor strife, the twin plagues of its peers. Like most of them, it’s making money again.

Explaining the airline’s high rank in surveys, Linda Hirneise, executive director of the travel practice at J.D. Power & Associates, said, “It’s not one thing done right. It’s many things done right consistently.”

Some of those things:

Continental flies nearly everywhere: It’s only the fourth largest U.S. airline, and its hubs, well east of the Rockies, aren’t glamorous: Houston, Cleveland and Newark, N.J. By passengers flown, it recently ranked seventh at LAX. (United was No. 1.)

But Continental flies to more international destinations than any other U.S. airline, 138 in all, with routes to Asia, Europe, Latin America and elsewhere.

Its customers have access to hundreds more flights through the SkyTeam global airline alliance, which Tim Winship, editor and publisher of the online newsletter FrequentFlier.com, judges “the most robust of the alliances” in U.S.-based carriers, which also include Delta and Northwest.

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It takes care of business: “We’re very much an airline that’s geared toward the business traveler,” said Jim Compton, executive vice president of marketing.

These are, after all, the customers who pay the highest fares and fly most frequently.

Continental’s international business seats on Boeing 777s, which recline nearly flat, are the best of any U.S. carrier, said Matthew Bennett, editor of First ClassFlyer.com, an online guide to first-class and business travel.

Opinion is divided on the OnePass frequent-flier program, which on paper looks unremarkable, except that you can reach top platinum status with 75,000 miles, compared with 100,000 miles on some competitors. In recent interviews at LAX, Continental customers said OnePass was “decent” and “comparable” to other mileage programs.

But it’s how OnePass is implemented that pleases some.

Along with business- and first-class customers and those paying full fare in economy, elite-level fliers get their own roped-off area at the gate and can board whenever they like. Their bags are tagged for first unloading.

Continental also seems fairly generous with free upgrades, Winship and Bennett said.

Providing charity in the cheap seats: Although Continental focuses on the finicky business traveler, “we are happy to take leisure customers along with us,” Mark Bergsrud, senior vice president for marketing programs and distribution, told investors last month.

In a triumph of the trickle-down theory, coach fliers, even on domestic routes, still get free blankets, pillows and hot meals. On a recent Continental flight, my meal consisted of a mini-pizza in foil, but that’s more than you get from many competitors.

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“People value those little things that put them in a good frame of mind when they get off the plane,” Compton said.

How does he know this? Because, he said, Continental constantly surveys customers and employees.

But Continental’s largesse has its limits.

Coach fliers I recently interviewed complained of tight legroom. Seat pitch, a measure of legroom, is 31 inches in Continental’s coach cabin, compared with 32 and up on JetBlue, a key rival in Newark.

Saying Continental’s seat pitch was “competitive in the industry,” Compton said more legroom would mean fewer seats and lower profits.

You won’t get seat-back TVs either.

“Our customers tell us, ‘We don’t want to be entertained. We want to be productive,’ ” said Compton, who added that such gadgets cost too much and weigh down the plane, hurting fuel economy.

The airline values employees: “The people are the key to our success,” Larry Kellner, Continental’s chairman and chief executive, told investors last month in a speech peppered with glowing references to “my co-workers.”

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After the Sept. 11, 2001, attacks hurt air travel, Continental’s executives gave up their pay for the rest of the year. They later squeezed more than $1 billion out of operations before turning to employees for $500 million in cuts when fuel costs soared.

“That shows a different kind of approach,” analyst Boyd said, compared with competitors.

It has paid off, experts said, in peaceful labor relations, higher morale and perhaps better service. The friendliness and courteousness of flight crews, Hirneise said, helped inch Continental to the top of the J.D. Power survey.

Overall, Winship said, Continental does things “a little bit better than the next guy.”

Maybe not enough to notice, you might say.

Except when awards come around.

*

jane.engle@latimes.com

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