Two days after an Asian passenger was forcibly dragged off a United Airlines plane at Chicago's O'Hare International Airport and video of the incident spread globally across social media, travel industry and marketing analysts said that United's reputation has been damaged and the incident could have an impact on the carrier in China.
Chinese netizens expressed furor over the incident that occurred on Sunday evening. By Tuesday afternoon the hashtag "United forcibly removes passenger from plane" was the most popular topic on Weibo, China's equivalent of Twitter. It received more than 480 million views and more than 200,000 comments.
Some Chinese social media users accused United of racism and others called for a boycott of the carrier. United began nonstop service to China in 1986 and operates more nonstop US-China flights, and to more cities in China, than any other airline.
Zishi Zhang, an 18-year-old college student in the UK, launched a petition that calls for a federal investigation of United Airlines' actions. It had more than 55,000 signatures of its 100,000 goal. The petition, which claims that United's actions were racial motivated, is trending on social media with the hashtag #ChineseLivesMatter.
Members of Congress also reacted to the incident, including a call for a hearing on the incident.
United Continental Holdings' stock felt the impact of the incident on Tuesday – it dropped 1.13 percent, wiping approximately $250 million off its market capitalization. The stock had dropped as much as 6 percent prior to the market's open.
The passenger removed from the flight to Louisville, Kentucky, was identified as Dr David Dao, 69. Dao was overheard by another passenger saying that he was picked on because he is Chinese. The Louisville Courier-Journal reported that Dao went to medical school in Vietnam before moving to the US. He lives in Elizabethtown, about 40 miles south of Louisville, where his wife, Dr Teresa Dao, has a medical practice.
Matt Rizzetta, CEO at brand agency North 6 Agency, said that Chinese consumers are highly discerning customers and exhibit deeper brand loyalty to US brands, but are also harder to bring on board as customers.
"If you're United and you've built all this goodwill and spent all this time and made all these investments to get Chinese customers on your side, good job, pat on the back. But data shows that especially in the travel space, once you break that trust it's very difficult to regain," he said.
Jim Corridore, airline equity analyst at CFRA Research, said that prior to United's latest statement on Tuesday afternoon in which CEO Oscar Munoz apologized and said that "no one should ever be mistreated this way", that he was not expecting a major financial impact on the company right now, due to generally strong demand and high capacity in the market. But he said "we are not happy with the way the company is handling the situation, and we know particularly in China, where the company is trying to make inroads, it could have an impact."
Chris Allieri, founder and principal at public relations consultancy Mulberry & Astor, said,
"You can't just look at impact through dollars and cents — these companies are trying to be corporate citizens. They're trying to do good work in other areas, and when something like this happens, your profits and your bottom-line aside, you're still hurting."
He said, "Whether it's dollars lost now or dollars lost later, it will catch up. That's why I say that you need to take responsibility and solve the problem and move forward."
