This case dates back to 1996 and 1997 but a recent article by Time magazine and Southwest buying AirTran makes it relevant again. Time had piece about the top 10 worst corporate name changes. At number nine was ValuJet. ValuJet has not been around as a corporate name since 1997. But the story of the name change is fascinating and actually worked for ValuJet. So let us revisit the story.
ValuJet was one of the first small, low-cost airline carries to emerge in the U.S. and was based in Atlanta. On May 11, 1996, ValueJet Flight 592 from Miami to Atlanta crashed into the Everglades. The DC9 disappeared from the radar and into the wilds of the Everglades resulting in the loss of 110 people. There is a memorial for the 110 victims in the Everglades consisting of 110 concrete pillar memorial is located just north of Tamiami Trail about 11 miles west of Krome Avenue in Dade County, Florida and points to the location of the actual crash site eight miles to the north.
The cause of the accident was improperly stored oxygen generators in the cargo hold. Oxygen generators supply the oxygen to air masks the deploy when there is a sudden change in cabin pressure on an airplane. Some had been removed from two airplanes and a few of those found their way to the hold of Flight 592. The canisters were not secure and activated. When oxygen is produced through a chemical reaction, heat is generated. The heat caused nearby tires to burn and eventually the fire destroyed the electrical system and dropped the plane from the sky. The National Safety Transportation Board (NTSB) ruled the following:
the fault for ValuJet Flight 592 on three parties: SabreTech, for illegally transporting dangerous materials aboard a commercial aircraft, improperly labeling them, and not providing safety equipment to ship them; ValuJet, for not properly supervising SabreTech; and the FAA, for not properly supervising ValuJet and not requiring active fire suppression equipment in this cargo compartment.
ValuJet made a number of statements including the following:
n ValuJet made mistakes, the company’s president admitted in aviation safety hearings before a House transportation subcommittee Tuesday. ValuJet President Lewis Jordan even conceded that not all of the airline’s violations were simply “paperwork violations.”
- “We’ve had a number of paperwork violations, I have said repeatedly,” he said, “but I’ve acknowledged genuine deficiencies that we plan to both fix and put preventive actions in place.”
- But he said ValuJet was being unfairly scrutinized because of its size and its youth. He said that if the larger airlines were similarly investigated, similar problems would probably be found.
- In his testimony, Jordan pinned the blame for the crash onto SabreTech, implying that oxygen generators in the cargo hold caught on fire and led to the crash. SabreTech was employed by ValuJet to process and pack certain materials, including between 50 and 150 oxygen generators that were erroneously loaded onto the doomed flight.
- Jordan testified that SabreTech employees inspected the canisters, improperly labeled them as empty, and were responsible for not putting safety shipping caps on the canisters.
- ”It is my simple and straightforward contention that had those boxes been so marked, ValuJet would simply not have accepted them. They never would have been on the airplane and those 110 people would not have lost their lives,” he said.
The Federal Aviation Administration (FAA) grounded all ValuJet flights on June 19, 1996. Flights resumed with 15 planes on September 26, 1996. The company struggled with huge financial losses. In 1997, ValuJet merged with the smaller AirTran and rebranded under the name AirTran. AirTran’s web site does not discuss the issues surrounding the crash and rebranding but Wikipeida does. The Time piece noted: “By the end of the next year, though, passengers were again flying ValuJet — even if they didn’t realize it. In a corporate disappearing act, the troubled airline bought a smaller rival and adopted its name, becoming AirTran Airways. Overnight, ValuJet shed its sketchy reputation and vaguely unsettling name.”
Questions to Consider
1. What types of response was ValuJet using in the crisis?
2. How would you rate the effectiveness of the response and why? In your answer consider the key concerns customers would have following the crisis?
3. What ethical issues do you see with ValuJet’s crisis response?
4. What ethical issues arise with the rebranding effort that transformed ValuJet into Airtran?
5. What advice would you have given ValuJet concerning its crisis response and what is the rationale behind that advice?
6. What communication advice would you give Southwest if this story reappears as they merge with AirTran? What is the rationale behind that advice?
7. What are the transparency issues/concerns in this case?