It looks like Southwest Airlines may have fallen into a growth trap: "Among all other influences, the desire to grow has perhaps the most perverse effect on strategy" - M.E. Porter<p>Southwest competes on cost, and this cost position hinges in large part on the rapid turnaround of aircraft. Rapid turnaround lowers Southwest's equipment and labor costs; its aircraft, pilots, and flight attendants are "doing work" for longer periods of time each day (rather than sitting idle on the ground).<p>A variety of activities contribute to Southwest's ability to rapidly turnaround aircraft, but some of the key activities include:<p>- Southwest's culture, where everyone pitches in to turnaround aircraft<p>- Using a single type of aircraft (737s), enabling simplified service and maintenance<p>- The point to point route structure, avoiding the issue of synching the schedules of hub and spoke aircraft<p>- Operating at less congested airports to avoid traffic delays<p>From my vantage point, it seems the AirTran acquisition threatens each of these activities:<p>- Integrating AirTran's distinct culture with Southwest's<p>- Expanding beyond 737s to operate 717s<p>- Divergence from the point to point structure to a hub and spoke<p>- Entry into congested airports, such as Hartsfield-Jackson (ATL), which was ranked #20 in 2010 for on-time departure performance by the Bureau of Transportation Statistics<p>In short, this acquisition is problematic from a strategic standpoint and appears to threaten the basis of Southwest's cost advantage.
Two really important bits of backstory to this, if you don't follow the US airlines: Southwest is famous for flying a single plane type (the 737) and for a Greyhound Bus-type route map that differs starkly from the hub/spoke model served by ATL --- the largest "hub" in the US market.
Looking at the fleets, the article does not mention the fact that AirTran has 65 Orders for 737-700's (the type that Southwest uses),
<a href="http://en.wikipedia.org/wiki/AirTran_Airways#Current_Fleet" rel="nofollow">http://en.wikipedia.org/wiki/AirTran_Airways#Current_Fleet</a> and is looking at options to replace its current 717 fleet....
As well as landing slots, increased build slots at Boeing are always very welcome.
> And since Southwest can't grow by adding capacity to current routes (we know the negative cycle that creates), they must find new markets.<p>I don't think I "know the negative cycle that creates." Could I trouble someone to explain it to me?
I feel about Southwest the same way many around here feel about Dropbox; such a great service that gives me exactly what I want.<p>It will be interesting to see how Airtran employees are integrated into Southwest's fold. For some reason I love being cattle-prodded onto a Southwest flight, with the stewardesses giving us fun reminders to be timely. I think the phrase last time was "find a cush for your tush"
Slightly offtopic, but does anyone dislike Southwest? I have spent my entire life flying Continental out of EWR because they were basically the only option and I had a pile of FF miles, but now I'm near 2 Southwest hubs and I'm thinking of making the switch since I'm almost out of Continental miles. It seems very different but I've read a lot of positive things about Southwest.
As someone who flys with his entire family business class to Flint on Airtran multiple times a year, this is going to suck.<p>All of the in-laws are in Saginaw and Flint was simply the best place to fly for those visits.<p>Now? I guess Detroit via Delta because screw flying to GR and driving across.
One of the things many people love about Southwest is their generally relaxed, friendly, and informal atmosphere. Is AirTran similar? Do they tell jokes during the safety demonstration too? If not, do you think they'll start?
Southwest has been ultra-competitive for many reasons, the biggest probably being its fuel hedging program. But it's only a matter of time before this competitive advantage asymptotically approaches zero, so it needs new strategies to maintain its advantage.<p>As a frequent flier and raving fan of Southwest, I've wondered what would change when they once again paid the same price for fuel as the legacy carriers. Today I stopped worrying. This acquisition ought to buy Southwest at least 10 more years as #1.<p>I'm also a frequent flier of Air Tran. AFAIC, except for Jet Blue, no other carrier is in the same class as Southwest and Air Tran. I have little doubt they will figure out how to make this work.<p>Now if only the feds don't fuck this up...
I find this merger interesting, having flown very little on Southwest but quite a lot on AirTran due to Atlanta being a major destination for me. I'm curious to see what changes they bring, however this comes as I find myself more and more frequently paying extra for JetBlue and other carriers that provide a bit more than baseline services.
I've never liked southwest, I flew with them once, and it was generally a bad experience. On the other hand I have always LOVED Air Tran. $50 upgrade to business class, with wifi, and free xm radio. This combination made for one great flight. Loosing that, looses me.
if you are younger than 23, you can book a one-way ticket on airtran for like $69 on the day of the flight. you have to fly standby, and you can't take any luggage, but it's an awesome program that i had taken advantage of.