Southwest

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SOUTHWEST AIRLINES

Executive Summary

Southwest Airlines is the largest low cost airline carrier in the United States. Southwest is headquartered in Dallas, Texas. The airline was established in 1967. It carries the most domestic passengers of any US airline, as of June 5, 2011. Southwest uses only Boeing 737’s, except for a short time during the 1970’s and 1980’s when they used Boeing 727’s. As of August 2012, Southwest is the largest domestic passenger airline operator of the Boeing 737’s worldwide, with over 572 in service, each operating an average of six flights per day.

In May 2011, Southwest acquired Orlando-based AirTran Airways, with integration of the carriers expected to be complete by 2015. On March 1, 2012, the company was issued a single operating certificate so that technically Southwest and AirTran became one airline.

Southwest has more than 46,000 employees as of August 2012, and operates more than 3,400 flights per day. As of December 2012, Southwest Airlines has scheduled service to 78 destinations in 39 states.

Background

Southwest Airlines traces its roots to the March 16, 1967, incorporation of Air Southwest Co. by Rollin King and Herb Kelleher to provide service within the state of Texas. Kelleher believed that by providing intrastate service within Texas, the airline could avoid federal regulation. Three airlines (Braniff,Trans-Texas, and Continental Airlines) started legal action which was not resolved for three years. Air Southwest prevailed in 1970 when the Texas Supreme Court upheld Air Southwest’s right to fly within Texas. The Texas decision became final on December 7, 1970 when the U.S. Supreme Court declined to review the case, without comment.

On March 29, 1971 Air Southwest Co. changed its name to Southwest Airlines Co. Operating from its Dallas, Texas, headquarters, Southwest Airlines began service on June 18, 1971 between the Texas cities of Houston, Dallas and San Antonio using three Boeing 737-200s. The OAG for 15 May 1973 shows 63 flights a week each way between Dallas and Houston Hobby, 25 each way between Dallas and San Antonio, and 17 each way between San Antonio and Houston. Southwest Airlines founder Herb Kelleher studied California-based Pacific Southwest Airlines and used many of PSA’s ideas to form the corporate culture at Southwest. Early flights used the same "Long Legs And Short Nights" theme for stewardesses on board typical Southwest Airlines flights. A committee including the same person who had selected hostesses for Hugh Hefner's Playboy jet selected the first flight attendants, females described as long-legged dancers, majorettes, and cheerleaders with "unique personalities." Southwest Airlines and Herb Kelleher dressed them in hot pants and go-go boots.

The rest of 1971 and 1972 saw operating losses. One of the four 737s was sold to Frontier Airlines and the proceeds used for payroll and other expenses. Southwest continued a schedule based on four aircraft but using only three, so the "ten minute turn" was born and was the standard ground time for many years.

The Wright Amendment of 1979 is a federal law governing traffic at Dallas Love Field, the pre-1974 airport in Dallas, Texas. It originally limited most nonstop flights to destinations within Texas and neighboring states. The limits began phasing out in 1997 and 2005; in 2006 the amendment was repealed leaving some restrictions intact until 2014 but with an added restriction on the number of gates allowed.

When airline deregulation came in 1978 Southwest began planning interstate flights from Love Field, causing interest groups affiliated with Dallas-Ft. Worth Airport, including the city of Fort Worth, to push the Wright Amendment through Congress to restrict such flights. Under the amendment Southwest and other airlines, were barred from operating, or even ticketing passengers on flights from Love Field to destinations beyond the states...
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