Category: Airline Company

Southwest Airlines

[URIS id=49]

Headquartered in Dallas, TX, Southwest Airlines is America’s largest carrier that offers low-cost air travels across a network of 98 destinations in the USA and seven other countries. Boasting to have served more passengers domestically than any other airlines, Southwest Airlines quickly skyrocketed to fame for its unique combination of low fares without any annoying fees as well as friendly customer service delivered by highly competent staff, safe and reliable operations, and an excellent corporate culture that extends into the communities they serve.

The airline was founded in 1966 by Rollin King and Herb Kelleher. A year later, the company was incorporated as Air Southwest Company. And, after four years, the carrier took on its present name – Southwest Airlines. It was also only in 1971 when the airline started its first commercial flights originating from Dallas Love Field. And by 2014, Southwest Airlines achieved the highest record for having carried the most domestic passengers of any American airline. As of July 2016, the airline proudly employs more than 50,000 well-trained personnel working together to deliver outstanding customer service throughout the Southwest system. The airline operates more than 3,900 departures per day during peak travel season and has scheduled services to 98 destinations in America and seven other countries. And by late 2016, Southwest is also expecting to service three more airports in Cuba, though it’s still subject to governmental approvals.

Since its inception, the airline has maintained to use only Boeing 737s, with the exception of the period from 1979 to 1987, when Braniff International Airways had rented out some of its Boeing 727s to Southwest. In January 2016, Southwest Airlines became Boeing 737’s largest operator around the globe, with about 714 in service, each averaging 5 to 6 flights per day.

Due to Southwest’s success, it has been a huge inspiration to other low-cost carriers, and its business strategy has been replicated a lot of times around the world. The competitive strategy combines an extraordinary level of aircraft and employee productivity with low unit costs by keeping aircraft turnaround time to a minimum, particularly at the gate. Europe’s Ryanair and EasyJet are two among the well-known airlines to adopt Southwest’s business model in the European continent. Other airlines who followed suit and have also implemented Southwest’s business model include Malaysia’s AirAsia, Indonesia’s Lion Air, Thailand’s Nok Air, India’s IndiGo, Philippines’s Cebu Pacific, Qantas’s Jetstar, Turkey’s Pegasus Airlines, Mexico’s Volaris, as well as Canada’s WestJet. Though Southwest has been a major inspiration to many other airlines, including Jetstar, Lion Air, AirAsia, and Ryanair, the management strategies, for example, of Jetstar, Lion Air, AirAsia, and Ryanair differ significantly from that of Southwest’s. All these various management stratagems can be seen as means of differentiation in order to gain competitive advantages over other competitors.

To promote the carrier and effectively catch the public’s attention, Southwest Airlines has made use of humor in its advertising. Slogans include “You’re Now Free To Move About The Country,” “The Somebody Else Up There Who Loves You,” “THE Low Fare Airline,” “Love Is Still Our Field,” “Welcome Aboard,” “Grab your bag, It’s On!” and “Just Plane Smart.” At present, the airline’s slogan is “Low fares. Nothing to hide.”

In March 1992, soon after Southwest began using the “Just Plane Smart” epigram, Stevens Aviation, which had been making use of the phrase “Plane Smart” for its slogan, warned Southwest that it was infringing on its trademark.

But instead of filing a case, the CEOs of both companies agreed to stage an arm wrestling match. The said match was set for 2 out of 3 rounds. The loser of every round was to pay $5,000 to the charity of his choosing, and the winner gets to use the trademarked slogan. A promotional videotape of the bout was produced showing both of the CEOs preparation for the match (with Southwest CEO Herb Kelleher being helped up while doing sit-ups where a glass of whiskey and cigarette was waiting) and was given away to the employees and was also distributed as video press release together with the video of the match itself. Although Herb Kelleher did not win the match for Southwest, Stevens Aviation’s CEO Kurt Herwald straight away allowed the usage of “Just Plane Smart” to Southwest Airlines. In the end, both companies benefited by getting to use the trademarked phrase, a total of $15,000 going to charity, and great publicity for both companies.

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