Southwest AirlinesSouthwest Airlines
Submitted by: Ravi Bhagwat (11030141092)
Sahil Chopra (11030141085)
LUV
Timeline… June 18, 1971
Began airline service, HQs in Dallas, Texas Flights to Houston, Dallas, and San Antonio
1977 SW stock listed on NYSE as "LUV"
1982 Appointed Herbert D. Kelleher President, CEO, & Chairman of the Board
1984 #1 in customer satisfaction (4th year in a row)
1990 Announced billion dollar revenue mark Officially declared a "Major" airline!
May 2003 Top ranked domestic passenger airliner
2006 Southwest’s 34th consecutive year of profitability
Facts / Milestones…
Low-fare, high frequency
Point-to-point carrier
Largest domestic U.S. carrier
Largest airline in America
More than 34,000 Employees
More than 3,200 flights a day
Top competitors:
AMR Corp.
Continental Airlines
JetBlue
Fly more than 64 million
passengers a year
58 destination cities (59
airports)
One Plane fits all
Point to Point flying
Simple In-flight service
No frills, No fees
Strong Management
A relatively happy workforce
Aggressive fuel hedging
Secrets of SuccessSecrets of Success
• Fuel hedging • Purchased fuel options for years in advance to
smooth out fluctuations in fuel costs• Substantially increased its hedging in 2001 in
response to projections of increased crude oil prices
• Operated only one model of aircraft• Boeing 737, medium range-narrow body
commercial passenger jet aircraft• Easy to replace parts and ground support
equipment
Basis for profitability
Business Segment
Service in markets with of frequent, conveniently timed flights and low fares.
Business travelers who more time-sensitive than price-sensitive and wanted weekday flights at times suitable for conducting business.
Price-sensitive leisure travelers who wanted lower fares and had more flexibility about when to fly.
ACQUISTIONS
MUSE AIRLINES/TRANSTAR AIRLINES in 1985
MORRIS AIR in 1993
ATA AIRLINES in 2008
AIRTRAN AIRWAYS in 2011
SWOT Analysis ...SWOT Analysis ...
Strengths♥ Low price tickets ♥ Low operating costs♥ Good customer service♥ High frequency service ♥ Productive pilots & ground crew
Opportunities♥ Ability to add scheduled flights ♥ Low prices enable market share
growth
Threatso Big companies emulate
Southwest's low cost modelo Difficulty securing new gates
at existing airports
Weaknesso Doesn’t serve international
flightso One type of airplane
Market Share ...Market Share ...
Year 2006 : Market Share
ConclusionConclusion ... ...
♥ "Its part of our culture. We’ve always said we'll do whatever we can to take care of our people. Thats what we’ve tried to do.“
♥ Southwest Airlines was able to operate their business relatively undisturbed. It was only in the poor economic conditions that suddenly Southwest Airlines' method of operation became the ideal model for its competitors.