Swot Analysis : Southwest Airlines

Southwest Airlines Co., established in 1971 by Rollin King and Herb Kelleher, began its operations with only three Boeing 737 aircrafts. It is headquartered in Dallas, Texas(Hawkins, Misra, & Tang, 2012). Southwest is well known as one of the largest low-cost carriers. With this strategy, the company has dramatically grown up and deeply rooted in the US airline industry. Now, Southwest Airlines Co. operates 633 aircrafts to 93 domestic cities and the highest number of passengers used Southwest Airlines to fly around U.S in Jan 2014 (Hawkins, Misra, & Tang, 2012). To accomplish more than 40th consecutive years of both profitability and competitiveness, Southwest Airlines Company is constantly trying to find the routes to differentiate itself from other domestic carriers (Hawkins, Misra, & Tang, 2012).

Bargaining Power of Customers (high)- Customers has several options when it comes to flying. But the main attraction to customers are low prices and Southwest makes it known that they have some of the lowest airfares. The only way Southwest can take back the power is by offering direct flights to cities that other airliners do not offer. Besides the small occurrence of having a direct flight to a city that no other airline has, Southwest

Delta’s Management team is seeking to strengthen the company’s market and financial position by proposing to acquire American Airlines. An assessment of American Airlines business operations, its resources and environment will identify the company’s operational and financial strengths, weaknesses, possible opportunities and threats. This will enable Delta to recognize the best strategy to create the most effective synergy for this acquisition. Evaluating the SWOT analysis on American Airlines is a core requirement and a key step to assessing the feasibility of the acquisition; detecting its operational and financial factors could have a profound effect that can assist Delta in determining the strategic direction that would be advantageous to the company.

It’s never easy for a company to be the number one company as there’s always bound for mistakes to be made and sometimes it takes an organization to face hard times in order for them to succeed. One company I look at that has faced hard times and strong competition is Frontier Airlines. Over the past years of this organization has went from being one of the best airlines to know one of the top worst airlines for both customers and employees. This company has had to sacrifice a lot throughout its time and it has changed its reputation that now you find other airlines following in the same footsteps. Airlines have also been very unethical to its customers and the public as they have been overbooking flights and not handling the situations in an ethical and respectful way.

Southwest Airlines (SWA) maintained a low-cost, low-price and no frills strategy. The small Texas carrier began as a concept, its business plan detailed on a cocktail napkin in 1971 and grew into the nation’s fourth largest airline. Known as an innovator with low operating costs, dominating smaller airports, with a humorous customer service, SWA saw its 40th profitable year in 2013. Like all companies, SWA underwent leadership changes in 2001, and said goodbye to the company’s founder in 2008. Unfortunately, the changes in leadership were not the only changes; the organization proceeded to alter their beliefs and activities.

Today Southwest Airlines is the biggest domestic passenger carrier in the United States of America operating more than 3,400 flights a day. They provide service to 93 cities and 5 countries internationally. Last year Southwest Airlines, “Enplaned approximately 136 million Customers (About Southwest). The airline has grown since it’s first years flying out of Love Field in Dallas, Texas. In the beginning, Southwest provided flight service to only three Texas cities in 1971. One of Southwest Airlines’ early advertisements was a double page ad that ran in Dallas newspapers during May announcing their first flight on June 18, 1971 (Lusk). This advertisement introducing a new airline would soon revolutionize the airline industry and create the new category, of low cost carrier, to the world.

This paper will give a historical overview of the company, discuss the ingredients to the company success, offer some financial strengths and present a final conclusion. Section I: Southwest's History Twenty-seven years ago, Rollin King, a San Antonio entrepreneur who owned a small commuter air service, and Kelleher, who was a lawyer at the time, got together and decided to start a different kind of airline. They began with one simple notion. If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make certain they have a good time doing it, people will fly your airline. And you know what? They were right. Within those 27 years, Southwest Airlines became the fifth largest major airline in America. Today, they have flown over 50 million passengers a year to 54 cities all over the southwest and beyond. They do it over 2,300 times a day with over 267 of the newest jets in the nation and fly only one type aircraft; the B-737. The average age of their fleet is only 8.4 years and they own over sixty percent of them. In May 1988, they were the first airline to win the coveted U.S. Department of Transportation Triple Crown for a month - Best On-time Record, Best Baggage Handling, and Fewest Customer Complaints. Since then, they've won it

Southwest Airlines Company is a well-known low-cost American airline that offers excellent customer and employee service. As of 2009 Southwest is the largest airline company in the world that carries the most number of passengers and it is the third largest passenger fleet of aircraft among the world’s commercial airlines. It also boasts the highest number of customers than any other airlines in the United States. This data come from the U.S. Department of transportation’s Bureau of transportation Statistics. Given the above information, Southwest has been posting profits for the past 37 years [3]. The reason why Southwest has been able to cope

Southwest Airlines (SWA) is the world’s largest ‘low-cost’ air carrier that is headquartered in Dallas, Texas, and operates more than 3,400 domestic flights on a daily basis. The company provides scheduled airline service to 42 states and Puerto Rico, carrying the most domestic passengers of an airline based in the United States [9]. Founded in 1967, and commencing operations in 1971, Southwest Airlines has always had a unique and breakthrough business model which has allowed the airline to maintain its loyal customer base and profitability [2]. Over the years, Southwest has maintained one of the best customer service records, and its safety record is unmatched in the industry [9].

The increase in Internet usage is key as they are heavily marketing themselves on the Internet. Competition is another factor as it is both positive and negative, as it is the fuel to which makes Southwest a growing company while they thrive off of competition. It makes the employees closer as well as makes the company stronger. Competition of course also hurts revenue, as the major airlines that offer more services with competitive rates are taking away Southwest 's customers. Negative factors include mostly competition as stated before as well as the economy going down. Fear of flying is another factor as people look towards other ways of travel rather then flying. Tax requirements are another key factor as the new tax system replaces a percentage tax with a tax that includes a flat, per-segment fee that hits low-fare carriers harder such as Southwest.

US Airways completed a merger in December 2013 . This merger provided much needed cash infusion into American Airlines, enabling it to emergency from

Southwest Airlines' business controls extremely efficient operations, focus on the customer experience, low-cost pricing solutions, active thinking, and a motivated team of employees and associates. By using this specific strategy, Southwest has accomplished multiple competitive advantages that have allowed them to stay relevant in a growing environment. Southwest's ability to higher good recruits, offer point programs and rewards, and provide low-cost transportation are a few reasons why they are a success and will remain a success. One could say that their ability to hire the best recruits is one of their biggest competitive advantages and successes. Southwest prides

Southwest Airlines was founded and incorporated in 1971 in the State of Texas by Herb Kelleher and Rollin King. These two men identified a target market of potential customers serving the Dallas, Houston and San Antonia regions who would normally drive rather than fly to locations that was less than 500 miles (Smith, 2004). Therefore, Southwest first home office was in Love Field, Texas, which was befitting as the organization’s name on the New York Stock Exchange is LUV, emphasizing their “love” for their employees and customers as a core behavior of the organizational culture (Klein, 2012). After forty-six years in business starting with 4 planes, the airline has now accumulated a fleet of 723 Boeing 737 aircrafts, serving 101 locations, in 40 states, including Puerto Rico, and internationally, Mexico, Jamaica, the Bahamas, Aruba, Dominican Republic, Costa Rico, Belize and Cuba (S&P Capital IQ, 2017). Moreover, this airline of almost 56,000 employees, is considered one of the worlds most successful airlines, generated close to 21 billion in revenue for 2016, and has been dethroned from the largest passenger carrier airline in the world to the fourth, due to industry mergers

Southwest has upheld its originally strategy of “low cost” since its inception. It turned the airline industry upside down and today is one of the most beloved airlines that U.S. citizens use. On average, Southwest reserves “55,167 reservations daily” and still has plans to grow and expand. (1972 to 1977,

Southwest Airlines was created in the late 1960’s by a businessperson Rolling King, and law school graduate Herb Kelleher, who sought a faster travel time between Houston, Dallas, and San Antonio, Texas (Dess, et al., 2014, p. C137). After overcoming all of the antagonism and legal problems of many major airlines, Southwest was able to take its first flight in 1971 (Dess, et al., 2014, p.C137). With a dedication and will power to grow the company, King and Kelleher sought out ways to increase growth.