Topic > Southwest Airlines - 930

With Southwest Airlines' strategy of focusing on short-haul passengers and offering fares as low as one-third of those of competitors, they have seen tremendous growth over the past decade. Market share for major city pairs in Southwest's schedule has reached 80% to 85%. Maintaining the largest fleet of 737s in the world and using a point-to-point rather than hub-and-spoke connection philosophy has allowed Southwest to provide its service to more people at a lower cost. By putting the employee first, Southwest has found the key to success in the airline industry. A happy worker is also more productive and is also a better service provider. Southwest will continue to reserve its growth in the future by entering select markets only after careful market research. Southwest Airlines faced many barriers to entry due to fierce competition from other airlines in the industry. Although the competition was fierce, Southwest Airlines was able to succeed by doing things differently. Their mission was to provide affordable air travel to those who normally didn't fly. In contrast to the rest of the airline industry, Southwest has remained profitable by keeping fares low. Southwest was unique in the industry in two ways. They focused on short-haul travelers and used a method of point-to-point air connections. The short-haul traveler is the backbone on which Southwest was built. The short-distance airline market was large enough for Southwest to maintain a profit for more than 30 consecutive years. Shorter flight times allowed for more flights per day. With an industry average of one to two flights per day, Southwest stands out with an average of 10-12 flights. Maximizing utilization and minimizing flight time were key to Southwest's profitability. If short-haul passenger was the backbone of Southwest Airlines' success, then their 737s were the lifelines sustaining it. By choosing the 737 as the aircraft for all of Southwest's flights, the company saved time and resources in training its employees. Crews could easily be replaced with each other thanks to extensive training on the 737. The low costs and, therefore, low fares represent a huge competitive advantage, when combined with their loyal and high-quality workforce. At Southwest Airlines, a truly unique culture was found among all of its employees.