The Southwest - AirTran Merger

Southwest got started at Dallas Love Field in 1971, as a Texas intrastate discount carrier with 3 Boeing 737 jets, the aircraft on which the company standardized, and has operated every model of the 737. When airlines were deregulated in 1978, Southwest already served all Texas cities it currently serves. Starting with New Orleans in 1979, it quickly expanded to neighboring states. Today it is the biggest domestic airline carrying the most passengers, and still based at Dallas Love Field where it all started.

Southwest now carries a third of traffic at Tampa International Airport, and the merger with AirTran will bring market share to 40%. The AirTran merger brings new changes and markets to the Southwest flight plan.

First, it gives Southwest entry into the coveted Atlanta market, which has been dominated by Delta for decades.
Second, Southwest gains entry into another sought after destination, Washington National Airport.
Third, it brings Southwest into several new markets such as Sarasota, Florida and Gulfport, Mississippi.
Fourth, It gets entry for the first time into international markets with service to San Juan, Puerto Rico and Cancun, Mexico that were recently started by AirTran.
Fifth, Southwest has decided to retain the 86 Boeing 717s flown by AirTran, a departure from it's one type policy.
The small economical 717 will be a good fit for the smallest markets in the greatly expanded network.

Southwest was originally interested in buying Denver, Colorado, based Frontier Airlines, but that went to another suitor. The company has mostly followed a pattern of quickly moving into markets where other carriers have cut back or abandoned service. Recently USAirways had greatly reduced service at Pittsburgh,PA, where it previously had a major hub, and both Southwest and AirTran wasted no time to fill the gap.

Sources: www.wsj.com/business/ 9/29/1010
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