Southwest Ob

Company Introduction

1958 marked the beginning of the jet aircraft age in commercial passenger airline service (Smithsonian National Air and Space Museum, 2007). Less than thirteen years later, a small Texas intra-state airline, Southwest Airlines Co. (“Southwest”), initiated services on June 18, 1971, three years after its incorporation (Southwest Airlines Co., 2014). Southwest had 195 employees and four aircraft serving four Texas cities with 6,051 trips at the end of 1971. Seven years later, a few months before deregulation, Southwest consisted of 892 employees providing 35,415 trips with ten aircraft. On October 24, 1978, President Jimmy Carter signed the Airline Deregulation Act into law, the first time in U.S. history that an industry was deregulated (Smithsonian National Air and Space Museum, 2007) establishing an environment in which Southwest would thrive and eventually dominate the domestic air travel market in the United States. Southwest ended 1978 with 1,119 employees and thirteen aircraft providing 54,816 trips.

As of the close of 2013, Southwest’s 44,831 employees and 680 aircraft made over 1.3 million trips during 2013. Southwest employees service ratios were 66 employees per aircraft and 3.41 employees per 100 trips for 2013 as compared to Southwest’s pre-deregulation, ratios of employees to aircraft and employees per 100 trips were 89 and 2.52, respectively. On January 23, 2014, press release, Southwest reported its 41st consecutive profitable year. Southwest is the largest domestic carrier as measured by passenger enplanements, providing services to “[…] 93 destinations in 40 states, the District of Columbia, and the Commonwealth of Puerto Rico (Southwest Airlines, 2014).” Its nearest competitor, Delta Airlines, enplaned over one million fewer passengers, or 20 percent less than Southwest’s enplanements for the same period (United States Department of Transportation, Bureau of Transportation Statistics, 2014). Southwest’s supremacy...