Southwest Airlines Co. is an American low cost airline. Headquartered in Love Field Drive, Dallas, Texas, it owns the second biggest fleet of airplanes in the world. According to the United States Department of Transportation (USDOT) statistics, since August 2006, Southwest Airlines has been the airline that has worked with most national and international passengers. That makes Southwest Airlines one of the airlines with most profit in the world.
Southwest Airlines has an approximate number of 3.500 diary flights and works with only one kind of airplane: Boeing 737.
The success and benefit of the Southwest business model has been called the Southwest Effect. From Southwest’s initial intention in Texas to make flights cheaper than the cost of driving between two points (in the early 1970s, during the first major energy crisis in the United States), developing a network of flights with price margins that would allow the airline to be profitable, albeit at the expense of untapped flights and high aircraft usage. The key element of the Southwest Effect is that when a low-cost company (or any innovative and aggressive company) enters a market, it changes, and usually grows strongly. For example, when rates were 50% lower than normal rates in that market, the number of customers was not only doubled, but quadrupled as little.
Southwest has been a great inspiration to other low-cost airlines, and its business model copied many times around the world. European airlines EasyJet and Ryanair are two of the most well-known airlines that follow Southwest‘s business strategy on this continent (although EasyJet operates two different aircraft models today). Other airlines with a business model based on the Southwest system are the Canadian WestJet, Malaysia AirAsia (the first and lowest cost in Asia), the subsidiary of Qantas Jetstar (although Jetstar currently flies with three different types of models), The Thai Nok Air and the Mexican Volaris.
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