A study of the current and future state of growth and acquisition strategy, by Thunderbird students Manash Banerjee, Owen Chen, Chris Hardesty, William Keller and Dustin Ward
“If the Wright Brothers were alive today, Wilbur would have to fight Orville to reduce costs.” — Herb Kelleher, founder of Southwest Airlines
Southwest Airlines (SWA) transports more passengers (101M) than any other US carrier while maintaining an 80%+ on-time performance rate. Further, SWA recorded its 39th consecutive year of profitability1 – a remarkable accomplishment for a company that previously did not fly outside of Texas and especially considering the general turmoil and collapse of the airline industry as a whole. SWA is known for its committed approach to short-haul, point-to-point service with “no frills”. Nevertheless, the question for the future is – how can SWA continue its low-cost advantages and current operational strategy to achieve successful growth targets? In other words, where is the next blue sky for SWA?
Strategic Challenges for SWA in the Current State