The Archetypical Low-Cost Air Carrier: Southwest Airlines :: Aviation Southwest Airlines Flying Essays

AbstractThe seventh largest major domestic air passage in the United States (US), Southwest Airlines, is commonly known or referred to as a low-cost carrier. Southwest Airlines is the only major airline that provides short-haul, point-to-point service in the United States. In fact it was the first airline of its type of all time started it has become the archetypical low-cost airline. The idea has proved itself so well, that otherwise start-up airlines have based their company strategies upon the basics of Southwest. Today, there are twain other low-cost air carriers (the other two airlines are considered case airlines and not major airlines) that are actively and aggressively competing with Southwest Airlines for chore and profit turning. The three Ameri burn down low-cost air carriers are before long posting profits even in light of the US preservations current state of affairs, with Southwest Airlines first, JetBlue second, and Air Tran third, in profits. How is this pr actical when the major six airlines are reporting losses of millions and millions of dollars each take in? The answer to this question begins about 30 years ago. The Archetypical inexpensive Air Carrier Southwest AirlinesThe product unmatchable airline can buoy offer is the same exact product the next airline can offer, a single available seat mile (ASM) for sale. The difference mingled with the airlines lies in the marketing, routing, pricing, executive decision-making, and the operating strategies that each airline chooses to espo custom regarding that one product. It is through these strategies that an airline must find productivity in chalk up revenue passenger miles (RPM) flown to be profitable. When the ASM is filled with a fare-paying passenger, sales or income is recognized, and it converts to an RPM. The relationship between the ASM and RPM are directly related and is verbalized in percentages known as Load Factors (LF). This LF is a management rotating shaft used t o determine the efficiency and health of the airline. It is necessary to keep these two variables in balance of each other. Southwest Airlines load factors are be in Figure 1 and 2. RPMLF = ASMMany airlines choose to use the hub network, which induces costly effects in all areas of the airline. It is the point-to-point short haul airline that is capable of keeping costs low and turn profits, Southwest Airlines has proven just that. Southwest Airlines survived the initial years of deregulation, years of cyclical problem cycles that may have led to recessionary and or inflationary periods, and its 25-year