Southwest Airlines, Inc. Essay

2198 words - 9 pages

Company Background/Business ModelSouthwest Airlines, Inc. began in 1966 as an idea of Rollin King, an entrepreneur who owned a small commuter air service. The business model for the airlines was to attract passengers by flying convenient schedules, getting passengers to their destination on time at the lowest possible fares, and making sure they had a good experience. The airlines would service travelers going between Dallas, San Antonio and Houston. During the inception more than 30 years ago SWA didn't have a smooth take-off when it received the permission to fly the skies. Their competitors such as Continental Airlines, Texas International and Braniff took them to court and obtained an order to bar them from flying until a decision was reached at the trial. The argument put forward by these three airlines was that there was not enough traffic to support the existing airline companies. The court ruled in favor of these three companies. SWA was represented by Herb Kelleher in the follow up trials held at the Appellate court where they lost and at the Texas Supreme Court and U.S. Supreme Court where they won both the times and received permission to start flying.Southwest Airlines is the fifth largest airline company in America, operating more than 2,100 flights per day and carrying over 44 million passengers a year to 50 different cities all over the United States. Southwest boasts the best on-time record, best baggage handling, and fewest customer complaints in the airline industry and won the industry's Triple Crown award for Best Airline five times in a row from 1992-96. It was the first airline with a frequent flyer program to give credit for the number of trips taken, not just the number of miles flown, and also pioneered senior discounts, Fun Fares, Fun Packs, a same-day air freight delivery service, ticket-less travel, and many other unique programs.Southwest is the only airline that has made money every year since 1973, with stock values up more than 500% since 1990. An investment of $1000 in Southwest stock in 1973 would be worth over $1.8 million today. Southwest's stock trades at about 20 times on earnings, double the industry standard, and Wall Street Investor Peter Lynch says "Southwest's (stock) performance has yet to be outdone." Its net profit margins averaged over 5%, the highest in the industry, since 1991.Southwest Airlines, Inc. MissionDedication to the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.Southwest's mission to their employees - We are committed to provide our employees a stable work environment with equal opportunity for learning and personal growth. Creativity and innovation are encouraged for improving the effectiveness of Southwest Airlines. Above all, Employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest customer.Southwest's...

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