Alaska Airlines, Inc. It boasts a fleet size of aircraft with destinations and approximately daily flights. The Company will add 17 new jets to its fleet between and , increasing its fleet size to In , it held 5.
As of June 30, , it held 4. It competes with Southwest Airlines by providing a personal, customized experience through its Alaska beyond Fares. However, it will need to improve revenue per seat mile and cost efficiency to stand out. Southwest Airlines maintains its position as one of the top low-cost carriers.
The Company derives a competitive advantage from the low-cost business model, superior customer service, and first-mover advantage among low-cost carriers.
Despite its strong position, its continued focus on employing the right people, providing a relaxing atmosphere, and maintaining a commitment to its core values further its market standing. Not only is the Company an industry leader, but it also competes against its reputation.
Its flexible policies make flying with Southwest Airlines convenient, allowing customers to travel without the inconvenience of hidden charges. Passengers can cancel the flight 10 minutes before departure without incurring any fees. Such customer-friendly policies set the Company apart from its peers. The Company will continue to stand out against competitors by prioritizing environmental sustainability.
Answer: Southwest Airlines has a low-cost business model with an open seating policy, which is unique among airlines. Southwest Airlines also improves its customer service by hiring the right people and providing benefits for its employees. The Company maintains a high degree of flexibility, which allows customers to travel without the inconvenience of hidden fees.
It also positions itself as an industry leader by capitalizing upon emerging opportunities such as its strong digital customer service strategy and eco-friendly practices. Southwest Airlines maintains its reputation as one of the most successful low-cost carriers. Its firm brand name and a very efficient network give it a competitive advantage. On the other hand, low-cost carriers are highly dependent on fuel costs.
However, it must prioritize reducing fuel consumption before implementing stringent cost management policies. Southwest has been named the nation's largest carrier in terms of domestic passengers boarded Southwest Airlines, With new destinations continually being added, including recent additions to the Caribbean, Southwest continues to emerge to be a larger market player, with a possibility to expand into the Latin American market.
Southwest is particularly important to analyze because of their glowing customer reviews and promising financial results. By conducting competitive intelligence analysis on Southwest Airlines, American Airlines can be better suited to respond to market changes in the future. To better understand Southwest's position within the industry, some basic information will be further discussed including history, sales, market, partnerships, competitors, business model, management, employees and finances.
Southwest Airlines was founded by Rollin King and Herb Kelleher, and began service in between major cities in Texas. With a focus on customer service from the beginning, Southwest was the first company to offer frequent flyer programs, senior discounts as well as fun packages Aviation Online Magazine, Southwest remains the only airline to offer free checked baggage, sticking to their policy that they intend to keep costs low Southwest Airlines, In , Southwest was ranked number one in customer service for the fourth consecutive year.
In , Southwest exceeded the billion-dollar revenue mark. Following, Southwest continued to set a standard for the airline industry, and in was named the fifth largest US air carrier. Major innovations along the way included in the introduction of ticketless travel and the introduction of their webpage, which was the first of the major airlines.
In , they began service outside of the continental 48 states with service to Puerto Rico. In , they became an international airline with service to Jamaica, Bahamas and Aruba Southwest Airlines, Grand Cayman is the 9th international country, with service beginning in June In line with their low-cost policy, Southwest manages their sales differently than other lager retailers.
The product line, key sales channels and marketing efforts will be discussed next. Southwest's product line consists of domestic, as well as a few select international flights. Being a low-cost carrier, they do not offer premium seats within the cabin, rather every seat is the same and at the same price. The only sales channel for Southwest is through them directly. Their tickets were mostly sold by phone, at the airport, or in the office, but sales were always made directly by Southwest.
Now, Southwest still does not use third party sites, known as Global Distribution Systems. Distribution costs of tickets drive up prices, and to stick with the low-cost travel, Southwest aims to keep these costs at a minimum Kuebler, Thus, the Southwest website is the main distribution channel for airline tickets. Southwest uses marketing to portray both their low costs as well as exemplary customer service.
That means Southwest has bigger reserves in cash, credit, and other assets than smaller airlines. Bigger doesn't always mean better, but it usually does mean safer when it comes to investing.
Controlling costs is also crucial to surviving a downturn, and Southwest does well there too. Low-cost carriers , such as Southwest, have several critical advantages over their competitors. They focus on providing the lowest prices for the most popular routes, which means fewer routes will need to be abandon. Negative economic growth will also make businesses and consumers more sensitive to ticket prices, the low-cost airlines' primary advantage. Southwest is the only large airline that can compete on price.
While Southwest Airlines' entire business model is important, arguably the most valuable competitive advantage has been its deep focus on hiring the right people.
Southwest prides itself on being a people-oriented airline that operates with friendly and approachable employees and team members. Per its business model, Southwest hires employees who embody the company's brand messaging and who have a passion for helping customers.
Southwest has stringent hiring practices and policies to ensure the right mix of team members. Southwest Airlines has a business-oriented focus on the customer's experience. Part of that customer experience comes from the attitude and helpfulness of the employees it hires.
However, there are many more factors that go into this competitive advantage. Southwest Airlines has set various policies and procedures that make flying with the airline easy. One of these is Southwest's cancellation policy. They allow a customer to cancel a reservation up to 10 minutes before the flight's departure.
More importantly, the funds from the cancellation are available for a future trip. Policies like this one ensure that the customers of Southwest Airlines remain satisfied. These flexible policies help the airline to build high levels of brand loyalty. Southwest Airlines also has one of the better rewards programs in the industry.
Southwest gives points to customers. They can use the points to purchase future flights. It also has a partnership with Chase Bank and offers customers a Southwest credit card. Delta Air Lines is headquartered and has its largest hub in Atlanta, Georgia. Its other major hubs are in Minneapolis-St. Paul, Detroit, and Salt Lake City. Prior to the onset of the pandemic, it offered more than 5, daily departures and as many as 15, affiliated departures including via the SkyTeam alliance, of which Delta is a founding member.
Delta served about million customers in , a figure which dropped to 70 million in As of end-December , Delta Airlines had mainline aircraft within its fleet, of which were active and 90 were parked temporarily. On a revenue passenger mile basis, Delta is ahead of Southwest Airlines, about even with United Airlines, and lags behind American Airlines. Below we look at Delta's top competitors in greater detail. As of end-December , United Airlines operated mainline aircraft. United targets the same customer groups as Delta: the upper-middle class, high-net-worth individuals HNWIs , and frequent business travelers.
Both are known as premier airlines offering high-quality service. United is a member of the Star Alliance, which serves nearly 1, airports in countries.
Southwest Airlines LUV has had a major impact on the airline industry since launching service in Texas in with just three planes. It is known for friendly customer service and cheap flights to secondary airports along popular, high revenue routes.
The airline relies solely on the Boeing for all routes, which minimizes maintenance expenses. As of end-December , Southwest operated Boeing aircraft and flew to airports in 40 states. Southwest Airlines transported nearly Southwest targets middle-class fliers as opposed to luxury or business class travelers. It is also more dependent on the domestic travel market compared to Delta.
As of end-December , the company operated mainline aircraft and regional aircraft.
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