Hawaii has been a profitable niche for Alaska Airlines for a long time. But now the market is under siege. Competitors want their slice of the profits.
There's no way around it: Southwest's new emphasis on cost-containment, productivity gains, and other efficiencies doesn't provide an optimistic outlook for passenger experience. It should make Southwest a more profitable airline — if passengers go along for the ride.
Southwest has survived by being different. That gets harder, but the lessons of its past success may help define its legacy. The Texas-based airline is one of the subjects in Skift’s recent sixth anniversary book, For the Long Haul, Lessons on Business Longevity, whose chapters we are excerpting for you here.
Southwest Airlines wants to keep its passengers happy, booking quickly, and coming back. In this video, Chief Revenue Officer Andrew Watterson explains some of the ways the airline achieves that goal.
You have to give Southwest Airlines CEO Gary Kelly credit. Analysts are constantly prodding him to embrace tried-and-true approaches for generating ancillary revenue. For the most part, he resists. He doesn't want to mess with the airline's secret sauce.
When Delta Air Lines launched Basic Economy, it allowed a free carry-on bag. When American Airlines subsequently launched a similar fare type, it barred free carry-ons, and that has turned out to be a poor decision because American has been losing market share to Delta.
The Department of Transportation's inspector general has several ongoing audits trying to measure the effectiveness of the Federal Aviation Administration. That's probably a nuisance to the FAA, but it's not necessarily a bad thing. Oversight is important.
In the airline industry, bigger is almost always better. But Hawaiian Airlines is betting its unique niche will help it as more competitors add capacity in its markets. Still, the airline could someday be a takeover target for another airline that wants to grow.
Hawaiian Airlines executives are talking a big game about how they're ready for competition from Southwest Airlines. Is it true? Or are Hawaiian's executives nervous behind the scenes as they prepare for Southwest's Hawaii expansion?