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Southwest Airlines Portfolio

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Southwest Airlines Portfolio

  1. 1. Running head: SOUTHWEST AIRLINES PORTFOLIO 1 Southwest Airlines Portfolio Amber Berlin 2012
  2. 2. Running head: SOUTHWEST AIRLINES PORTFOLIO 2 Abstract Southwest Airlines has been a successful low-cost carrier for the last 39 years. The direction of this company is a result of innovative leadership and proper management of its assets. The cost-driven nature of Southwest Airlines sets the stage for simplified operations, and illuminates the path to efficiency. Optimal utilization of assets is paramount to success, and with the assets of the recent AirTran acquisition, Southwest Airlines must not deviate from the strategic management decisions that ensured its success. This company is a prime example of using persistence, innovation, and appropriate risk taking for entrepreneurs world-wide. This portfolio contains detailed information on the history, structure, finances, and future expansion that provides a successful foundation for potential investors.
  3. 3. Running head: SOUTHWEST AIRLINES PORTFOLIO 3 Introduction The events of September 11, 2001 had devastating effects on the airline industry, causing the majority of U.S. carriers to experience several years of lost revenue. With the economic crisis of 2008, the airline industry also experienced massive setbacks in growth. In contrast, Southwest Airlines has operated in profitability for 39 consecutive years, holding a solid position in the face of various economic inconsistency and industry disaster. This company has taken an uncommon path to stability and financial success. Their high standard of excellence paired with the unique combination of personnel and leadership have shaped a solid foundation not easily replicated. This portfolio is a comprehensive look at Southwest Airlines, including: history, finances, personnel, asset utilization, scheduling, cargo management, international operations, and marketing strategy. Each section reveals the efficiency created by continually striving for excellence. Southwest Airlines is on a path to expansion with the addition of international flights, increased cargo services, and sound financial decisions. Potential investors should take a close look, as this company’s success could also be their own. History In an industry which experiences regular ups and downs, Southwest Airlines has managed to stay at the top of their game. A product of the innovative minds of Rollin King and Herb Kelleher, the originally named Air Southwest Company was incorporated in 1967 (History of Southwest Airlines, n.d. ). With the vision of a commuter airline serving Dallas, San Antonio, and Houston, King and Kelleher were granted permission to fly by the Texas Aeronautics Commission in 1968 (International Directory of Company Histories, 2005). However, three competing airlines filed suit against Air Southwest Company, determined to keep them on the ground (International Directory of Company Histories, 2005). After a lengthy legal battle,
  4. 4. Running head: SOUTHWEST AIRLINES PORTFOLIO 4 which ended up in the U.S. Supreme Court, Air Southwest Company was cleared for takeoff (History of Southwest Airlines, n.d.). On June 18, 1971, after changing its name to Southwest Airlines, the company finally began operations in Texas with a fleet of three Boeing 737’s (Fact Sheet, 2012). Targeting the commuter market, and staying within the confines of Texas to avoid federal pricing regulations, Southwest Airlines was able to undercut the competition (Innovators: Herb Kelleher, n.d.). Under the direction of M. Lamar Muse, the company set themselves apart with “beautiful flight attendants with unique personalities”, and dressed them in hot pants and go-go boots (International Directory of Company Histories, 2005). With the deregulation of the airline industry in 1978, Southwest Airlines had the opportunity to expand outside of Texas, and cautiously entered new markets (International Directory of Company Histories, 2005). One advantage of the company’s leadership is their ability to find market demands not addressed by the major carriers. These untapped markets were approached with the highest standard of customer service, safety, and a unique style that incorporated fun into the otherwise mundane event of business air travel. The result was top customer service rankings, a sound safety record, and more departures than any other U.S. airline. Southwest Airlines quickly climbed the ranks and positioned itself as a top competitor in the airline industry, never losing sight of the motivation to keep costs down. While other airlines tout first class amenities, Southwest has consistently offered only coach class, open seating, and no meals (Drake, 1998). With the realization that a single type of aircraft would reduce training and maintenance costs, Southwest Airlines flies only B737’s with the GE engine. Additionally,
  5. 5. Running head: SOUTHWEST AIRLINES PORTFOLIO 5 in 1997, the online booking site was launched, further contributing to their ability to offer inexpensive travel options for the budget-minded flier (International Directory of Company Histories, 2005). In 2011, Southwest Airlines experienced its 39th consecutive year of profitability (Fact Sheet, 2012). This astounding record has held strong through turbulent times, as Southwest watched other airlines declare bankruptcy and leave the industry. The visionary leaders of this company have everything to do with its long-term success. With moves such as reducing the average plane turn-around time to 15 minutes, Kelleher estimates a savings of $600 million in fleet costs, as compared to the 45-minute average turn-around that has become the industry standard (Jaffe, 1991). Company Drivers There are generally two types of airline, those that focus on lowering cost, and those that focus on generating revenue. The managerial focus of the airline determines the specifics of the operating environment, including the choice of point-to-point or hub-and-spoke operations, leasing or buying the aircraft, type of aircraft flown, and the number of people hired to support the endeavor. According to a study on the drivers influencing an airline’s operating income, “…an airline can either choose to be a cost-driven or revenue-driven airline, but it is hard to be both” (Chopra & Lisiak, 2006). While each airline has a choice, the focus of one is not necessarily better than the other. Both systems of operation play a vital role in the aviation industry by complementing each other and satisfying different portions of the market demand. According to Chopra & Lisiak,
  6. 6. Running head: SOUTHWEST AIRLINES PORTFOLIO 6 low-cost carriers with point-to-point networks have an advantage in terms of employees per ASM [Available Seat Mile] that allows them to lower cost. In contrast, legacy carriers with hub-and-spoke networks have an advantage in terms of revenue per RPM [Revenue Passenger Mile] and load factors that allow them to grow revenue. (2006) Southwest Airlines operates on a point-to-point route structure, which is supportive of their low-cost company focus. The main airports served by Southwest Airlines include locations such as Chicago (Midway), Phoenix, Denver, and Oakland (Table 1). Table 1 Top Ten Airports- Southwest Airlines Cities Daily Departures Number of Gates Nonstop Cities Served Established Chicago (Midway) 238 29 56 1985 Las Vegas 225 19 55 1982 Baltimore/Washington 195 22 48 1993 Phoenix 180 24 49 1982 Denver 162 17 51 2006 Houston Hobby 138 17 34 1971 Dallas (Love Field) 120 15 15 1971 Los Angeles (LAX) 109 11 21 1982 Oakland 106 13 19 1989 Orlando 102 12 33 1996 Source: Fact Sheet, 2011
  7. 7. Running head: SOUTHWEST AIRLINES PORTFOLIO 7 Southwest Airlines Fleet: Operational Lease vs. Ownership Currently Southwest Airlines has 574 active B737’s in their fleet (Table 2), with an average age of 11.7 years (Fact Sheet, 2011). The majority of these aircraft are owned by the company, with a small portion under operational lease contracts. Because of their focus on low- cost, Southwest Airlines has typically held larger margins than their competitors. This enables them to purchase aircraft as opposed to operational leasing. Southwest mangers realize the cost- savings of ownership, and according to an article on aircraft leasing published in The Economist, “in the long-term, buying is cheaper than renting” (Aircraft Leasing: Buy or Rent, 2012). Table 2 Southwest Airlines Fleet Matrix Aircraft Type Current Future Historic TotalActive Stored On Order Due To other Operator Stored Scrapped Written- Off Boeing 737 574 17 46 36 18 1 692 Boeing 737-200 45 12 5 62 Boeing 737-300 158 1 22 13 1 195 Boeing 737-500 23 2 25 Boeing 737-700 376 1 377 Boeing 737-800 17 16 33 Total 574 0 17 0 46 36 18 1 692 Source: Southwest Airlines Fleet Matrix, 2012
  8. 8. Running head: SOUTHWEST AIRLINES PORTFOLIO 8 The operational lease is typically used with start-up companies, due to the requirement for little or no down payment. Many legacy airlines lease their aircraft because leasing protects against obsolescence and airlines “typically have low margins” and cannot afford to pay cash for their fleet (Aircraft Finance, n.d.). Southwest Airlines’ most popular aircraft, the B737-700, costs approximately $70.9 million, making a fleet of aircraft a very large company expense (Table 3). Table 3 Jet Prices 737 Family 737-600 737-700 737-800 737-900ER 737 MAX 7 737 MAX 8 737 MAX 9 Cost* 59.4 70.9 84.4 89.6 77.7 95.2 101.7 Source: Boeing Commercial Airplanes, 2011 *$ in Millions Average Direct cost-savings excluded, there are additional company benefits to leasing aircraft. According to Kimmel, Weygandt & Kieso, “operating leases allow the lessee to account for the transaction as a rental, with neither an asset nor liability recorded” (2009). This is beneficial to the company because, “reporting lower assets improves the return on asset ratio…reporting fewer liabilities makes the company look less risky” (Kimmel, Weygandt & Kieso, 2009). For Southwest Airlines, owning their aircraft means a balance sheet that accurately depicts the state of the company, which is more appealing to potential investors.
  9. 9. Running head: SOUTHWEST AIRLINES PORTFOLIO 9 Scheduling Considerations Producing an airline schedule is a dynamic event that attempts to balance operations between equipment, facilities, crew, market and other factors present in each airline’s operational environment. The schedule is where efficiency is realized, and can either make or break the airline. The scheduling considerations of Southwest Airlines are streamlined by the selection of a single type of aircraft. Each aircraft can be substituted in any route, without major changes to personnel, maintenance, or ground support equipment. This is in stark contrast to legacy airlines, which use several types of aircraft with various maintenance schedules, and require multiple crews trained on each type. Additionally, with point-to-point service there are no system-wide delays such as those experienced in hub-and-spoke operations. Although scheduling is streamlined at Southwest Airlines, there are several locations which experience regular delays due to weather and other factors (Table 4). Because of the anticipated airport delays, additional time must be added to flights scheduled during these events. Southwest schedulers typically add ground time for expected weather delays, or schedule arrivals 30 minutes early to make an airport curfew. Accurate scheduling is vital to meet the maintenance requirements of the aircraft and rest requirements of the crew. Scheduling mistakes such as breaking an airport curfew are accompanied by hefty fines; others may result in reduced asset utilization for the company. A primary reason for Southwest Airlines’ success is the knowledge that the aircraft and the people who provide operational support are its most important assets. The realization that reductions in scheduling errors directly influence operating revenue keeps Southwest schedulers on their toes.
  10. 10. Running head: SOUTHWEST AIRLINES PORTFOLIO 10 Table 4 Anticipated Delays Affecting Scheduling, Southwest Airlines Location Type Delay Reason San Francisco Weather Morning Fog Burbank Weather High winds around mountains Philadelphia Other Congestion/Ship crossing area LaGuardia Other Congestion San Diego Weather Evening Fog Orange County Other Airport Curfew Source: Inside Southwest Airlines: Schedule Planning, 2009 Southwest Airlines Marketing Strategy Southwest Airlines has shown a profit for the last 39 consecutive years, a feat unmatched in the airline industry. Their pricing strategy is simple and effective, charge the lowest possible fare that still enables the airline to make a profit (YouSigma, 2008). While price is the major competitive variable for the airlines post-deregulation, the unique marketing application of product, price, promotion, and place distinguishes this airline from its competitors. The product of Southwest Airlines is air transportation with no extra services (Hubpages, 2010). While first class seats and meals aren’t available, they do add value to the product by providing excellent customer service, baggage handling, easier ticketing, flexible flight schedules, and easier check-in and check-out at the airport (Hubpages, 2010). At first glance the product may seem somewhat lacking, but with a high perceived value the customers keep coming back.
  11. 11. Running head: SOUTHWEST AIRLINES PORTFOLIO 11 Prior to introducing their product in a new place, Southwest Airlines does extensive research and launches a public relations and awareness campaign to establish a positive image in the minds of their customers (Hubpages, 2010). Upon entry into the market, they typically offer fares that undercut prevailing rates by 50%, quickly launching into a price war with the competing airline (Hubpages, 2010). With rapid expansion of existing flights, the “Southwest effect” takes over, causing airfares to go down and tourist traffic to increase (YouSigma, 2008). Southwest Airlines is able offer lower fares by continually finding ways to cut operating costs. They run ads which direct people to their website for the best online deals, offer ticketless travel, and skip paying booking fees by not using travel comparison websites such as (The Pricing Journal, 2011). The point-to-point system of operations produces greater on-time reliability, as a single aircraft delay in the hub-and-spoke system can result in a chain reaction which affects multiple connecting flights. By encouraging passengers to check bags with their “bags fly free” campaign, they are able to turn planes at the gate faster. Not linking with other carriers eliminates any disparity in luggage accommodation due to aircraft type, luggage tracking errors due to mismatched networks, and ensures more people are reunited with their luggage (Joiner, 2010). Greater on-time reliability means Southwest planes are able to spend more time in the air, which equates to more flights per day and more revenue for the company. Because they offer short-haul flights, Southwest Airlines not only competes with other airlines, but also with ground transportation. Current competition includes legacy airlines such as Delta and United, which went bankrupt and restructured their operations, and new low-cost copycats such as Jet Blue and AirTran (Stock: Southwest Airlines Company, 2012). Recently Southwest Airlines purchased AirTran Holdings, the parent company of AirTran Airways, for $1.4 Billion, which includes several international flights (The New York Times, 2010).
  12. 12. Running head: SOUTHWEST AIRLINES PORTFOLIO 12 Personnel While most companies put the customer first, Southwest Airlines has experienced great success in putting their employees first. The concept is to satisfy the employees, and they will satisfy the customers (Lin, 2008). The end result is a lower employee turn-over rate, which reduces time spent training, and contributes to a healthy bottom line. Additionally, keeping good employee relations also adds to the success of the company, as approximately 77% of Southwest Airlines is unionized (Southwest Airlines Co. Annual Report, 2008). Labor costs at Southwest are significantly lower than their competitors, mostly due to the ability of employees to accomplish cross-functional tasks (Braginsky, 2010). Unless specifically restricted by the requirement of a license, employees in one job can assist employees in other jobs. This allows for greater labor productivity, which translates to a more cohesive team and reduces labor costs. Asset Utilization According to an article published in USA Today, “the U.S. airline industry is undergoing a major alteration in the way the carriers compete” (Airline’s Swap Assets in New York, Washington, D.C., 2012). Legacy airlines are striking mutually beneficial deals for slot ownership, which has become a significant tradable asset for many airlines (Airline’s Swap Assets in New York, Washington, D.C., 2012). In trading slots, the airlines have the opportunity to restructure their operations and improve their asset utilization ratio. “The asset utilization ratio calculates the total revenue earned for every dollar of assets a company owns. This ratio indicates a company's efficiency in using its assets” (Southwest Airlines Asset Utilization, 2012). As of March, 2012, Southwest Airlines’ asset utilization is 0.8761 (Southwest Airlines Asset
  13. 13. Running head: SOUTHWEST AIRLINES PORTFOLIO 13 Utilization, 2012). In comparison to other low-cost carriers, such as Jet Blue (0.6683) and Ryanair (0.481), Southwest Airlines has optimal asset utilization (Southwest Airlines Asset Utilization, 2012). AirTran Acquisition: Additional Assets With the recent acquisition of AirTran Airways, Southwest Airlines has added 52 B737- 700’s to their fleet, along with 88 B717-200’s. However, because of the standardization enjoyed by a single type of aircraft, Southwest Airlines has decided to lease the all of the B717’s to Delta Airlines (Delta Plans to Lease 717s From Southwest, 2012). In addition to 140 aircraft, the 8,000 former employees of AirTran are also being integrated into Southwest Airlines (2011 Southwest Airlines One Report, 2011). The complete integration of personnel and aircraft is expected to take 2-3 years (2011 Southwest Airlines One Report, 2011). Because of the AirTran acquisition, Southwest Airlines now has entry into several new markets, including slots in Atlanta and New York LaGuardia, and access to near-leisure markets in the Caribbean and Mexico (2011 Southwest Airlines One Report, 2011). One major challenge with this acquisition will be converting AirTran’s hub-and-spoke operations into Southwest’s point-to-point service. International Operations Southwest Airlines acquired several international flights with the purchase of AirTran, and plans to establish international service from Houston’s Hobby Airport (Fly2Houston- Houston Airport System, 2012). Currently AirTran and Southwest operate under a single FAA operating certificate, but are still run as separate companies. With approval from the city of Houston, Southwest Airlines is taking full financial responsibility for the construction of an international terminal and immigration facility at Hobby (Seagraves, 2012). After construction is
  14. 14. Running head: SOUTHWEST AIRLINES PORTFOLIO 14 complete, the city of Houston will own the terminal, and Southwest will pay no rent for use of the facilities (Seagraves, 2012). Southwest Airlines also has plans to incorporate a travel-reservation system for its new international flights, as the reservation system for domestic flights won’t support international operations (CBS DFW, 2012). The travel-reservation system, from Amadeus IT Group, is scheduled go online in 2014, when AirTran’s international flights become integrated into Southwest (CBS DFW, 2012). The planned integration of services is expected to take 2-3 years, putting the launch of international flights around 2015. AirTran’s international flights include Aruba, Cancun, San Juan, and Montego Bay (Table 5). Table 5 AirTran Nonstop Flights Domestic U.S. Cities International Destinations Atlanta Aruba, Cancun, Nassau, Montego Bay, Punta Cana, San Juan Austin Cancun Baltimore/Washington, D.C. (BWI) Aruba, Bermuda, Cancun, Nassau, Montego Bay, San Juan Chicago Midway (MDW) Cancun* Ft. Lauderdale San Juan Denver Cancun Milwaukee Cancun Orange County Cabo San Lucas/Los Cabos, Mexico City Orlando Aruba, Montego Bay, San Juan San Antonio Cancun, Mexico City Tampa Bay San Juan Source: Southwest Airlines, 2012
  15. 15. Running head: SOUTHWEST AIRLINES PORTFOLIO 15 Cargo Management Southwest Airlines not only provides passenger services, they also run a very successful air cargo business. In 2009, revenue from air cargo totaled $118 Million (AfA Member Profile, 2010). Shipping to 83 destinations, Southwest offers three types of air cargo services: Next Flight Guaranteed, where the shipment is 100 percent guaranteed to be on the next available flight; Rush Priority Freight, where the shipment is guaranteed to be at its final airport destination within 24 hours from the time it is tendered; and Freight, where shipments move on the next flight with available space. (AfA Member Profile, 2010) Although air freight has been popular in recent years, ocean container freight has grown at twice the rate of air cargo, and domestic trucking has also seen an increase (Inbound Logistics, 2007). One factor that may contribute to the declining trend in air freight is “long-term price deflation”, which will create “challenge for these companies to continue using air freight on a planned basis” (Inbound Logistics, 2007). According to Matt Buckley, senior director of cargo, Southwest Air Cargo, “carriers that want to stay in business must invest in the resources to provide cargo customers high service levels” (Inbound Logistics, 2007). Southwest Air Cargo is no stranger to providing excellent service, and has been recognized with several prestigious awards over the years. In 2010, they took home Logistic Management’s Quest for Quality Award for the 14th consecutive year, with the highest scores of any airline (Southwest Cargo, 2010). Critical categories included: Ontime Performance, Value, Information Technology, Customer Service, and Equipment and Operations (Southwest Cargo, 2010). They were also awarded the Airforwarders Association’s “Domestic Air Carrier of the Year” award for 2010 and 2011 (Nuts About Southwest, 2011).
  16. 16. Running head: SOUTHWEST AIRLINES PORTFOLIO 16 Southwest Air Cargo has several opportunities to expand operations and improve their services. As a result of the AirTran acquisition, Southwest Air Cargo will begin servicing the Atlanta area, and has added a “26,000-square-foot cargo facility” in Atlanta’s north cargo complex (Hartsfield-Jackson Atlanta International Airport, 2012). Another new addition is the use of Descartes Air Messaging Service, which provides real-time shipping messages to their cargo customers (Descartes, 2011). Financial Status In 2011, Southwest Airlines had a net income of $178 million and total operating revenue of $15.7 billion (Fact Sheet, 2011). Operating 574 B737 jets, with service to 73 cities in 38 states, they are currently the largest U.S. carrier, based on domestic passengers boarded, as reported by the U.S. Department of Transportation (Fact Sheet, 2011). Over the last ten years, Southwest Airlines has experienced a steady increase in Revenue Passenger Miles (Table 6). The RPM for 2002 was 45 billion, with a Load Factor (LF) of 65.9% (Southwest Airlines, 2010). In comparison, the RPM for 2011 was 98 billion, with a LF of 80.9%, which reveals a drastic increase in operational efficiency (Fact Sheet, 2011). The strategic management decisions of the company’s leadership have consistently resulted in more efficient methods of operation. A prime example is hedging 70% of their fuel needs, as compared to the 20% hedging of their competitors (Pae, 2008). This strategy reduces the impact of fuel spikes that can undercut profit, and allows them advance notice in budgeting for a major operating expense. Additionally, Southwest only flies the B737, which reduces training and maintenance costs, and ensures they can always make aircraft substitutions when the situation dictates
  17. 17. Running head: SOUTHWEST AIRLINES PORTFOLIO 17 (Strategic Report for Southwest Airlines, 2006). With standardized aircraft, gate turn-around time is improved, and with only one set of procedures to master, the crew has greater opportunity to discover and implement time-saving techniques. Faster turn-around at the gate means more flights per day, and point-to-point service paired with the use of less congested airports contribute to increased profit (Enhancing Service at Southwest Airlines, 2009). First Quarter 2012 Financial results of the first quarter in 2012 show Southwest Airlines with a net loss of $18 million, which was a result of a $478 million increase in first quarter economic fuel costs, over the first quarter of 2011 (Southwest Airlines Reports First Quarter Results, 2012). As fuel hedging contracts expire, the operating costs of Southwest Airlines will rise, decreasing the profit margin enjoyed in previous years. However, according to CEO Gary Kelley, “Energy price increases continue to pressure costs, which only serve to reinforce our commitment to eliminate waste and maximize efficiency throughout our Company” (Southwest Airlines Reports First Quarter Results, 2012). Conclusion Southwest Airlines specializes in doing more with less, and this is the driving force behind the strength of their company. With a unique business model and innovative application of the marketing mix, Southwest Airlines has established a very successful marketing strategy that continues to usher in profits. This company is a prime example of using persistence, innovation, and appropriate risk taking for entrepreneurs world-wide. However, as fuel prices consistently rise, the business savvy leaders at Southwest will be tested in their ability to keep costs down.
  18. 18. Running head: SOUTHWEST AIRLINES PORTFOLIO 18 With a solid track record of successful operations, this company is a first look for investors. Because of their continued profits, many businesses have tried to model their operations after Southwest. However, the unique combination of leadership present in this company is rare, and without the right leadership, any comparable service looks like a cheap imitation.
  19. 19. Running head: SOUTHWEST AIRLINES PORTFOLIO 19 Table 6 Southwest Airlines Ten-Year Summary Source: Southwest Airlines, 2010
  20. 20. Running head: SOUTHWEST AIRLINES PORTFOLIO 20 Table 6 Southwest Airlines Ten-Year Summary Continued Source: Southwest Airlines, 2010
  21. 21. Running head: SOUTHWEST AIRLINES PORTFOLIO 21 References 2011 Southwest Airlines One Report. (2011). Retrieved from!/performance/2011-performance/AirTran AfA Member Profile. (2010). Cargo Savvy. Forward Magazine. Retrieved from Summer-2010.pdf Aircraft Finance. (n.d.). Retrieved from Aircraft Leasing: Buy or Rent. (2012). The Economist. Retrieved from Airline’s Swap Assets in New York, Washington, D.C. (2009). USA Today. Retrieved from Boeing Commercial Airplanes. (2011). Retrieved from Braginsky, D. (2010). Southwest Airlines: How is Southwest able to charge much less for tickets than competitors? Retrieved from Southwest-able-to-charge-much-less-for-tickets-than-competitors CBS DFW. (2012). Southwest Airlines Gets Help for International Flights. Retrieved from Chopra & Lisiak. (2006). Kellogg School of Management. Northwest University. Retrieved from, 7sept06.pdf
  22. 22. Running head: SOUTHWEST AIRLINES PORTFOLIO 22 Delta Plans to Lease 717s From Southwest. (2012). St. Louis Business Journal. Retrieved from from.html Descartes. (2011). Southwest Airlines Cargo and Descartes Raise the Bar on Customer Service with Real-Time Cargo Visibility. Retrieved from Drake, W. (1998). A Financial Analysis of Southwest Airlines Co. Retrieved from Enhancing Service at Southwest Airlines. (2009). Tuck School of Business at Dartmouth— Glassmeyer/McNamee Center for Digital Strategies. Retrieved from Fact Sheet. (2011). Retrieved from southwest/history/fact-sheet.html Fact Sheet. (2012). Southwest Airlines. Retrieved from Fly2Houston- Houston Airport System. (2012). Effort to Launch International Service at Houston’s Hobby Airport. Retrieved from Hartsfield-Jackson Atlanta International Airport. (2012). Hartsfield-Jackson Welcomes Southwest Airlines to Atlanta. Retrieved from http://www.atlanta-
  23. 23. Running head: SOUTHWEST AIRLINES PORTFOLIO 23 History of Southwest Airlines. (n.d.). Retrieved from Hubpages. (2010). “Aviation Marketing and Marketing Mix of Southwest Airlines.” Retrieved from Inbound Logistics. (2007). Air Cargo Navigates Uncertain Skies. Retrieved from Innovators: Herb Kelleher. (n.d.). Chasing the Sun. Retrieved from Inside Southwest Airlines: Schedule Planning. (2009). Retrieved from International Directory of Company Histories, (2005). Vol. 71. St. James Press. Retrieved from History.html Jaffe, C. (1991). Moving Fast by Standing Still: Herb Kelleher, Southwest Airlines. Retrieved from Joiner, E. (2010). “Pure Genius: Southwest Airlines Baggage Strategy.” Retrieved from strategy.html
  24. 24. Running head: SOUTHWEST AIRLINES PORTFOLIO 24 Kimmel, P., Weygandt, J., & Kieso, I. (2009). Accounting: Tools for Business Decision Making. John Wiley & Sons. 3rd Edition. Lin, J. (2008). Southwest Airlines Term Project. Retrieved from &ei=9NrlT5uuNKaW2gWL3JzbCQ&ved=0CBsQFjABOBQ&usg=AFQjCNG7mJ81tA Agh3ayh4fdSBftFNpimg Nuts About Southwest. (2011). Southwest Cargo Takes Top Honors for Excellence in Air Cargo Service. Retrieved from honors-excellence-air-cargo-service Pae, P. (2008, May). Hedge on Fuel Prices Pays Off. Los Angeles Times. Retrieved from Seagraves, S. (2012). Houston’s Hobby Airport Will Become an International Airport. Retrieved from airport/ Southwest Airlines. (2010). One Report. Retrieved from Southwest Airlines. (2012). International Travel. Retrieved from Southwest Airlines Asset Utilization. (2012). Retrieved from
  25. 25. Running head: SOUTHWEST AIRLINES PORTFOLIO 25 Southwest Airlines Co. Annual Report. (2008). Retrieved from Southwest Airlines Fleet Matrix. (2012). Retrieved from Southwest Airlines Reports First Quarter Results. (2012). LUV Investor Relations. Retrieved from Southwest Cargo. (2010). Southwest Airlines Earns 2010 Quest for Quality Award for 14th Consecutive Year. Retrieved from PressReleases-20101006.shtml Stock: Southwest Airlines Company. (2012). Retrieved from Strategic Report for Southwest Airlines. (2006). Pandora Group. Retrieved from The New York Times. (2010). Southwest, Determined to Expand, Buys AirTran. Retrieved from The Pricing Journal. (2011). “Southwest Airlines Pricing Strategy: Creating a Unique Value Proposition via Upfront Pricing.” Retrieved from fly-free-and-no-change-fees-has-created-a-unique-value-proposition/
  26. 26. Running head: SOUTHWEST AIRLINES PORTFOLIO 26 YouSigma. (2008). "Southwest Airlines Marketing Strategies." Retrieved from