Low Fare, Point-to-Point Service

Southwest Airlines was a wholly intrastate car­rier before deregulation, having been founded in 1971. It had developed a no-frills approach to air carrier service that it brought to the interstate market after deregulation, gradually expanding in a deliberate and cautious way. It used just one type of aircraft, the Boeing 737, thereby greatly reducing its parts inventory requirements and the training of its airframe and powerplant people, as well as its pilots. Southwest chose secondary airports, like Uove Field in Dallas and Midway Airport in Chicago, where the turn-around time for its aircraft would be mini­mized. This practice avoided the congestion, the АТС delays, and the airport confusion that were becoming symptomatic of the hubs. South­west’s success moved it into the top 10 airlines in the United States during the 1990s, and it continued to expand its service into the east­ern United States market, opening up service to underserved or unserved airports. By 2012, Southwest had grown to be the third largest air carrier in the country as measured by passen­gers carried.6

As Southwest has grown, it has developed a “rolling hub” system instead of strictly point-to – point service. In practice, an appreciable number of Southwest passengers are being flown by way of connections (via LAS, LUV, and BWI, for example).

The success of Southwest caused new entrant airlines (increasingly known as “low cost carriers,” or LCCs) to imitate its model of low cost and no frills, thereby creating even more service to even more destinations. The legacy airlines also began, in self-defense, to imitate the model of Southwest by creating subsidiar­ies that provided the same kind of no-frills ser­vice and that used lower-paid crews operating a single type of airplane, just like Southwest. These subsidiaries have not met with any substantial success.