Southwest Buys Airtran

[PercyPug]

I just read on the Atlanta Journal Constitutional website (ajc.com) that SW bought AirTran!! I hope that means SW will be flying out of Atlanta's airport! YIPEE!!

[Niecyboo]

NEW YORK – Southwest Airlines said Monday it will buy AirTran for about $1.42 billion. The move will put Southwest in head-to-head competition with Delta Air Lines in Delta's home base of Atlanta.

Southwest's acquisition of AirTran is expected to close in the first half of next year. It requires both regulatory and shareholder approval. The airlines expect to fully blend their operations in 2012.

[Fangorn]

Here's the note I received from Southwest on this:

____________________________
As one of our most valued Customers, I wanted you to be among the first to know the exciting news that Southwest Airlines has entered into a definitive agreement to acquire AirTran Holdings, Inc., a parent company of AirTran Airways (AirTran). Although the closing of the deal depends on a number of approvals, we're all very excited about what it can mean for the Customers, Employees, Communities, and Shareholders of both organizations.
If approved, the acquisition will allow Southwest to offer low fares and exceptional Customer Service in more markets and to more loyal Customers like you.

More Access to More Destinations
Our new, broader national presence will benefit many markets as a result of increased competition stimulated by Southwest's low fares and well-known brand. This includes significant opportunities to and from Atlanta, the largest domestic market we do not serve. It expands our presence in key markets, like New York LaGuardia, Boston Logan, and Baltimore/Washington, as well as enables us to serve Washington D.C. via Ronald Reagan National Airport. Also, it presents the opportunity to provide access to key international leisure markets in the Caribbean and Mexico, and extend our service to many smaller domestic cities that we don't serve today.

What Changes Today?
There are no changes to the way you travel on Southwest today or in the near future. Until the transaction closes and we've received the required regulatory and AirTran Stockholder approvals, Southwest and AirTran will continue to operate as independent companies. After closing, Southwest plans, over time, to integrate AirTran into the Southwest Airlines brand to develop a consistent Customer Experience.
This, of course, includes combining the carriers' frequent flyer programs. Meanwhile, credits and awards in both programs remain valid, and you will continue to earn credits by flying or using our partners just as you do today.
There's a lot of work to be done and decisions to be made. We'll keep you informed of developments. In the meantime, we invite you to visit a special website we've created – www.lowfaresfarther.com – where you'll find regularly updated news and information about the deal.
Thanks for your continued loyalty and support of Southwest Airlines!

Sincerely,
Kevin Krone
Vice President Marketing, Sales, and Distribution
______________________________________

Steve

[MNNHFLTX]

Interesting. I have a nephew-in-law that is a pilot for Airtran. I know they were in contract negotiations, so I wonder how this transaction will affect that.

[Ed]

This is HUGE news for Orlando. Southwest is already the largest carrier at MCO, having surpassed Delta a few years ago. Add in AirTran and they are virtually unbeatable.

Lots of questions are already coming up about policy changes. Most are answered at the special website set up by SWA.

In a nutshell, a few highlights ~

• SWA's no-fees-for-first-two-checked-bags policy will continue
• "Open Seating" will be the norm; AirTran's Business Class and Coach will convert to the SWA model, and AirTran's aircraft will be converted to the SWA seating arrangement
• No change fees; AirTran presently charges $75 for changes after booking
• Frequent Flyer programs will merge into SWA's Rapid Rewards program

Lots more info to come, I'm sure.

[BigRedDad]

Hopefully SWA corrects the issues with AirTran changing flight times. I am sure there will be a team of number crunchers with access to massive servers to calculate the most viable routes and have standard schedules for their largest routes. In my area, SWA flies to Orlando at the same times every day. It is a set route and nothing ever changes (except standard delays that can happen any where). They never cancel a flight due to low booking or anything else.

The quicker this deal closes the better it is for AirTran. Once they are assimilated into SWA, it will be that much better.

[Carolanne]

Southwest's acquisition of AirTran is expected to close in the first half of next year. It requires both regulatory and shareholder approval. The airlines expect to fully blend their operations in 2012.

So, my November AirTran flight should be ok, right?

[Ed]

So, my November AirTran flight should be ok, right?

Absolutely.

[Tink1]

The quicker this deal closes the better it is for AirTran. Once they are assimilated into SWA, it will be that much better.

Maybe, maybe not.

In markets where Airtran and SW compete, we may see a raise in prices since the other low cost carrier will no longer exist. (PHL is a market that comes to mind since I am in PA.)

Competition is not always a bad thing.

Nanc

[Hammer]

Maybe, maybe not.

In markets where Airtran and SW compete, we may see a raise in prices since the other low cost carrier will no longer exist. (PHL is a market that comes to mind since I am in PA.)

Competition is not always a bad thing.

Nanc

But Nanc, Air tran has been decreasing its flights out of PHL for a while now. They did away with the 1 nonstop to TPA ages ago and I think they only have 1 or 2 non-stops to MCO now. Price wise, they have been about the same (except you pay for bags on Air Tran).

[Stu29573]

I'm a little concerned. We fly out of Dallas and Southwest is always quite a bit higher than Airtran. Actually, we would prefer to fly Southwest due to airport issues (Love Field vs DFW) but we can never get a good deal. I'm "wait and see" on this one...

[Tink1]

But Nanc, Air tran has been decreasing its flights out of PHL for a while now. They did away with the 1 nonstop to TPA ages ago and I think they only have 1 or 2 non-stops to MCO now. Price wise, they have been about the same (except you pay for bags on Air Tran).

I usually fly AirTran from ABE, could not get decent rates from there in Nov so am going to PHL. Air Tran was much cheaper than SW even taking the bag fee into effect (but I will use rewards to go business class so that point will be moot)

While in a perfect world I see this as a good thing, and hope SW comes to ABE, I just have reservations about it.

Markets serviced by NW and Delta saw a marked increase in pricing due to their merger, and I will be interested in seeing what effect the United/Continental merger will have on some of their markets. Historically, mergers are not usually the best thing for the consumer.

I am just one who hates to see competition go away. If there is no competition, what is the driving force?


(edited to add: I am so used to connecting flights from AVP (Scranton) that direct flights do not factor into my equations no matter what airport.)


Nanc

[TiggeRia]

I usually fly AirTran from ABE, could not get decent rates from there in Nov so am going to PHL. Air Tran was much cheaper than SW even taking the bag fee into effect (but I will use rewards to go business class so that point will be moot)

While in a perfect world I see this as a good thing, and hope SW comes to ABE, I just have reservations about it.

Markets serviced by NW and Delta saw a marked increase in pricing due to their merger, and I will be interested in seeing what effect the United/Continental merger will have on some of their markets. Historically, mergers are not usually the best thing for the consumer.

I am just one who hates to see competition go away. If there is no competition, what is the driving force?


(edited to add: I am so used to connecting flights from AVP (Scranton) that direct flights do not factor into my equations no matter what airport.)

Nanc,
I, too, try to fly AirTran out of ABE. For me their prices have been unbeatable-most recently $54 each way to MCO. I can usualy get cheaper flights out of there than Newark (where neither carrier flies) or Philadelphia. I hope that SW will continue to fly out of ABE--there is certainly the market for it and all the flights I have been on have been packed. I'm hoping all in all that this is a good thing, though.
~Ria

[BigRedDad]

I don't think SW will eliminate AirTran routes at all. I think they will consolidate and create more efficient schedules. What I mean by this is if SWA and AirTran have flights from Airport A to Airport B, they will make a consolidated route. Instead of having 5 SWA flights and 6 AirTran flights, they have say 7 total flights for the route.

Competition is a good thing. However, SWA is not in business to charge high air fare. If they do this, especially after taking over, they are going to face major customer backlash.

[Mousemates]

Should be a good thing for those of us flying to Orlando out of East Tennessee...we will still have Allegiant to provide low-cost competition and will gain the added competitive advantage of a Southwest (taking over the Air Tran routes) to keep Delta and United in check. My only concern is if Southwest will keep the direct flight open or if it will require us to layover in Atlanta for a connecting flight.

[seanyred]

Living near Chicago I always had the option of using both airlines but would often use AirTran because of their fares being cheaper. I just hope I don't see a huge increase in cost to fly.

On a side note: Does Southwest Already work with Magical Express? Meaning do they have the ability to check in at the resort when departing?

[Tink1]

I don't think SW will eliminate AirTran routes at all. I think they will consolidate and create more efficient schedules. What I mean by this is if SWA and AirTran have flights from Airport A to Airport B, they will make a consolidated route. Instead of having 5 SWA flights and 6 AirTran flights, they have say 7 total flights for the route.

Competition is a good thing. However, SWA is not in business to charge high air fare. If they do this, especially after taking over, they are going to face major customer backlash.

I would highly doubt SW will keep all the smaller airports, I hope I am wrong though.

My most interesting notes on the conference call this morning:

Laura Wright - Airtran serves 37 cities that SW "could" provide service to. (this is the one that makes me worry about the small airports within easy distance of the larger ones)

Gary Kelly - SW will not serve DFW after this acquisition.

Nanc

[Tink1]

Nanc,
I, too, try to fly AirTran out of ABE. For me their prices have been unbeatable-most recently $54 each way to MCO. I can usualy get cheaper flights out of there than Newark (where neither carrier flies) or Philadelphia. I hope that SW will continue to fly out of ABE--there is certainly the market for it and all the flights I have been on have been packed. I'm hoping all in all that this is a good thing, though.
~Ria

me too! In ABE Airtran has so few flights and they contract out their ground crew. That does not fit into the SW model at all.

November was a freak thing rate wise, since normally I get fantastic air from there. They were just 2 high priced days I have to fly and had no leeway. It was something like $300 round trip. I am now driving further down "the pike" and flying out of PHL on Airtran.

I do not mind the drive down, it is that drive back that kills me. The NE extension is boring and I take it to the end then hop on 81N to get home.

Would love to see a low cost carrier up in this corner of the state!

nanc

[faline]

On a side note: Does Southwest Already work with Magical Express? Meaning do they have the ability to check in at the resort when departing?

At most resorts, yes.

[PinKy]

Yikes - this is not great news for us. The last time we flew SW we had to stand in line with an infant for 45 minutes just to get on the plane due to their "open seating" policy - we never flew them again. Now - we fly Air Tran regularly b/c they are very child/family friendly and we have 3 children. Does anyone know if they still have that 'first come first served' policy for seating? It really was chaos when we did that and I just don't think we could manage it with 3 + stroller/car seats, etc. We would be so sad to give up the Air Tran schedule and extra leg room - also big hits with our family.