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Essay / Southwest Airlines - 930
Southwest Airlines' strategy of focusing on short-haul passengers and offering fares as low as a third of those of its competitors has seen considerable growth over the past decade. The market share of the major city pairs in the Southwest program has reached 80-85%. Maintaining the world's largest fleet of 737s and using the point-to-point connection method rather than the hub-and-spoke connection method has allowed Southwest to provide its service to more people at a lower cost. By putting employees first, Southwest has found the key to success in the airline industry. A happy worker is more productive and a better service provider. Southwest will continue to reserve future growth by entering certain markets only after careful market research. Southwest Airlines has faced many barriers to entry due to fierce competition from other airlines in the industry. Although competition was fierce, Southwest Airlines managed to succeed by doing things differently. Their mission was to provide affordable air travel to those who would not normally fly. Unlike the rest of the airline industry, Southwest has maintained its profits while keeping its fares low. Southwest was unique in the industry in two respects. They focused on short-haul travelers and used a point-to-point air connection method. The short-haul traveler is the backbone that Southwest was built on. The short-haul airline market was large enough to allow Southwest to maintain profits for more than 30 consecutive years. Shorter flight times allowed more flights per day. With an industry average of one or two flights per day, Southwest stands out with an average of 10 to 12. Maximizing utilization and minimizing ground time were key to Southwest's profitability. If the short-haul passenger was the backbone of Southwest Airlines' success, then their 737s were the lifelines supporting it. By choosing the 737 as the aircraft for all of Southwest's flights, the company saved time and resources in training its employees. Crews could easily be replaced by each other thanks to the extensive training on the 737. Low costs and, therefore, low fares are a huge competitive advantage, when combined with a loyal workforce and high quality. A very unique culture was found at Southwest Airlines among all of its employees.