Topic > The Story of Southwest Airlines - 637

Southwest's story reflects the tenacity of its CEO. Kelleher had a law firm in San Antonio when a client suggested starting a discount airline to connect three Texas cities. After five years of legal battles over competitor objections, Southwest finally took off in 1971. To keep airfares low, the start-up avoided extras like meal service and got planes in and out of the gate in twenty minutes or less. . The airline now serves dozens of cities across the United States using the original formula of low prices, low costs and high productivity to keep profits high. In fact, Southwest's operating margins are now three times higher than the industry average. What is particularly impressive about Southwest Airlines is that the company has been consistently profitable every year since 1973. This is primarily due to its constant pursuit of low operating costs, low fares, and satisfactory customer service. Additionally, Southwest consistently leads the entire airline industry with the lowest ratio of complaints per boarded passenger. The company started from the bottom and worked its way up through the industry ranks to become a major competitive force in the domestic segment of the U.S. airline industry. The company has managed to weather industry downturns, dramatic increases in jet fuel prices, drops in air traffic due to terrorist attacks and recessions, while other airlines are in debt or have gone bankrupt. Furthermore, not only did they manage to overcome these threats, but they continued to add more and more flights at more and more airports. The primary reason for their continued success appears to be due to their low-cost model and strong emphasis on employee and customer satisfaction.......middle of paper......served by existing carriers and which The Southwestern cities proposed to enter could not support a new carrier. It took seven months for Southwest's appeal to reach the state's court of civil appeals. In a two-to-one decision against Southwest, the intermediate appeals court upheld the lower court's ruling. Kelleher then argued Southwest's case before the Texas Supreme Court, which overturned the lower appeals court's decision and Southwest would be granted its certificate to fly. But the fight wasn't over. Braniff, Texas International and Continental appealed to the U.S. Supreme Court. In late 1970, the Court refused to hear the appeal and Southwest won a landslide victory, but in the years that followed it faced repeated lawsuits, some of which reached all the way to the U.S. Supreme Court. working for Southwest Airlines as CEO