SOUTHWEST AIRLINES

SWOT ANALYSIS
STRENGTHS
1. Low turnaround time South west airlines had a turnaround time of 15 minutes in
comparison with industry average of 45 minutes.
2. Positively outrageous service reached out to customer with their unique Southwest
spirit.
3. Esprit de corps There was a sense of intense team spirit and belonging in the company.
4. Leaders like Herb Kelleher inspired a sense of trust and loyalty.
5. Comprehensive training programme Initial training programme introduced employees to
the culture .Advanced training occurred at the University Of People Of Love Field in Dallas.
6. There structure was designed in a way to provide permanent low cost fare services.
7. Online Ticketing They were the first ones to introduce online booking system.
WEAKNESSES
1. Unlike competitors they did not provide too many extra facilities like hotel room and long
distance call for delayed customers
2. They did not have their own hubs which were essential during inclement weather, delayed
schedules and high air traffic.
3. No first class ticket was provided by them.
4. Increasing debt The debts of the company was very high.
5. Though their strategy for providing extra services in exchange for high cost was unique but
during the time of recession people didnt have extra money to spend. Instead they could
use this extra money to pay debts.
OPPORTUNITIES
1. Expansion opportunities South west was expanding to region like North East
2. As competitors were facing bankruptcy in early 2000 they could focus on gaining more
market share.
3. Mergers and Acquisition As they were relatively large there was a greater scope for M& A.
THREATS
1. Open Skies Treatment (2007) It opened market for European Airlines leading to increase in
competition.
2. Increase in fuel prices South West airlines fuel expenditure increased by approximately
180%.
3. Due to absence of hub and spoke system they could not resolve seasonal problems due to
inclement weather conditions.
4. US economy was facing economic downfall .Entire airline industry was facing difficulty.


ALTERNATIVES
1. Develop a competitive strategy for the domestic markets as they are doing good with a
scope for expansion in the north east and ensure better customer service and performance.
2. Ensure immunity from the industry threats by going global.

PLAN OF ACTION
Follow the strategy of improving the share and reputation in the domestic market. This could be
achieved in the following ways:
-Increase number of employees to cater to the need of the north east.
-Introduce new schemes and offers to create high entry barriers for new entrants to the
market.
-Provide specialised training for the more congested north eastern markets.
-Continue with existing policy of steady growth and not expanding cautiously.