UPDATE: Southwest’s Acquisition of AirTran – What it Means
In a news conference this morning, executives at Southwest said they were “very excited” over the Southwest takeover of AirTran because it will mean “more low fares to more customers”. And Forbes is reporting that Wall St. traders are “loving the deal”.
What Won’t Change
And, at least for now, Southwest’s reputation for low or no fees will remain intact. According to Southwest, there are currently “no plans” to change its policies of open seating, one class service, and two free bags.
Southwest also said it has no plans to switch from its home airport – Dallas’ Love Field – to DFW, it’s larger neighbor down the road – even though that’s the airport used by AirTran.
Airline brass described their carriers as having similar employee/customer-centric philosophies: “Both have good people who care about each other and serving customers”.
What Will Change
AirTran’s corporate headquarters is in Orlando, but this will be integrated into Southwest’s Dallas headquarters.
Changes for Passengers
The deal will open up some new routes for Southwest and passengers in these cities and regions will see some changes:
Will Bags Fly Free when Southwest Moves Into:
Boston: With few overlapping routes, Boston is a coup for Southwest
Dallas: Find out – Will Southwest fans fly from DFW?
Washington, DC: Southwest’s acquisition of AirTran is certainly a smart move
New York: A growing footprint, Southwests adds more LaGuardia slots
Past Southwest Acquisitions
This is what Southwest calls its “most ambitious” acquisition yet. There have been two others:
- 1985 – Southwest purchased Muse Air
- 1993 – Southwest acquired Morris Air
EARLIER: If you were wondering about Southwest’s possible plans for expansion, wonder no more.
Big Big News
According to an email sent out to its miles members, Southwest Airlines has entered into a “definitive agreement” to acquire low-cost carrier AirTran – and CNN pegs the cost of the airline takeover at $1.4 billion.
The deal has already been approved by the boards of directors of both airlines.
What’s in it for Passengers?
Gary Kelly, the CEO of Southwest, wrote that: “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.” (UPDATE: This will put the carrier in head-to-head competition with Delta Air Lines).
What’s Next for Southwest Takeover of AirTran
What’s next? The deal is now contingent upon the approval of regulators – and approval by AirTran stockholders.
Eventually, the AirTran brand will disappear as it is integrated into Southwest – and the frequent flier miles clubs will be combined – but the details are still being worked out, and for the moment, both carriers will be operating as they normally would. Southwest is setting up a website where they will update developments on this new airline takeover, and you can follow along.