Posted on: September 30 2010Southwest and AirTran changes are inevitable, but will hopefully be few.
Sep 29, 9:49 AM EDT
By SAMANTHA BOMKAMP and DAVID KOENIG
AP Airlines Writers
Southwest Airlines agreed to buy AirTran this week for $1.4 billion. When the combination is complete, fliers - especially those used to AirTran - will notice plenty of changes, from the way they book to the way they board.
Here's a look at four ways air travel may change when Southwest and AirTran get together, which could take until 2012:
- FARES. The "Southwest effect" is so well-documented that even the government cites it now: When Southwest enters a new market, fares fall, often steeply.
Travelers in Atlanta, at least, should see lower fares to places where Southwest flies but AirTran does not, such as Cleveland, Louisville and Little Rock.
But the impact on fares in other places is less clear. For one thing, Southwest is taking over in markets already served by another discount carrier. For another, less competition generally makes for higher prices.
Without AirTran, "The airlines don't have that excuse anymore of, 'Well, the other kids are doing it.' There's one less kid," said George Hobica, the founder of airfarewatchdog.com.
On the other hand, expanding allows Southwest to offer fare sales that are more national in scope, said Tom Parsons, CEO of Bestfares.com. It will serve more than 100 cities instead of 69.
- SMALLER MARKETS. Southwest gains access to 37 new airports - the kind of markets that it had never considered or deemed too small too bother with. Places like Dayton, Ohio; Bloomington, Ill.; and Allentown, Pa.
Southwest CEO Gary Kelly said in an interview that the airline assumes "we'll keep all of them," although he noted that when Southwest bought a low-fare carrier called Morris Air in 1993, it dropped some smaller destinations.
Mike Boyd, an aviation consultant who was hired by Southwest's pilots this year to study the effect of different Southwest merger scenarios, said the airline will drop very few AirTran locations no matter their size.
"Those markets all make money, and Southwest will fly wherever they can make money, whether it's Jackson, Miss., or Los Angeles," Boyd said.
About the only AirTran market that Boyd considers likely to be dropped is Branson, Mo., where the privately operated airport has struggled with weak traffic. Others will emerge stronger with Southwest service - Bloomington will lure passengers away from Champaign and Springfield, Ill., he predicted.
- CHANGES FOR SOUTHWEST PASSENGERS. They'll be able to earn and redeem frequent-flier points for trips to Southwest's new destinations.
Southwest officials say the customer experience at the airport and on the plane won't change much. There will be no assigned seats, no change in the boarding process - passengers line up and grab any available seat - and no business- or first-class cabins.
And Southwest isn't likely to make tickets more widely available on the Internet. It sells most of its seats on Southwest.com without farming sales out to sites like Orbitz and Expedia.
"We've been absolutely protective of our brand, and a big piece of our brand is Southwest.com," said Bob Jordan, Southwest's executive vice president of strategy and planning. But he left a little wiggle room, saying Southwest must be open to learning from AirTran's ways - one of which is selling tickets on many websites.
Southwest is currently overhauling its Rapid Rewards frequent-flier program and promises to unveil changes next year. Jordan said those changes won't be influenced by the addition of AirTran. He wouldn't say if Southwest will continue to base rewards on the number of trips, or switch to miles flown like most other airlines.
- CHANGES FOR AIRTRAN CUSTOMERS. They get access to many new destinations because AirTran serves only about half of Southwest's 69 cities. For AirTran passengers, the deal opens up some of the West, including Salt Lake City, Albuquerque, N.M.; and Portland, Ore. They can choose among four airports in the Los Angeles area and three around San Francisco instead of one apiece.
Their biggest break may be on fees. Southwest officials say they plan to drop AirTran's charges for checked bags. Right now, two bags cost $45. Southwest also doesn't charge a fee for itinerary changes, while AirTran charges $75. Southwest says it plans to drop the fee on AirTran.