Acquisition of AirTran By Southwest Airlines

Acquisition of AirTran By Southwest Airlines

Southwest announced that it would buy AirTran Airways for $1.4 billion in September 2010. The acquisition would give AirTran more than thirty new markets and several tourist destinations in Mexico and the Caribbean. This deal strengthened southwest position in the southeast and on the east coast. Officially, Southwest became an international airline in July 2014 when it transitioned service operated by its subsidiary, AirTran, to its brand. The acquisition allowed southwest to take a low-risk approach to introducing its own branded flights to international destinations.

Currently, Southwest faces familiar competitors on many of its international routes, some of the major competitive forces being rivalry among sellers being moderately active (O’Brien, Jan 10, 1995). Airlines primarily compete on price and services; however to a lesser extent they compete on the frequency of flights, reliability, and frequent flyer programs. Recently, pressures have eased since well-established carriers have stayed within their geographical areas of dominance, concentrating more on profitability other than the expansion. The success of Southwest is widely attributed to the competitive advantages it has gained by effectively positioning the organization in customer’s minds mostly through employees branding. It clearly articulates its desired brand image to staff and clients.   At Southwest careful attention is paid to ensuring that the messages emanating from all organizational systems align with the company’s mission, values, and desired band image.

AirTran had a lower cost structure and integrating it into Southwest’s operations, and culture could prove otherwise challenging due to stiff competition otherwise, complicating the integration would be Southwest’s limited experience with acquisitions.  To limit this needed a viable integration communication marketing strategy. For example, the company established numerous industry standards thus accomplishing its enviable record by challenging acceptable norms and settling competitive thresholds for other Airlines to emulate. Southwest has never curtailed service due to union strikes, and no passenger has ever died because of safety accident. (H.Lancaster, 1991)

Southwest created a positively outrageous service to its customers who got surprised of their spirit. On the flight, magazines pictures of gourmet meals were offered for dinner on an evening flight. Flight attendants were encouraged to have fun, songs, jokes and humorous announcements were always communicated.  The spirit de corps was enhanced and found throughout the firm size enthusiasm, and extroverted personalities was an essential element in the employee screening. While Southwest Airlines’ entire business model is important, arguably its most valuable competitive advantage has been the broad focus on hiring the right people. Southwest prides itself on being a people-oriented airline that operates with friendly and approachable employees and team members. Per its business plan, they hire employees who embody the company’s brand messaging and who have a passion for helping customers. To ensure the right mix of team members, Southwest has stringent hiring practices and policies, unlike AirTran. (Labich, 1994).

Unlike AirTran, Southwest Airlines has one of the best rewards programs in the industry. It offers points for purchasing flights that customers can use to buy future flights. It’s also in partnership with Chase Bank and offers customers a Southwest credit card that allows them to accumulate points that they can redeem for future flights. Keeping the customer happy is a significant competitive edge for Southwest Airlines as well as motivating workers, promoting excellent customer service, and offering one of the lowest-priced solutions for air travel. (Labich, 1994).

For Southwest to expand its market in future, it should establish other strategic locations between the targeted markets as well as offer reliable services to customers so as to build a positive reputation and image amongst the customers.  Also, they should ensure that the airline workforce and its interaction with their clients uphold the company’s perception and image in the market.

As a company, Southwest needs to consider the marketing mix so as to meet customers’ needs. Using regular advertisements, ensuring good public relations, effective sales promotion all aimed at delivering a clear message and choosing the best development method provides an upper hand competitive advantage for customers. For example, for Southwest airline to prevail in the target markets, it needs to ensure that its workforce is motivated towards high-quality client services and provide intensive advertising of its services in the right channels.


  • H.Lancaster. (1991). Herb Kelleher Has One Main Strategy. Treat employees well, 31.
  • Labich, K. (1994). Is Herb Kelleher America’s Best CEO? Fortune, 45.
  • O’Brien, B. (Jan 10, 1995). Heavy Going. Continental CALite Hits Some Turbulence in Battling Southwest, A1, A16.