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Unformatted text preview: 2-28-2008Southwest AirlinesI.Backgrounda.Herb Kelleheri.Was sitting in a bar and drew a map of Texas. (Houston, San Antonio, Dallas)ii.Wanted to have an airline that was so cheap that it would cost less to fly than to travel by automobile.b.Highly expanded once they were deregulatedi.Had 3 in 1971, 13 in ‘78, 162 in ’94, 350 in ’01, 440 ‘07I I.Operationa.Low costs i.Don’t go through travel agentsii.Use primarily secondary airports: ex. San Jose, Oakland. Not SFO1.I t is a lot cheaper to run in secondary airports.2.There are a lot less traffic in secondary airportsiii. Only Fly 737 airplanes1.Maintenance costs – one type of mechanic, parts inventory2.Pilot training – only need one type of pilot for all flights3.Economies of scale – buy more of the same plane and you get a better price. Boeing gives them deals for being loyaliv. Don’t serve food because flights are so shortv.Record turnaround – how much time it takes from touchdown to take off again1.Land, clean bathrooms, unload and load people...
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This note was uploaded on 09/08/2010 for the course BUS 160 at San Jose State.