An efficient Business model

1. It seems as though the airline industry is in a perpetual state of crisis.
While virtually every major U.S. airline has declared bankruptcy in the
past 10 years,Southwest Airlines has remained solvent and has
consecutively generated a profit for the past 39 years.
How do they do it? Their mantra seems to be "keep it simple," having
mastered the art of cost-cutting,reports Seth Stevenson at Slate.
Here are some of the strategies employed to keep operating costs low:
Having one type of aircraft
Southwest's fleet is comprised of one type of aircraft: the Boeing 737.
“We only need to train our mechanics on one type of airplane.We only
need extra parts inventory for that one type of airplane. If we have to
swap a plane out at the last minute for maintenance, the fleet is totally
interchangeable," VP of ground operations Chris Wahlenmaier
told Slate.
Using a point-to-point routing system
Another cost-cutting tactic? Forgoing the popular hub-and-spoke model,
which can lead to delays in the event of inclement weather or scheduling
conflicts.
Instead, Southwest uses a point-to-point routing system; with this
strategy, passengers deplane the flight and, chances are, the aircraft will
turn around and fly back to its starting airport.
Putting a premium on customer service
Perhaps Southwest's real strategy for success lies in its customer service
practices. There's no first class, nor is there assigned seating, which

2. means no wait for your section to be called before you're allowed to
board.
At a time when many airlines are applying (often obscene) surcharges to
check bags, Southwest allows two pieces of checked luggage per ticket.
Another added perk? Your luggage will likely greet you on the other side,
as Southwest boasts a 99.6 percent completion rate on bags.
While Southwest remains the most consistently profitable of all U.S.
carriers, they still are not immune to the realities of today's economy.
According to USA Today, in April Southwest posted an adjusted first-
quarter loss of $18 million due to rising fuel costs.