Southwest Airlines Buys AirTran, Expands Routes

Southwest and AirTran Tie The Knot

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And the mergers go on.

As Continental and United work toward a seamless merger, today’s news that Southwest Airline will acquire competitor AirTran in effect continues to reduce airline choices for travelers, and continues to hold them hostage to the pricing and fee whims of fewer and fewer airlines.

Southwest, admittedly one of the few airlines not to burden passengers with fees and hidden costs, will pay 1.4 billion in a cash and stock purchase for the privilege of consolidating the two low-cost airlines and gaining access, for the first time, to international routes, Mexico and the Caribbean, where competitor low-cost airline, JetBlue has had a strong presence

Southwest will also gain access to key smaller markets and strengthen its hold on East Coast cities like Boston. But the plum acquisition, according to USA Today is Atlanta, the word’s busiest airport.

The airline will pick up AirTran’s hub there, but may opt to “dehub” the city because Southwest’s flying strategy does not rely on the typical hub and spoke system, rather it flies from point to point helping to keep costs down.

One good piece of news for consumers is Southwest’s decision to drop AirTran’s $20-25 baggage fees, making it clear that its policy of attracting customers by not charging fees will continue.

We’ll see.

Southwest, based in Dallas, carries more passengers than any other U.S. airline and, with the acquisition, will now operate from a 100 different airports carrying, according to Yahoo Finance 100 million passengers.

The airlines expect to blend their operations by 2010


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