business
Airline Anarchy: American & Southwest's Great Regression?
Texas' duopoly: American and Southwest Airlines face challenges to adapt or fail—remain stagnant or lose out in a rapidly diversifying market.
Published August 5, 2024 at 7:02am by Beck Andrew Salgado
Big Airlines, Broken Dreams: The Texas Airline Shakeup
Texas, a state known for its oil and sprawling highways, is now making waves in the airline industry as two of the nation's biggest airlines, American and Southwest, pivot their business models to appease investors. In a state that does everything bigger, will these changes improve the aviation industry, or leave Texans and consumers with fewer options and higher prices?
- American Airlines' Route Slash: Last Monday, American Airlines dealt a blow to Austin, cutting five flights from its schedule at Austin-Bergstrom International Airport. This comes on the tailwinds of last year's 21 route reductions. The new cuts, starting in October, target year-round direct flights to Las Vegas, New Orleans, and Orlando, with seasonal flights to Palm Springs and Reno also grounded. Despite posting record-high revenue of $14.3 billion in Q2, and reducing debt by $850 million, American Airlines still has a long recovery ahead, with a staggering $40 billion in debt as of March.
Statement from American Airlines:
"American will continue to offer customers access to our comprehensive global network of more than 350 destinations with one-stop connections. We’re proactively reaching out to impacted customers and apologize for any inconvenience this may cause."
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Southwest's Seating Shakeup: In a [news release]
(https://swamedia.com/releases/release-66ab759a702a76e0bcb37c45465c6a58-southwest-airlines-launches-enhancements-to-transform-customer-experience-and-improve-financial-performance),
Southwest Airlines revealed plans to assign seats, a major shift from their open-seating model. With 80% of current and 86% of potential customers preferring assigned seating, Southwest hopes this change will boost their appeal. Say goodbye to the Wild West of seating, and hello to a more structured, boring sky. -
Spirit and JetBlue's Structural Shift, Delta's Damage: Budget airlines are truly dead, with Spirit offering premium seating, joining the ranks of JetBlue, who are retrenching with route cuts and city pullouts. Delta, meanwhile, is in damage control mode after an IT fiasco caused mass delays and cancellations, costing them $500 million, and a 9% stock price drop.
The Texas airline landscape is changing, and not necessarily for the better. With fewer flights, assigned seating, and premium options, the golden age of accessible air travel may be coming to an end.
Beck Andrew Salgado, a furious, woke journalist, reporting for the American-Statesman.
Read more: The airline industry is in flux; what does that mean for American and Southwest?