The Company continued to replace its older aircraft with newer aircraft that are less maintenance intensive and more fuel efficient. This, in turn, has reduced the number of aircraft and gate facilities that would otherwise be required and allows for high Employee productivity (headcount per aircraft).ĭuring 2015, the Company continued to focus on reducing fuel consumption and improving efficiency through fleet modernization and other fuel initiatives. These conveniently located airports are typically less congested than other airlines’ hub airports, which has contributed to Southwest's ability to achieve high asset utilization because aircraft can be scheduled to minimize the amount of time they are on the ground. Southwest’s point-to-point route structure includes service to and from many secondary or downtown airports such as Dallas Love Field, Houston Hobby, Chicago Midway, Baltimore-Washington International, Burbank, Manchester, Oakland, San Jose, Providence, and Ft. Lauderdale-Hollywood. Southwest’s use of a single aircraft type has allowed for simplified scheduling, maintenance, flight operations, and training activities. The Company’s low-cost structure has historically been facilitated by Southwest’s use of a single aircraft type, the Boeing 737, its operationally efficient point-to-point route structure, and its highly productive Employees. Adjusted for stage length, the Company has lower unit costs, on average, than the majority of major domestic carriers. AirTran’s final passenger service occurred on December 28, 2014, and it has been integrated into Southwest.Ī key component of the Company’s business strategy has historically been its low-cost structure, which was designed to allow it to profitably charge low fares. During 2014, the Company also operated AirTran Airways (“AirTran”). For 2015, the Company’s average aircraft trip stage length was 750 miles, with an average duration of approximately 2.0 hours, as compared with an average aircraft trip stage length of 721 miles and an average duration of approximately 2.0 hours in 2014. This has enabled the Company to more economically serve long-haul routes, as well as high-demand, slot-controlled and gate-restricted airports, by adding seats for such routes without increasing the number of flights (a “slot” is the right of an air carrier, pursuant to regulations of the Federal Aviation Administration (“FAA”), to operate a takeoff or landing at a specific time at certain airports). During 2015, the Company continued to incorporate the Boeing 737-800 into its fleet, which offers significantly more Customer seating capacity than Southwest’s other aircraft.
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