Launch of international flights
The launch of international operations is a new milestone for Southwest Airlines. The acquisition of AirTran Airways, which operated internationally, made the new services possible.
Southwest’s first five international routes were launched this year. Flights to Oranjestad, Aruba, Nassau and Paradise Island in the Bahamas, and Montego Bay, Jamaica were launched on July 1, 2014. Flights to San Jose del Cabo and Cancun, Mexico started in August, as scheduled. Previously, these markets were served by AirTran.
Apart from these, Southwest plans to take over the existing AirTran services to Mexico City and Punta Cana by November. It also announced in September that it’s launching a daily nonstop service to Central America. The new route between Baltimore, Washington and San Jose, Costa Rica, beginning in March 2015, is expected to add connecting service to 17 more cities in the U.S. In sum, Southwest announced that it’s on track to complete the AirTran integration by the end of the year as planned.
Expansion at the Ronald Reagan Washington National Airport
Southwest is adding new nonstop services at the Ronald Reagan Washington National Airport that are scheduled to start in November. It’s expected that the 27 additional daily roundtrip flights—added after Southwest acquired 54 slots at the airport—will increase daily departures from 17 to 44 by the end of the year and double the number of destinations served to 14. The 54 slots were divested when American Airlines merged with U.S. Airways in December 2013. For more on this topic, read Why the American-US Airways merger was conditional.
End of the Wright Amendment
Southwest plans to add new nonstop routes starting in October at Dallas Love Field airport, following the repeal of the Wright Amendment. In the next part of this series, we’ll learn how Southwest will be affected by this development.
Transportation funds including the iShares Dow Jones Transportation Average ETF (IYT) and the SPDR Series Trust ETF (XTN) hold stocks of top airlines including Delta Air Lines, Inc. (DAL), United Continental Holdings Inc (UAL), American Airlines Group Inc. (AAL), Southwest Airlines Co. (LUV), and JetBlue Airways Corporation (JBLU).