Southwest Airlines Co. (LUV) and AirTran Airways moved a step closer to being a single carrier by fully interconnecting their networks. However, for the time being, AirTran will continue to operate under its own name as a subsidiary of Southwest. With the new integrated services slated to start from Apr 14, flight bookings are available on sales counters of the carriers, various travel agencies and other related websites.
The process of merging the itineraries of the two airlines started in Jan, this year, almost two years after the AirTran acquisition closed. The companies initially offered a small number of interlinked routes in just five markets. The very next month, the companies expanded its chain of connected networks to another 39 cities.
Following this major step, travelers can now book flights on any route, including international, served by both Southwest and AirTran, in a single transaction. Via the combined network, jet-setters will be able to reach to more destinations faster, at a lower cost. The customers will also earn points on loyalty programs, irrespective of the airline they choose to fly.
Ever since Southwest closed the acquisition of AirTran in May 2011, the former is focused on conducting a smooth integration process that will likely be completed by 2014 end. Till date, Southwest has successfully converted 11 AirTran 737 – 700s aircraft into its livery and brought in 30% of the AirTran workforce under its wings. Southwest also took over five AirTran Airways-served cities within its operational boundaries. On the financial front, Southwest realized net, annualized, pre-tax synergies of $142 million in 2012 and the transaction is expected to generate net synergies of nearly $400 million by year-end 2013.
Dallas, Texas headquartered Southwest along with AirTran operated 694 aircraft by The Boeing Company (BA) serving 97 cities in 41 states, as of Dec 31, 2012. The company – which operates along with other prominent players such as United Continental Holdings (UAL) and JetBlue Airways (JBLU) – currently holds a Zacks Rank #3, implying a Hold rating.
BOEING CO (BA): Free Stock Analysis Report
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