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Dr. Gridlock
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Posted at 09:31 AM ET, 05/03/2011

Southwest, AirTran merger may mean lower fares — eventually

Southwest Airlines completed its purchase of AirTran Airways on Monday, becoming the Washington region’s dominant air carrier with about 32 percent of the area’s air travel.


(Ted S. Warren - AP)
The merger could mean lower fares for some Washington travelers, even as rising prices continue to affect the cost of air travel. The consolidation gives Southwest its first presence at Reagan National Airport, a location that it had sought for years, where AirTran controls about 4 percent of the traffic.

When it announced the merger, Southwest bragged about the “Southwest effect,” in which the carrier drives prices lower in the markets it enters.

For instance, before Southwest’s arrival in Minneapolis in 2009, three carriers offered round-trip Chicago-to-Minneapolis flights for about $400. Southwest undercut its competitors, offering $150 tickets, before the prices stabilized at about $200. The effect could be less in the Washington market since Southwest already has a presence at Dulles International and Baltimore-Washington International Marshall airports.

The combined airline will control about 65 percent of the flights at BWI. Southwest and AirTran employees at BWI celebrated with a party as the deal was completed Monday. Company officials said customers flying Tuesday are eligible to receive free wine, beer or a cocktail to help celebrate.

Southwest said that it plans to continue to operate the airlines as separate companies for now, with separate Web sites and policies. Full integration may not occur until 2012, when the company expects to receive a single operating certificate from the Federal Aviation Administration, and the airline will begin repainting the AirTran fleet with the Southwest colors. However it may take several years for full integration, Southwest said.

Southwest and AirTran announced the deal last fall.

By Washington Post Editors  |  09:31 AM ET, 05/03/2011

Categories:  Airports, Aviation

 
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