Much of the fuss following Southwest's acquisition has focused, understandably, on the buyer. After all, the deal is a big one for Southwest, which will expand considerably both in size and reach. But lost in all the predictions about routes and fares and Southwest's impending head-to-head battle with Delta in Atlanta is the fact that AirTran, which will be absorbed into the Southwest brand, is no slouch, either.
You may recall that AirTran took home the title of Best Value Airline this year in our annual Editors' Choice Awards. Here's what we had to say:
AirTran has delivered a steady stream of value-oriented promotions in 2010, quietly becoming a pace-setter whose prices force other air providers to match or risk being passed over by budget-conscious consumers. Also worth noting is the travel window—or period of time during which a traveler can fly on a given airline's lowest prices—that AirTran makes available in its frequent sales. The window is consistently longer with AirTran than with virtually all of its competitors. In early spring this year, AirTran was already discounting flights into November.
To get a sense of what AirTran's disappearance could mean for consumers, I talked to our own airfare editor, Patricia Magana. Magana is the brains behind all our airfare deals, and monitors fare sales and trends as closely as anyone. She noted that AirTran's sales are typically "among the lowest priced, if not the cheapest," and said "many of the legacy carriers (American, Continental, Delta, US Airways) take their cue from AirTran and match the low-cost carrier's prices and travel restrictions almost immediately after AirTran posts its deals."
With AirTran out of the picture, she says, "Southwest will have free reign to more easily set airfare pricing."
For Southwest, that's what this deal is all about: pricing power. With one fewer low-cost carrier in the game, Southwest will mostly compete against legacy lines, and that's a match-up Southwest, with its much lower costs, will take any day.
But doesn't this scenario open the door for Southwest to charge a little more—or, more accurately, discount a little less? Sure, Magana says, though that's not exactly the airline's style. Still, "there’s little doubt Southwest’s fare-pricing formula will change now that it will be adding more destinations to its route map," she says, "especially on those international cities it's picking up from AirTran."
Business travelers, too, may find themselves longing for AirTran's return. Reader definer summed up the problem Southwest faces: "As a nearly dedicated AirTran customer over the last 10 years, I doubt I'll fly the merged airline. As a frequent business traveler, I like an assigned seat. I also like the option of upgrading to the space of business class when I can. If Southwest continues its 'cattle call' mentality with the new airline, I, along with a number of business customers, will take my business elsewhere."
This is nothing new to Southwest, which offers a handful of perks geared toward business travelers, but none of the comfort or amenities available from legacy lines. Southwest said it has no plans to incorporate AirTran's business-class seating or seat selection. This certainly runs the risk of alienating business travelers accustomed to AirTran's affordable business-class upgrades, and may hamper Southwest's ability to crack Delta's business travel market in Atlanta. We'll see.
So while consumers may be cheering the sudden, significant expansion of Southwest, it does come at the expense of an airline that did a lot of things right (like being the first airline to install fleetwide Wi-Fi) and played an important role in the budget travel landscape. Maybe you won't lament the loss of AirTran's bizarre color scheme, but don't be shocked if you miss AirTran more than you expect.