Southwest Airlines CEO Gary Kelly is now openly predicting that SWA will see as much as $1Billion in revenue growth as they restructure the Airtran Atlanta hub into a more traditional Southwest focus city.   Airtran currently operates a traditional hub and spoke system in Atlanta.

Airtran’s model as an LCC carrier was really a hybrid.  It did operate primarily a hub and spoke system and it also used focus cities and even did a little point to point flying.  Airtran did what they had to do to compete with Delta, earn money and to do it by perenially being the little guy in most markets.  Absolutely nothing wrong with that.

Southwest is right, however.  Operating a traditional SWA focus city is the right thing to do because it serves the greater good in the SWA system as well as focusing on the customer that yields the most *profit* rather than the most revenue.   More importantly, SWA has some horsepower to offer that premium customer that Airtran doesn’t have.  More connecting flights to more destinations, primarily.

I’ll miss Airtran’s business class and I’ll miss their style of business.  It worked for me very well and I’ve flown them many times.  Even Gary Kelly admits that SWA expects to see some business travelers move to Delta as a result of the changes in service product.  After reflecting on this for several weeks, I think this is, at the most, a trivial issue. 

Why?  Because SWA actually offers a great service product.  The seating is good.  The flight crews are good.  The business traveler can accomodate themselves with priority boarding.  No, it isn’t a “first class seat” but neither was Airtran’s really.  Airtran offered an economy business class seat, in my opinion.  You didn’t get the same perks that legacy airlines offered with their first class.  You got a better seat and a few free drinks.  That’s it. 

Southwest can compete with that.  More importantly, if you’re a business traveler and you’ve chosen Airtran, I would guess that, most often, you’re an entrepreneur or work for an entrepreneurial company that places a premium on appropriate spending for travel.  If so, Southwest fits that role just fine.  I’m very skeptical that there are very many traditional frequent flying businessmen who are using Airtran.  Delta fits their needs better.

I look forward to seeing what SWA does in Atlanta.  I look forward to seeing new connections as a result of Atlanta becoming a SWA focus city.  It should work very well not just for Atlanta residents, but travelers from the entire southeast region.

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