The company sells seats on a one-way basis. Fares are set on the basis of demand for particular flights and by reference to the period remaining to the date of departure of the flights. Higher fares are charged on flights with higher levels of demand made nearer to the date of departure.
The company provides various ancillary services and engages in other activities connected with its core air passenger service. These include non-flight scheduled services, the in-flight sale of beverages, food and merchandise and Internet-related services. As part of its non-flight scheduled and Internet-related services, the company distributes accommodation services and travel insurance through both its website and its telephone reservation offices. Southwest also sells bus and rail tickets onboard its aircraft and through its website.
Southwest Airlines was established in 1971 in Texas with three Boeing 737 planes and routes between Dallas, Houston and San Antonio. The company's business model was simply: "If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline." (Southwest Airlines Co., 2010)
Rollin King and Herb Kelleher decided to start an airline that is distinct and unique in terms of services and fare. ...