Southwest Airlines’ plans to grow in to the Hawaiian islands are no secret, but they’re also not the only destinations further afield the company is considering. In today’s annual meeting CEO Gary Kelly spoke briefly about some of those plans.
Our goal remains to be selling Hawaii flights by year end, with specific dates, flights and fares coming soon. Flying is subject to FAA approval and certification of ETOPS. That work is continuing and is on schedule. Hawaii expansion will be a major focus for Southwest in 2019 as far as our fleet growth is concerned.
The carrier flies to only 14 international destinations today and wants to see that number grow. To that end Kelly believes there are “as many as 50 additional opportunities to expand our route map in North American and parts of South America….It may take us 25 years but it is wonderful to have those opportunities to grow.”
Read More: Interisland service, mainland gateways announced for Southwest’s Hawaii service
Those were the only details included in the public webcast of the meeting but during a follow-on Q&A session with media Kelly got down into the details. The company has big plans ahead.
Adding Canadian destinations is a very real likelihood for Southwest, though it acknowledges this won’t come immediately.
.@SouthwestAir estimates it will need to fill half of any Canada flights with Canada point-of-sale passengers for them to be successful, will first require capabilities to market to Canada pax $LUV
— Ghim-Lay Yeo (@ghimlay) May 16, 2018
The carrier still needs to grow its market and brand awareness north of the border to generate sufficient local demand. It also needs to adapt its sales system to support foreign currency transactions. The latter should be easier on the Amadeus Altea PSS platform but it still takes some effort to make it happen.
Read More: Southwest readies a price war to Hawaii
Canada represents only a handful of the 50ish destinations the carrier is considering. Some Caribbean destinations could be added as US dollar sales though many other South America options would require the foreign currency sales solution.
No Oceans, though
With the 25-year horizon there’s a pretty good chance it is more than 50 destinations in total that the company might add. But, at least for now, crossing the Atlantic Ocean is not part of that plan. Kelly hinted at codeshare or other partnerships to feed traffic across the Pond but expects to steer clear of that market for now. Given the flood of LCC competition fighting for market share and Southwest’s nascent ETOPS program that’s probably a smart choice.
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Garrett Hartsuyker says
They don’t have a choice. US markets are saturated with fresh competition such as Spirit, price matching by majors, and 24 hour sales prior to departure.
For the SWA model to work, new destinations outside of CONUS are their salvation.
Seth Miller says
If Canada really is only a handful of the 50, though, then and Caribbean/South America is maybe 10-20ish more (and 20 is a high number for that range) then there are still 25-35 CONUS options they must be looking at. They’re only in 86 mainland destinations right now. I’m sure there’s some room to grow.
And it isn’t like the transborder market is lacking for competition. WestJet and Porter keep AC on its toes, plus the 3 US carriers running flights, too.
John Orman says
Mr. Kelly has been talking about 50 destinations since 2014. Additional leaders have echoed his words but emphasize they’re international destinations. In 2014, Mr. Kelly said that Southwest could add up to 50 destinations over the next 3-5 years with half the destinations be added in the first three years. We haven’t seen that yet. More importantly, Southwest is on track to have a total of 750 aircraft on property by the end of the year. That said, Southwest still does not have the equipment or staffing to add 50 destinations unless there is an acquisition on the horizon. My money is on Hawaiian or JetBlue.
Seth Miller says
Adding destinations does not necessarily mean lots of frequencies. And the carrier has nearly 300 737 MAX on order, which it can use to grow or replace older 737s on a case-by-case basis depending on the current market demands.
I also doubt an acquisition at this time.