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Southwest Airlines Co. Message Board

  • wallstreet_jim wallstreet_jim Jul 28, 2011 10:42 PM Flag

    SWA frequent flyer not feeling the "LUV"

    First, my background. I am a frequent flyer who spends over $100K per year on travel, split between SWA and Continental. Under the old SWA system, I routinely hit 100 points a year or more.

    With that out of the way, I have to tell you I am FED UP with air travel, and now SWA is on my *hit list. I have a bunch of the old A/B reward tickets that I might as well flush down the toilet. It is next to impossible to cash them in. I am very unhappy about this.

    When this airline was under Herb, it was magnificent. I loved flying SWA. When Colleen took over, it was OK, but towards the end of her tenure things began to slide. Now under Gary, I have to tell you, it has become a less than desirable experience for this traveler.

    Bottom line: I've given up on business travel. A few weeks ago I accepted a new position that all but eliminates air travel. I am not alone. There are thousands like me that are "checking out" and curtailing or eliminating business traveler. Before you bash me - consider this:

    * Business travelers are the bulk of an airline's profits
    * It takes several regular travelers (somewhere I read it's around 40 to 50) to equal the revenue stream generated by ONE business traveler

    Think of it this way - if 5,000 travelers like me stop traveling, that represents $500 million in lost top-line revenue (5K travelers x $100K annual spend). And that's HIGH MARGIN top-line revenue.

    I know this - I won't be investing in any airlines, hotels or rental car companies any time soon. I just don't see the need to do this like in the past. Once relationships are established, the reasons to be face-to-face, especially with all the technologies out there (net meetings, etc.), are few and far between. I expect this trend to continue.

    When you complain why SWA is under $10 per share, think about what I wrote. It's an issue not unique to SWA - it plagues the entire airline and travel industry.

    wsj

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