Southwest Airlines SWOT Analysis -
powerful business assessment tool

The SWOT Analysis of this very well-run business
provides a model to emulate in other businesses.

The Southwest Airlines SWOT analysis is a good example to illustrate how a SWOT analysis can be a helpful tool for any business. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.

A SWOT analysis is a strategic planning method that helps a business understand itself better and make plans to move forward. Based on the SWOT analysis, smarter goals and decisions can be achieved.

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SWOT Analysis Examples

Strengths and Weaknesses are internal factors (things that can be controlled) that exist within any organization, such as Southwest Airlines (SWA). Examples of internal factors would be finances, manufacturing capabilities, and management abilities.

Opportunities and Threats are external environmental factors (that cannot be controlled) that have an affect on any organization. Examples are fuel costs, new legislation, technological changes, and changes in the marketplace that affect your organization.

Take a look at the Southwest Airlines SWOT analysis below. Get a good idea of how you could set up your own SWOT analysis for your own business objective(s).

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Southwest Airlines SWOT Analysis Strengths

• More departures than any other US airline
• Diverse, upper management; very well run business
• Considered the best low cost carrier in recent years.
• High capacity usage (few unfilled seats)
• Dominates the short haul segment of the airline industry
• Is one of the most profitable airlines, while many other airlines are unprofitable
• Maintains very good relationships with its unions
• Management has a history of making successful acquisitions
• Low-cost, efficient operations equates to low fares/great value
• Employees are allowed/encouraged to have and show their sense of humor
• It feels fun to fly on Southwest
• SWA has only one basic type of aircraft/reduces training times
• Employees work very well as a team
• Very good safety record
• SWA could selectively introduce higher priced options

Southwest Airlines SWOT Analysis Weaknesses

• Few morning flights offered
• No flights to international destinations
• Dependent on a single type of aircraft - the Boeing 737
• Most employees belong to a union
• Only one class of seating is offered - coach
• Booking flights is not available except directly through Southwest Airlines
• It does not offer frills such as airport lounges, videos on board, etc.
• Can only carry a small amount of cargo and freight

Southwest Airlines SWOT Analysis Opportunities

• Growth of Hispanic population and the elderly generation - potential markets
• Overall air travel is predicted to increase pretty rapidly this decade
• International markets are not yet served by Southwest
• New technology - opportunities for new services and products
• Better use of the Internet for marketing, ticketing, etc.
• Longer flights are a growing market
• New plane technology, such as the Dreamliner, will increase air travel

Southwest Airlines SWOT Analysis Threats

• Fuel price increases could reduce air travel
• Decline of leisure travel due to terrorism and/or a depressed economy
• New government regulations could make air travel more costly
• Cost will likely rise since there is not many more areas for cost-cutting
• High-speed rail could someday hurt short and medium length air travel
• Increased competition would likely hurt industry profitability

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If you would like to discuss doing a SWOT Analysis and how to best benefit from the results, or discuss other types of business assessments, please feel free to contact me.