The event was Southwest’s Spirit Party, and the airline on May 12 made the Fremont Street Experience its unofficial headquarters. “It’s just a chance for us to have a little family reunion,” said Southwest CEO Gary Kelly, who you’ve probably seen in one of its TV commercials telling you to “Grab your bag … it’s on.”
In 2009, more than 7,000 Southwest employees grabbed their bags and came to Las Vegas for a Spirit Party. In the days leading up to this year’s party, Southwest was expecting a 20 percent to 25 percent increase in attendance over last year. “I think that’s enough to move the dial (on tourism spending),” Kelly said.
Southwest employees have to spend their own money to get here for the party and once they arrive, have to shell out for their lodging. But the company has plenty of food and entertainment to keep the party going. In fairness, not all of the 10,000 partygoers — more than a quarter of Southwest’s workforce — came from out of town. Las Vegas is Southwest’s biggest station, so many of the airline’s 2,621 locally based employees didn’t have to hop a plane to get to the party. “Yes, it’s always well attended by our Las Vegas folks, and Las Vegas continues to be our largest operation,” Kelly said. “It’s a point of pride for us.
We love being the hometown airline for you guys.” Another great thing about the Spirit Party, besides 10,000 people spending money in downtown Las Vegas, is that Kelly gets in a party mood and is willing to talk beyond the news releases about what the company is doing in Las Vegas.
Some highlights:
• The good news about the number of flights on Southwest’s Las Vegas schedule is that they’re increasing instead of declining. But the bad news is that the level is still below the maximum number it had in 2008. At the peak in 2008, Southwest had around 235 daily flights. Last August, there were about 228. As demand fell off, Southwest fell below 220. In the new schedule, which takes effect in the fall, there are 223. (Southwest counts its flights differently than McCarran statisticians, counting an operation that runs five or six times a week as a daily flight while McCarran breaks it down to five-sevenths or six-sevenths of a daily flight).
• Kelly considers the outlook for Las Vegas to be positive and the revenue environment to be healthy. But it’s all about supply and demand. Kelly said that if demand picks up, Southwest would add flights.
• Using history as a guide, Kelly thinks the proposed merger of United and Continental may provide some opportunities for Southwest — but not necessarily in Las Vegas. The legacy carriers have focused recently on international flying as opposed to domestic routes. As a result, Southwest has grown and the legacy carriers have shrunk their market share on domestic routes.
• Kelly said he wants Southwest to grow, but he’s not sure how that will happen. The airline has had two acquisitions, Morris Air at the end of 1993 and ATA Airlines toward the end of 2008, and it tried unsuccessfully to bid for Frontier Airlines in 2009. The Frontier bid was an effort to take control of the Denver market, where Southwest has expanded dramatically in two years. Southwest has grown significantly in St. Louis, where it is now that city’s busiest carrier.
• Southwest could grow by adding cities as it did in the past two years by flying into Minneapolis, Milwaukee, New York’s LaGuardia Airport and Boston’s Logan International. The airline will begin flying to Northwest Florida Beaches International Airport in Panama City, Fla., later this month. Kelly is always tight-lipped about where Southwest would go next and the rumor mill is constantly churning out theories. The most recent rumors involve Wichita, Kan.
• Southwest and Canada’s WestJet Airlines abruptly ended their code-share deal last month, which would have likely increased Las Vegas flights if the airlines were to use McCarran as a transfer point. Kelly said Southwest is working on a code-share deal with Volaris Airlines, a Mexican carrier, but it’s unclear where passengers would transfer. Volaris doesn’t serve Las Vegas. Kelly said Southwest has the capacity to add a second code-share partner, and he said the airline is evaluating opportunities that could deliver Southwest customers to destinations such as Hawaii and the Caribbean.
• Southwest is in the midst of some technological advances that would result in a next-generation frequent-flier program. Kelly didn’t give any details of how the souped-up Rapid Rewards program would be different. Before the end of the year, Southwest also is expected to roll out details of its in-flight Wi-Fi system.
(Richard Velotta - Las Vegas Sun)
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