Southwest Airlines has won the battle for Milwaukee.
With Monday's announcement that Frontier Airlines has cut back their flights even more, it is startling clear that Southwest's move into Milwaukee made them the market leader, at the expense of the competition.
Don't get me wrong, from a capitalistic point of view, it worked wonders. You had a company that saw an opportunity, has a viable business model, beat the competition, and now rules the roost. The American dream!
But the cost of airline tickets was the collateral damage. Or was it?
Competition is good. From the time that Midwest Airlines was fighting off the hostile takeover from AirTran, through some point when I wasn't paying attention last fall, the consumer was the victor. As I've mentioned in past blogs, when Southwest entered the Milwaukee market, they (and their competition) had such low introductory fares that I couldn't help but buy a round trip ticket to Las Vegas for $138. In 2010, my wife and I went to New York City for about $160 round trip. A trip to Reno for a couple hundred bucks... I gotta tell you, it was a golden age.
But the first tip that something was amiss was in early-March of this year. I was asked to make a business trip to Knoxville (which is one of the most expensive airports in the country), and though I had 21 days to get the airline ticket, the best I could do was $650 round trip on US Air through Charlotte. $650... I used every trick I knew, from looking for promo codes and consulting multiple search engines and consolidators. Nothing worked, so I spent my potential Christmas bonus on one plane ticket.
Shortly after, the Poker Buddies started planning our fall trip to Las Vegas and we were stunned. The same airline that trained us to get low fares (and we are looking at you, Southwest) had failed us. For three years, we've flown on Friday and returned on Monday. Flights on those days for all of the weeeknd days were close to $378 round trip. Yikes! Using the same tricks that failed me on my trip to Knoxville worked this time, and we did book for $246 round trip on - wait for it - Frontier, with the caveat that this year's trip is a Saturday through Tuesday (Side note; now we just have to make sure that Frontier lasts that long).
Sure, I am griping about the high cost of airline tickets (Side note; a fair case can be made that the high fuel costs aren't helping) but air travel really is discretionary.
Did I NEED to go to Knoxville? I did not. Management could have had me teleconference, I could have driven for a lot less, or (and is usually the case) it was a waste of time and the money didn't need to be spent.
Do I NEED to go to Las Vegas? Though I may think that I do (addictions are rough, you know) My-Sugar-Na will disagree.
However, if the market can bear the fares, then this is actually a good thing. Frontier may be transferring and furloughing workers, but Southwest has actually added to their staff to handle the Milwaukee routes (Side note; are you aware that Southwest also now owns AirTran?) As long as planes - regardless of airline - fly into and out of Mitchell International, then the parking lots will be full, the restaurants and shops at the airport will be busy, and everybody will be making money.
Another way to look at this is to compare it to the grocery stores in Milwaukee over the past 25 years or so...
Kohl's Food Stores were king (beating out Red Owl and A&P), Pick'n Save's lower prices drove them (and other competitors like Jewel) away. Now Pick'n Save got fat and happy, decided on a business model (nicer stores with a little higher prices) and now are worried that WalMart, Target and Woodman's all have lower prices, and Sendik's has better stores (they're so civilized) and are known for higher quality. Pick'n Save is in the middle of a squeeze.
If Southwest/AirTran lets that happen to them, the next growing airline (Jet Blue? Spirit? One that doesn't yet exist?) will find a way in and drive Southwest away.
Just like its supposed to work. Capitalism. The American way. I love it.