Skip to content

Southwest marks 40 years in pivotal markets as it plots post-pandemic course

Jan. 31, 2022
6 min read
Southwest marks 40 years in pivotal markets as it plots post-pandemic course
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Southwest Airlines is feeling nostalgic.

The airline celebrated its 50th anniversary in 2021, as it reached what its leadership sees as a crucial juncture in the airline's evolution.

Want more airline-specific news? Sign up for TPG’s free new biweekly Aviation newsletter!

As it starts its 51st year, Southwest is making a big push for managed business travel; the airline is growing and revitalizing its fleet as it continues to take delivery of its massive Boeing 737 Max orders; it's looking to finally see consistency in its Hawaii venture after two rocky pandemic-defined years; and coming off the heels of a massive expansion that added 18 new markets, it's looking to buffer its network by building up frequencies lost to the pandemic and the expansion.

To top it all off, the airline's longtime CEO, Gary Kelly, is stepping back and will be replaced by another longtime Southwest executive, Bob Jordan. Kelly will still continue as executive chairman of the board of directors, which will see him leading the airline's broader strategy.

With big plans and big changes ahead as Southwest looks forward to its next chapter, nostalgia has it also looking back in time.

Southwest's 2022 anniversary isn't as significant as the one it had in 2021, but it's certainly up there, chief commercial officer of the airline and bona fide AvGeek Andrew Watterson told TPG in a recent call.

More: Southwest expanded like wildfire during 2021. Here’s its plan for 2022.

It was 40 years ago on January 31, 1982, that Southwest launched service from Las Vegas, Phoenix and San Diego. These were not the airline's first markets outside of Texas, but they represented an aggressive westward expansion that formed a cornerstone of Southwest's current system.

Sign up for our daily newsletter
A Southwest route map from early 1982, shows the three cities that launched on Jan. 31, as well as Kansas City, which saw service begin on Feb. 18. (Image courtesy of Southwest Airlines.)

"We're number one in all three cities," Watterson said. "And they're all really pillars of our network."

(American Airlines is larger than Southwest in terms of number of flights, according to data from Cirium, but Southwest tops American in terms of number of passengers carried, according to Phoenix Sky Harbor International Airport).

"If you look at the 18 new cities we started during the pandemic, and Hawaii, a lot of them touch these three," he said.

The three markets made sense at the time, even without the eventual broader growth in mind.

Las Vegas is, well, Las Vegas. It was a different scene at the time, rougher and less family-friendly, with the transformation to the big, corporate-backed spectacle of today just getting started — in Martin Scorsese's "Casino," which ends around 1979, Robert De Niro's character closes the final scene of the movie lamenting the start of this change.

Southwest held a ribbon-cutting event when it launched service in Las Vegas on Jan. 31, 1982. (Image courtesy of Southwest Airlines.)

Nevertheless, it was a destination in its own right when Southwest launched service from Houston and Phoenix, with plenty of demand to capitalize on — demand which would grow over the following decades.

More: Is Canada next? Retiring Southwest CEO Gary Kelly discusses carrier’s future

San Diego was Southwest's first destination in California, and the start of a legacy. In 2002, according to Watterson, Southwest became the biggest airline in the state, and it remains the largest today in terms of number of flights. According to data from Cirium, Southwest had 260,284 scheduled flights from California in 2021. United Airlines was the second biggest carrier out of California last year with 206,672 flights.

A Southwest Airlines ramp agent guides a Boeing 737-200 aircraft at San Diego International Airport in 1982. (Image courtesy of Southwest Airlines.)

San Diego was a logical entry point into California thanks to its proximity to the rest of the airline's network. Southwest added service to Los Angeles and San Francisco in the second half of the year.

"We started life as a short-haul carrier with a heavy business concentration" along with demand from passengers visiting friends and relatives, Watterson said. "As we went out west, these were shorter-haul markets, so our model worked well, with fares, frequencies and fun."

Phoenix has become a top focus city for Southwest over the past 40 years, and it will have a new concourse with additional gates open later this year.

Southwest executives and Phoenix City Council members cut the ribbon on a ticket counter expansion at Phoenix Sky Harbor International Airport in 1988. (Image courtesy of Southwest Airlines.)

"Phoenix is one of those markets that's both business and leisure," Watterson said. While leisure demand is seasonal, "it's a year-round business market, so our short-haul business relevance is something that we value."

More: Exclusive: Southwest wants business travelers and will double down on them as it recovers from the pandemic

While Southwest has expanded more broadly around the U.S., and added additional focus cities such as Denver and Baltimore, the three cities that Southwest began servicing remain crucial to the airline's network planning, Watterson said, making them reliable points to connect new markets like the 18 that were opened last year.

The cover of Southwest's 1982 Annual Report for investors, featuring the new cities added that year. (Image courtesy of Southwest Airlines.)

"We have big customer bases in all three," he said. "So when you add a flight, you have a customer base already built in. We have customers there that know us and love us."

"That strength really empowers us when we need to expand our network," Watterson added. "This time, we did it when the chips were down, so to speak, because of the pandemic. And so the fact that we plugged into these three so much shows how they're still very relevant to us."

Featured image by A Southwest Airlines ramp agent guides a Boeing 737-200 aircraft at San Diego International Airport in 1982. (Image courtesy of Southwest Airlines.)
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Top offers from our partners

How we chose these cards

Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
See all best card offers

TPG featured card

Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

2 - 10X points
10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day

Intro offer

75,000 bonus miles
Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

Annual Fee

$395

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,300+ lounges, including Capital One Lounges and the Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023
Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day
  • Intro Offer
    Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

    75,000 bonus miles
  • Annual Fee

    $395
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,300+ lounges, including Capital One Lounges and the Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023