Prior to deregulation the Civil Aeronautics Board ‘experimented’ with the idea of price competition and allowed airlines to undercut Southwest Airlines prices. Southwest, flying only inside Texas at the time, wasn’t subject to CAB price regulation.
Texas International Airlines (which would later acquire Continental, Eastern, People Express, and Frontier) along with Braniff started offering $13 fares between Houston and Dallas. Not to be undercut, Southwest introduced a two-tiered fare structure.
- They offered to match those $13 fares
- They also continued to offer a $26 fare, which would include a free bottle of liquor to take home
Business travelers on expense accounts continued to ‘buy up’ to the higher fare, pocketing their choice of liquor. Southwest became the largest liquor distributor in the state of Texas.
For many years Southwest Airlines offered free drinks inflight to all customers. They cut that back to offering free drinks only during key business travel times. And then in 1988 they eliminated free alcohol from their flights, but started giving coupons to frequent flyers. When the airline started enforcing expiration dates on free drink chits, that led to a class action suit which settled in 2015.
Still, booze are part of the Southwest Airlines DNA stemming also from hard drinking CEO Herb Kelleher. Drinks were often comped on holidays for celebration, and during delays. Southwest, though, eliminated their signature snack, peanuts, last year. Kelleher passed away at the beginning of the year. And the drinks no longer flow as freely.
I had a four hour delay of my Southwest Airlines Washington National – Austin flight yesterday. I had originally been booked on American, but my flight cancelled. I’d been auto-rebooked for travel this evening, and the best I could do finding my own inventory was DC – Indianapolis – Chicago – Austin. So I bought the last Southwest Airlines seat on the non-stop.
Right after I arrived at the airport, as our inbound aircraft entered its approach pattern, a storm struck and a tornado warning was announced. Passengers were asked to move away from the windows in the terminal A ‘Banjo’ at National airport, towards the center of the pier. The storm passed quickly, but several aircraft running low on fuel had to divert. And some of those diversion airports saw storms as well and closed.
As a result my Southwest flight delayed four hours. I was grateful I made it home. Still I thought Southwest Airlines ought to comp drinks.
I say @SouthwestAir should comp drinks on a four hour delay. What say y'all, Twittermind?
— gary leff (@garyleff) May 24, 2019
To be clear: my point was not that this was Southwest’s fault, or that they owed anybody anything. To me, though, it was an element of hospitality and in particular Southwest Airlines hospitality.
Southwest was losing money having to divert, and delays are costly, free drinks multiplied out across several delayed flights aren’t free… to them. They got me home, and I appreciated that.
Thinking about my own take, though, underscores that there are two different models of airline service: transactional (getting precisely what is due) and hospitality-focused. Most airlines do not see themselves as being in the hospitality business.