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SOUTHWEST AIRLINES TO ACQUIRE AIRTRAN; SPREADING LOW FARES FARTHER

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Southwest Airlines announced today that we have entered into a definitive agreement to acquire all of the outstanding common stock of AirTran Holdings, Inc., a parent company of AirTran Airways (AirTran), for a combination of cash and Southwest Airlines common stock. 

Although the agreement depends certain approvals, we’re all very excited about what it can mean for our Employees, our Customers, the Communities we serve, and our Shareholders.
If approved, the acquisition will give us broader national presence – allowing us to offer low fares and exceptional service in markets that will benefit from increased competition.

But there’s a lot of work to be done and decisions to be made, and nothing changes right now.
Until the deal closes, Southwest and AirTran will continue to operate as separate and independent companies.

In the meantime, we have developed a special website – www.lowfaresfarther.com – where you’ll find our news release and more information about today’s exciting announcement!  

Important Information for Investors and Stockholders

This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.  The proposed acquisition of AirTran Holdings, Inc. (“AirTran”) by Southwest Airlines Co. (“Southwest”) will be submitted to the stockholders of AirTran for their consideration.  In connection therewith, Southwest will file a registration statement on Form S-4 with the Securities and Exchange Commission (the “SEC”) that will include a proxy statement of AirTran that also constitutes a prospectus of Southwest.  Southwest and AirTran also plan to file other documents with the SEC regarding the proposed transaction.  SOUTHWEST URGES INVESTORS AND SECURITY HOLDERS OF AIRTRAN TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.  Investors and security holders may obtain free copies of the proxy statement/prospectus and other documents containing important information about Southwest and AirTran, once such documents are filed with the SEC, through the website maintained by the SEC at www.sec.gov.  Copies of the documents filed with the SEC by Southwest will be available free of charge on Southwest’s website at www.southwest.com under the tab “Investor Relations” or by contacting Southwest’s Investor Relations Department at (214) 792-4415.  Copies of the documents filed with the SEC by AirTran will be available free of charge on AirTran’s website at www.airtran.com under the tab “Investor Relations” or by contacting AirTran’s Investor Relations Department at (407) 318-5187.

Southwest, AirTran and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of AirTran in connection with the proposed transaction.  Information about the directors and executive officers of Southwest is set forth in its proxy statement for its 2010 annual meeting of shareholders, which was filed with the SEC on April 16, 2010.  Information about the directors and executive officers of AirTran is set forth in its proxy statement for its 2010 annual meeting of stockholders, which was filed with the SEC on April 2, 2010.  These documents can be obtained free of charge from the sources indicated above.  Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.

Cautionary Statement Regarding Forward-Looking Statements

This communication contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of  1933, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on, and include statements about, Southwest’s estimates, expectations, beliefs, intentions, and strategies for the future.  Specific forward-looking statement include, without limitation, statements regarding Southwest’s plans and expectations with respect to the acquisition of AirTran and the anticipated impact of the acquisition on Southwest’s operations, including without limitation, the expected impact of the acquisition on (i) Southwest’s growth and  competitive position; and (ii) its Customer experience.  These forward-looking statements are based on Southwest’s current intent, expectations, and projections and are not guarantees of future performance. These statements involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from those expressed in or indicated by them.  Factors include, among others, (i) the possibility that the transaction is delayed or does not close, including due to the inability of Southwest and AirTran to obtain all approvals necessary or the failure of other closing conditions; (ii) Southwest’s ability to successfully integrate AirTran’s business and realize the expected synergies from the transaction; (iii) the impact of the economy on demand for air travel and fluctuations in consumer demand generally for the services to be provided as a result of the transaction; (iv) the impact of fuel prices and economic conditions on Southwest’s business plans and strategies; (v) actions of competitors, including without limitation pricing, scheduling, and capacity decisions, and consolidation and alliance activities; and (vi) the impact of governmental regulations on Southwest’s operations.

Southwest cautions that the foregoing list of factors is not exclusive.  Additional information concerning these and other risks is contained in Southwest’s and AirTran’s most recently filed Annual Reports on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other SEC filings.  Southwest undertakes no obligation to publicly update any of these forward-looking statements to reflect events or circumstances that may arise after the date herof.

 


 

64 Comments
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Congratulations on this business acquisition. I only hope that you are successful in pushing the Southwest culture into AirTran. We love Southwest, and for my wife in particular, it is the only airline she will fly. The main reason for that is a very bad experience with AirTran. She was travelling with a baby, and had to deal with constantly changing departure gates, a delayed plane, and rude and unhelpful employees. When she finally arrived in Boston, AirTran lost her luggage. And I don't mean "temporarily misplaced"; she never again saw her suitcase. The process of trying to keep in contact with the status of the luggage and baggage claim at Logan was excruciating. More rude and unhelpful employees, no one answering phones (she eventually resolved to just calling semi-random extensions to find people), and when AirTran eventually admitting the luggage would never be found, the claim process was supposed to involve documenting all the contacts and providing receipts (who has receipts for everything in their luggage!), all to receive some arbitrary and significaly reduced value for the contents (not nearly enough to replace the contents). She absolutely swore off AirTran as a result, and it very strongly biased towards Southwest as a result of our positive experience with Southwest, whose employees are generally very helpful. Basically, our experience with AirTran has been the antithesis of our experience with Southwest. If Southwest can acquire AirTran and "transform" them into Southwest, the world (i.e., customers like us) will benefit. I just hope that AirTran doesn't "taint" Southwest in the process.
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This is great news. Dust-off an old Eastern Airlines schedule and see where new routes could occur.... Please take a look at SDF as a Focus City!
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Congratulations SWA. An exciting day for the company. As a loyal customer, I look forward to the opportunities that this acquisition provides over the long run including more service into the slot restricted airports of the east, Atlanta, the opportunity to serve a variety of smaller domestic markets and the Caribbean, just to name a few.
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I have successfully avoided flying ValuJet for many many years, but my luck may be about to change. Good luck with the acquisition, if anyone can fix that airline it's you guys
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Who put chocolate in my peanut butter? I've been flying Southwest almost weekly for the past 7 years and Airtran has been my "go to" alternative when scheduling or routing through Southwest isn't possible. Congratulations to both companies and their employees. You have made a good thing even better and I look forward to converting my Airtran points into Southwest Rewards!
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I hope this means Southwest will be serving Memphis now.
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I am so excited!!! I LOVE SOUTHWEST and have missed not having them as an option in Atlanta over the past 10 years I have lived here. I would never fly AirTran because I still don't really trust them... how many names can one company have...VALUEJET, need I say more. Now, Southwest I am know will take over and provide maintenance on the planes so that I can finally say goodbye DELTA...rip-off of company of the sky... My platinum status will now be gone, because I will no longer fly with them. Anyway....LOVE YOU SOUTHWEST, THANK YOu.
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ATLANTA - TO DULLES HERE WE COME!!??? how many gates would you all get in ATL?
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I think this is a great move, but a big question to this merger is - what is Southwest going to do with the Boeing 717? According to the website, the majority of the AirTran fleet is the 717. Will Southwest keep them or start to replace the 717 with the Boeing 737-600? I've never been fond of the 717 or the DC-9 legacy it comes from, but this will be a big question since it'll add to the overhead costs of the airline. Otherwise, I look forward to the chance to get more places from Phoenix than before. The other important point, as long as the fees stay away, I look forward to the new things that could be on a Southwest flight.
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Wow! What a surprise to my Monday Morning! Congratulations on the deal. I look forward to the exciting changes and other announcements.
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Airtran sold me out. I basically left Southwest for Airtran. Liked having seat assignments and liked the business class. Southwest has already stated it will eventually do away with both. Guess it is all about the dollar in the end. Cram a couple more heads of cattle in the metal tube -- that is the business plan. Congratulations to you both, but I will not fly with you. Well, time to search for a new airline!
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I am now a retired SWA employee. Prior to working at SWA, I worked at Airtran, trying to get my foot in the door at SWA. The hiring, training and overall experience I had as an employee at Airtran was horrible. I could not believe an airline was run like that. Especially their HDQ in Atlanta. Absolutely horrible! However, once I was hired into SWA, the experience I had with SWA, hiring, training, etc was First Class and overwhelmingly satisfying. I remember saying, "Thank Goodness SWA saved me from Airtran." SWA will have their hands full with Airtran employees and their lack of standards. Especially their training out of Atlanta. SWA will totally have to take over and more than likely, eliminate alot of the leaders of Airtran. Their standards are very poor and they definately don't treat their employees like SWA does theirs. I'm happy that SWA has taken over Airtran. Finally getting into Atlanta. This will be great!
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Southwest, I see you are buying up AirTran and coming to Atlanta. Your open seating system is a shameful disgrace. I have not flown Southwest after my first three flights when I was unable to sit with my husband because of your policy in spite of arriving to the airport early. I witnessed parents being told they could not sit with children because "If you want a reserved seat, don't fly Southwest!" (bright smile accompanied this.) Your open seating policy does not streamline boarding. I can not see how it saves money to not allow your supposedly valued customers to choose a seat online. Open seating causes frustration for passengers and results in abuse of your own flight crews, whom you supposedly regard as family. I suggest that if you do not want to pay to have phone assistance for seating you at least offer online seat selection or Kiosk seating. If people are paying more for early online boarding why not offer them a real benefit? Atlanta is a classy town, Southwest. If you want to play with the big boys you need to drop the plan to keep imposing open seating on customers.
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Great News! Move over Delta...an airline that really cares about it's customers is coming to town! It couldn't come sooner.
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800 plane gorilla. At least, headed that way...
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Air-"Tran"? Was this airline founded in the town of Tran, Bulgaria, or was it named in honor of the 14th century Vietnamese dynasty?
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If I'd wanted to fly your airline out of BWI, I would have. I flew AirTran instead, because they have dual class, pre-assigned seating, and IFE. They were also a great deal easier to shop prices for since they allowed their airfares to be seen by aggregators like Kayak. Thanks so much for taking that all away from me. You've clearly already made up your mind and couldn't care less why AirTran's customers were flying them, since you've already announced your intention to remove those things that made AirTran unique. Thanks again, I don't know what I'd do without your obviously superior product being rammed down my throat.
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I certainly hope none of the horrible traits associated with AirTran find their way into the Southwest culture. Isn't that the same company that charges for carry-on baggage? I love SW and would hate to see it change. Thanks.
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Granted, Air tran was not that great, but WN isn't a winner in my eyes either. I am sick and tired of no service airlines. The only busniess that should be concerned is Greyhound as that is where WN passengers come from. I hope Delta blows WN right out of Atlanta and back to Love field where they belong!
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Thank you Southwest for continuing to make it easier not to have to fly another airline. When the deal closes so will the opportunities for other airlines that can't out Southwest the Southwest Airlines team!
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I hope you continue to operate in Huntsville, Al. We need a dependable airline here I love flying southwest, but don't like having to travel to Nashville or Birmingham to board
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About time you guys get in to Charlotte! More LGA, BOS and possibly DCA is definitely a good thing!
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We were bummed when we moved to Atlanta that Southwest wasn't here. After waiting almost 7 years...we can't wait to fly again with Southwest!!!
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I guess Value Jet is finally going to be gone forever. Not sure Southwest culture can compensate for the Value Jet mentality that Air Tran seemed to hold on to after they bought a name so most people would forget the dismal company they were prior to their Everglades crash. Good luck Southwest! Just wondering if Southwest will bring back the old Value Jet ATC call sign "Critter". . . I think they should!
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Can't believe that anyone thinks that Southwest in your city is a good thing for your city. Sure fares are low at first. They do that by raising fares in another city to gain market in another. Then, when they have the edge they control fares and charge whatever they want. Too many of you believe the BS that Southwest puts on advertisements. Your city is seldom better off because Southwest buys an airline to gain access to those routes. Reference Pittsburgh. But, if Southwest does get final approval for this deal, I think they should bring back the old Value Jet ATC call sign, "Critter" and use that. Good luck on the Southwest culture influencing that old Value Jet mentality that Air Tran never seemed to be able to shake. You can package an airplane in any color, but it still is that old nasty Value Jet controlling the shots.
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As long as Nashville stays constant or grows then this is terrific. However, if SW screws Nashville during the integration and makes getting everywhere a layover h3ll, I will never fly this airline again. No way am I connecting in that dump known as ATL. It's either going to remain a lot of nonstop destinations or I'm finding someone with perks to make the layover trip easier.
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Really...why is there any bellyaching about what you will miss out on with the demise of AirTran? Think about it...if that model was so great, then why is it it being sold off? No business can please you indefinitely if it is not profitable.
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Southwest has been trying for years to get into Atlanta. For those who want to waste money on fancy-ass service, stay with Delta. For the vast majority that want much cheaper, reliable, safe, and fun service, welcome aboard! As far as the "cattle-call" boarding that some talk about, a poll was taken for over a year and the vast majority voted in favor of the system Southwest has now, so the people have spoken! Southwest is already by far the largest and most popular domestic carrier, and for good reasons!
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Wow! I think this is a great move. Air Tran has great routes and only OK staff. That fleet of 717s has got to GO! They suck! Rickety ass planes! Every flight on one of those makes me more religious-- as in, " Thank God we landed!" Though the wifi is awesome, they shutter, shake, drip, leak, stink, and smell... I am hoping WN can give US Airways a run for its money on Intl flights out of PHX too! Best of luck to a wonderful company!
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I am happy. I finally to not have to fly BIG Airline going to Atlanta so they can steal more of my luggage.
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I wonder what effect the provision below between Southwest and St Joe (Panama City) will have on the perspective acquisition considering Pensacola is about 110 miles from the new Panama City airport. Is such a thing even legal in the eyes of the FAA/DOT? Southwest has agreed that it will not commence air service to any airport within 80 statute miles of the new airport during the term of the agreement. In the event Southwest starts service to any airport that is more than 80 statute miles but within 120 statute miles from the new airport during the term, Southwest and St. Joe will either negotiate a modification to the terms of the agreement to accommodate the impact of such service or the minimum revenues used in the annual break even calculations under the agreement will automatically be increased by 10%. In such event, Southwest has agreed that the air service to the new airport in Bay County would not be diminished.
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They announce to buy airtran and their website goes down.... hmmm, somebody doesn't want southwest to get any bigger.
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I want to know how Southwest will be able to perform early on at Atlanta Hartsfield when they have no history of service at that location. The Hub would be similar in size to Chicago Midway and built in a much shorter period of time. It will be alot of fun to see the marketing creativity used in Atlanta.
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Nashville might not get screwed since Atlanta has a large number of O and D passengers. It would likely make more sense to route connecting traffic through Nashville and maybe Saint Louis where its easier to get off the ground. Oh and you should love the fact that you may have absolutely No Problem gettin to New York at a good price.
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hey SWLuver in Tampa . Airtran DOES NOT charge for carry on bags. why is everyone brainwashed by Southwest Airlines and their flying buses. Airtran has business class seats, in flight wi-fi and actual assigned seating. Aitran is rated number 1 in customer satisfaction 3 years in a row. my wife is an Airtran employee and takes great pride in her work. no one and i mean no one from Southwest has said a word about the Airtran employees and their futures. until someone from SWA proves that Airtran employees aren't going to be disposed of, as SWA has does so in the past, to companies they have "merged" with, i am firmly against this "merger".
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To all of the SWA detractors shown here: Some of us will always fly SWA. If we cannot find a SWA flight to our destination, we do not go. We look forward to the added destinations that this merger will provide. Thanks Southwest!!!
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Dear Southwest Airlines, I just read the newspaper regarding the acquisition of AirTran. Praise The Lord! I am doing a happy dance! Please let there be direct flights from Islip to Indianapolis at a fare we college parents can afford. We love Southwest and I actually wrote to you about 3 years ago to see if you would be competing for spots at the new IND aiport. We need an alternative to AirTran, USAir, and LaGuardia to get our kids back and forth and to be able to visit. IU Bloomington has one of the finest music schools in the country, if not the world, and the Kelley School of business is reknowned. Indianapolis is a fabulous hub that has had a direct flight monopoly on it for years. It's a 1hr 45min flight that can take up to six hours to get there due to stops. Please remember the kids, parents, and drivers (Indy 500) that go there. Thanks so much!!!!!! Loraine Izzo
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Well why serve Pensacola Now? Is it a deal breaker? The same would apply to DFW and Maybe Newport News and maybe Akron/Canton where Dallas Love, Norfolk, and Cleveland may be the more preferred destination respectively.
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As a Houston native I've flown with Southwest for many years. Simply the best on-board staff and what fun it has been for all these years. My career has taken me to a small town in Mississippi where I would drive for two hours to catch a flight on Southwest while Airtran was 10 minutes away. Thank goodness for the acquisition of Airtran. I hope Southwest will maintain the Airtran route from my small town so I can come home to Houston as often as I can. Thank You Southwest Airlines for your expansion and TERRIFIC service. I'm simply nuts about you!
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I would like to see retirees whose spouse has expired allowed a buddy pass for someone to travel with them.
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As a frequent flyer on Southwest (twice a week), I, like many other commuters from the Northeast to Baltimore/Washington really count on Southwest's many flights during Monday and Friday rush hours, its fare flexibility and pricing for my livelihood and to make my job possible, particularly in an area of the country that has suffered so much job loss. We are hopeful that this transition from low cost carrier to mega airline, together with the airline mergers in total that have reduced competition, will not jack up the fares that so many commuters around the country have grown to count on and that Southwest won't join the legacy airlines in its imposition of fees and restrictive behavior. That would choke many of the routes that it currently serves up and down the east and west coast.
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I try to fly SW exclusively because of their friendly staff and the fact that they fly through 'smaller' airports, which helps with their on-time reputation. They have NEVER lost my bags. Their frequent flier program is outstanding and I hope it doesn't change. This in conjunction w/ their credit card have allowed me to earn a companion pass for the last two years. My partner NEVER has to pay for a flight as long as I am on it. In fact, I have earned so many free flights, I can't remember the last time I actually paid for one! So you don't have an assigned seat? Pay the extra $10 and get preferred boarding, or go ahead and pay to check your bags w/ another airline in order to get your precious assigned seat. Personally, I am very excited to have more cities available and I can't wait to fly to Cancun for free.
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NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO. I could not think of a worse thing for Southwest. I am currently scheduled to fly to Orlando in November. My departing trip is on Southwest and my returning flight is on AirTran. The experience from past flights and the booking, changes, and customer service for my upcoming flight between the two airlines is a contrast more significant than the Atlantic Ocean was in 1092 or the Earth to the Moon in 1760. Southwest is dramatically underestimating the risk and effort involved in trying to merge these two cultures. Acquisitions rarely work look at the data. What a sad, sad day.
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Please Think, which I think is a funny name given your lack research before your comment. Airtran does have a very successful business model, different from Southwest but still very successful. I see you are asking why it is being sold. Why not I ask? With with merging of legacy carriers this gives them unparalleled dominance in certain situations, global network, frequency. So why not add over thirty cities to your route network, gain a major, vital hub to the southeast, and add over 140 planes. Lastly lol, I am sorry I didnt mean to laugh, and I quote "if that model was so great, then why is it it being sold off? No business can please you indefinitely if it is not profitable'. Your right but I hope you are not talking about Airtran. They have been profitable I think it has been for the past 10 years with only one minor loss on year. I am truly thrilled for this news. Two great companies will come together to better place itself in the crazy future of the airline industry.
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I am thrilled about this merger. I usually fly Delta because they often match Air Tran's prices, but now with Southwest in Atlanta, I'll be able to fly on the BEST airline and I won't even have to travel to Alabama or elsewhere to do so!!!
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AirTran is GREAT airline. AirTran was not going out of business and did not need SouthWest to bail them out. A message straight from the CEO of Southwest (Gary Kelly)"The opportunities for growth that flow from AirTran acquisition are enormous:more destinations; more Customers; more flights, and more profits. All of that adds up to growth, more aircraft, and more jobs." SouthWest wanted and needed Atlanta and the MidWest market, and they could achieve this alot easier by buying AirTran and not competing with them. It's a WIN WIN for customers and the employees. Just thought you needed to know
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It really shows that the Airline industry is picking up this year. Someting else that is you will find interesting is this show on YouTube called Top Trending Topics. SouthWest Airlines is trending yesterday on Twitter so tweets about it has been included in the show's episode of the day.
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Hey, fireloviesmith... check your facts... Southwest is not "merging" with Airtran. It is an acquisition. As was the earlier deal with Morris Air that you are referring to.
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This is great news, mainly for the fact that maybe in the near future, I can fly from Grand Rapids to Reno. Southwest is my favorite carrier, but I've had to drive either to Midway or Detroit, adding a 3-5 hours drive.
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This is a Win Win situation for both companies! With all the other Mergers and such going on, this was the best and possibly the only way for both companies to grow at a rapid rate and at little cost. I applaud both CEO's for making this happen. Truly a smart business decision.