FAA Approves Southwest Airlines Acquisition Of AirTran Airways

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FAA Approves Southwest Airlines Acquisition Of AirTran Airways By Shane Nolan

		February 25, 2011 - The Federal Aviation Administration (FAA) informed Southwest Airlines that it has accepted the carrier's transition plan to combine the operations of Dallas-based Southwest Airlines and Orlando-based AirTran Airways, following the financial close of its transaction to acquire AirTran. On Sept. 27, 2010, Southwest announced an agreement to acquire all outstanding shares of common stock of AirTran Holdings, Inc., the parent company of AirTran Airways (AirTran), for a combination of cash and Southwest Airlines' common stock. Closing is subject to the approval of AirTran shareholders, receipt of certain regulatory clearances, and fulfillment of customary closing conditions.

"It's been a great team effort by a lot of people to reach this initial milestone, but we still have a lot of work to do to ultimately bring our two carriers together. We appreciate the collaborative approach of all parties, including the FAA Joint Transition Team (JTT)," said Brian Hirshman, Southwest's Vice President Maintenance and Engineering, and Executive Sponsor of the carrier's Single Operating Certificate (SOC) team. "We consider this acceptance by the FAA as the first major milestone on the journey towards SOC. There are too many people to recognize individually, but we are hopeful the team's hard work will allow us to achieve our SOC goal in the first quarter 2012." Southwest and AirTran currently have separate operating certificates. The transition plan accepted by the FAA outlines the methodology, processes, tools, and timing to be employed to maintain the safety of their day-to-day operations during the transition period and to ultimately achieve a Single Operating Certificate. The SOC is issued by the FAA once all of the steps outlined in the transition plan have been completed. The carriers' processes, and procedures may not be fully integrated when the SOC is issued, however; they will operate under a single FAA certificate at that time. Relevant to its submitted plan, Southwest clarified that after the transaction close, which is currently anticipated to occur during the second quarter of 2011, all certificated and flight-related AirTran Employees (Pilots, Dispatchers, Flight Attendants, Mechanics, Schedulers, etc.) will maintain their AirTran employment status at least until the SOC is issued by the FAA for the combined carriers. The logistics of how and when this group of certificated employees will then be transitioned to Southwest employment status has yet to be determined.

Southwest Airlines is the nation's largest carrier in terms of originating domestic passengers boarded, now serving 69 cities in 35 states. Beginning March 13, 2011, Based in Dallas, Southwest currently operates more than 3,200 flights a day and has nearly 35,000 Employees systemwide.

AirTran Airways is an American low-cost airline. A subsidiary of the Orlando-based AirTran Holdings, AirTran operates over 1,000 daily flights, primarily in the eastern and midwestern United States. AirTran's principal hubs are Hartsfield-Jackson Atlanta International Airport, where it operates over 270 daily departures, and General Mitchell International Airport in Milwaukee, Wisconsin. It maintains secondary hub operations at Baltimore-Washington International Thurgood Marshall Airport and Orlando International Airport. AirTran's fleet consists of Boeing 717 aircraft, of which it is the largest operator, and Boeing 737-700 aircraft.

AirTran Airways traces its roots to the 1992 founding of ValuJet Airlines in Georgia, United States. The founders were airline industry veterans, including an executive group from the former Southern Airways and pilots, mechanics and flight attendants from the defunct Eastern Air Lines. The Federal Aviation Administration's (FAA) Atlanta field office sent a memo on February 14, 1996, to Washington, D.C., stating that "consideration should be given to the immediate FAR-121 rectification of this airline"--in other words, the FAA wanted ValuJet grounded. ValuJet planes made 15 emergency landings in 1994, 57 in 1995, and 57 from January through May 1996.

In February the FAA ordered ValuJet to seek approval before adding any new aircraft or cities to its network, something the industry had not seen since deregulation in 1979. This attempt at removing ValuJet's certification was "lost in the maze at FAA" according to NTSB Chairman Jim Hall.

By this time, ValuJet's accident rate was fourteen times that of legacy carriers. On May 11, 1996, ValuJet suffered its highest-profile incident when its Flight 592, a DC-9 jetliner flying from Miami to Atlanta, plunged into the Florida Everglades, killing all 110 aboard.

After the Flight 592 crash, many of ValuJet's other cost-cutting practices came under scrutiny. It had allowed one plane to fly 140 times despite a leaky hydraulic system, and allowed another plane to fly 31 times with a malfunctioning weather radar.

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