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Southwest Gets Ready to Go Global

Domestic discount airline Southwest could soon go international.

Annise Parker, Houston’s Mayor, added her support to Southwest’s proposal to build an international terminal at Houston’s Hobby Airport. Southwest proposes to foot the bill for the terminal; it just wants permission to build the facilities it needs to fly from Houston to nearby points in the Caribbean, Mexico, and Central and South America. The mayor adds her weight to a fairly long list of supporters.

Houston already has extensive international service at its newest and largest airport, George Bush Intercontinental, mostly on United, flying former Continental routes. But Southwest serves Houston only through the older Hobby Airport, and it wants to add its international service at the hub where it already operates lots of domestic flights.

Normally, Southwest’s proposal would be welcomed by just about everybody in the area. An airport improvement paid for by an airline and new low-fare international service from a reliable carrier—what’s not to like?

One major airline isn’t thrilled: United doesn’t want international competition at Houston. The carrier is putting up as much resistance as it can, and it has a lot of local clout. Houston was one of Continental’s major hubs before the airline merged with United, and much of Houston’s business community has ties to United.

In my view, United’s public arguments against Southwest’s proposal are absurd. But the validity of the argument really doesn’t matter; what matters is the local power struggle. And having the mayor on its side is a big win for Southwest.

Although the fight isn’t over, Southwest’s outlook is pretty bright. If the deal goes ahead, the real winners will be travelers who want low international fares from Houston.

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