Southwest Airlines is expected to announce this week that it will start flying between California and Hawaii, news that has rival airlines lowering airfares to the islands. While that may be welcome news for budget-minded vacationers, it raises the possibility of something that many airlines dread: an airfare war.
Southwest is conducting its test flights between airports in the two states as it seeks approval from the Federal Aviation Administration for the new routes, the San Antonio Express-Newsreported. If all goes well, the airline will announce new routes and sales as early as Valentine’s Day.
That news has prompted airlines with routes to Hawaii to begin lowering their airfares. A Google Flights search shows that American Airlines is already offering a one-stop, round-trip flight in March from Oakland to Honolulu for as low as $339. Hawaiian Airlines and Alaskan Airlines are both offering a non-stop, round-trip flight for as low as $363.
On Southwest’s site, the airline says its “initial intention” is to offer flights between four Hawaiian airports—Honolulu, Kahului, Kona, and Lihue—and four airports in California—Oakland, San Jose, San Diego, and Sacramento.
Founded in 1971, Southwest has an unorthodox history among U.S. airlines of offering no-frills, low-fare flights while emphasizing customer service. That approach has helped the airline expand profitably over the decades. It now ferries more than 120 million passengers a year. Along the way, the airline has entered more than its share of fare wars.
According to a story last year on Condé Nast Traveler, airfare wars tend to peak a couple of days after an airline posts an unusually low price. But such fare wars can be especially deep and long-lasting “when carriers are launching new routes and trying to grab a share of the market with is-that-really-the-price prices.”
That scenario happens to describe the market that Southwest’s soon to be competitors in Hawaii may soon be facing.