Southwest Airlines cargo to go international in 2017

For a carrier that flies only 737 narrowbody passenger aircraft, Dallas-based Southwest Airlines carries a substantial amount of freight throughout its domestic network – some 98,400 tonnes in 2015. Despite various interline agreements with international carriers, Southwest still lacks the ability to carry cargo to any of the international destinations in its network. Next year this will begin to change.

Wally Devereaux, Southwest’s senior director, cargo and charters, told Cargo Facts that, in 2017, the airline will unveil a new point-of-sale and back-office IT system that will enable the carrier to make international freight bookings for the first time.

In 2011, when Southwest Airlines acquired Orlando-based AirTran Airways, it picked-up eighty-eight 717s and access to seven new international cities, giving Southwest’s network a strong boost in Latin America. Although the integration was more or less finished on the passenger side by the close of 2014, and the former AirTran 717s were slowly transferred to Delta Air Lines, Southwest has yet to carry cargo on its international routes. Even today, “we are still not able to put cargo on those international flights,” Devereaux said. “And that is certainly something we wanted to be able to do – to be able to grow [cargo], as Southwest Airlines grows, beyond the United States.”

The largest obstacle preventing international bookings, Devereaux added, was the antiquated, closed-loop IT infrastructure built in the 1990s. After tinkering with a few off-the-shelf products, the airline eventually decided it was time to design and develop the system in-house.

Now that a new system is more than two-thirds under way, Southwest’s cargo division has started to explore how the new capabilities of the IT system may factor into its long-term international strategy, such as the ability to share electronic airway bills, accept payments in multiple currencies and exchange messages directly with U.S. Customs. Devereaux said that, because forwarders will be able to book directly online, Southwest will also be able to pursue new opportunities to interline and partner more effectively with other carriers.

“We do very little interlining today, just out of our network to a couple of destinations,” Devereaux saide, citing Southwest Cargo’s current interline arrangements with Canada’s WestJet, and Hawaiian Airlines “It’s very manual and not scalable, but the new system will allow us to scale up these arrangements. With the interline capabilities, we fully intend to not only feed other carriers from our network, but also accept freight into our network from other carriers. I think we provide a pretty attractive option for those shipping into the United States simply because of the fact that we have close to 4,000 flights per day in the United States, a lot of redundancy in our schedule, a lot of point-to-point flying in our schedule, so we can reach a lot of markets very quickly.”

Speaking of schedule redundancies, during e-commerce panel discussions at recent air freight industry conferences, panelists have said Southwest’s unique cargo network could be adapted to handle express packages. (Perhaps even similar to 12Send, a recent partnership between Schiphol Airport, KLM and Parcel International, see link here).  Devereaux said Southwest was already engaged in e-freight shipments, as some of its customers, “are large players in the e-commerce space and are able to leverage our space and frequencies.”

Moving into 2017, Southwest plans to replace its some of its aging 737-300s with new -800s and MAX variants. When asked if he thought any of the -300s would be converted to freighter configuration, Devereaux unsurprisingly said, “that is not something we are considering.” Despite not operating freighters, Devereaux said cargo is still a consideration when choosing which aircraft to deploy on a certain route. He added, “There have been a few instances where Southwest’s cargo division has persuaded its network planning division to ‘upgauge’ from a -300 to a -800, because of very specific cargo needs in that lane.”