Case | HBS Case Collection | November 2006 (Revised March 2010)

Two Ways to Fly South: Lan Airlines and Southwest Airlines

by Ramon Casadesus-Masanell, Tarun Khanna, Jorge Tarzijan and Jordan Mitchell

Abstract

To maximize their effectiveness, color cases should be printed in color. Looks at the different business models of two highly successful and profitable airlines: Chilean-based Lan Airlines and U.S.-based Southwest Airlines. Lan Airlines pursues a hub-to-spoke international full-service model where passenger and cargo operations are highly integrated. Southwest, on the other hand, is set up for a point-to-point, low-fare, "no frill's" service with a homogenous fleet. Designed for a course on the design of business models. Includes color exhibits.

Keywords: Business Model; Service Operations; Competitive Advantage; Air Transportation Industry; United States; Chile;

Citation:

Casadesus-Masanell, Ramon, Tarun Khanna, Jorge Tarzijan, and Jordan Mitchell. "Two Ways to Fly South: Lan Airlines and Southwest Airlines." Harvard Business School Case 707-414, November 2006. (Revised March 2010.)