Southwest Airlines: Experiencing Turbulence

Shares of the Dallas-based airline might look attractive at current levels, but before you take a flier, remember it's in an industry that has a history of giving investors a case of air sickness.

Every budget traveler has been there. Queued up at the gate, waiting for the flight attendant to call your letter. Passengers asking you if they are in the right line, others trying to cut in. If you're lucky enough to have an "A" on your ticket, you get the run of the whole plane. Take a window seat or plop down in a chair with some extra leg room by the aisle. If you are among the poor unfortunates in the "C" group, expect to be wedged in a middle seat between two obese passengers or left with a spot in the stinky row of seats next to the lavatory in the rear of the plane. Cruel, efficient and profitable -- we all know the cattle call at Southwest Airlines.

Complain about the no-frills service if you must, but Southwest is the best-run airline in the business. The ruthless boarding procedures allow Southwest employees to turn planes around faster, which translates into more flights per day than their competitors. While its rivals wallow in red ink, battle with bankruptcy court or issue a "passenger bill of rights," Dallas-based Southwest squeezes out profits year after year, even during the industry's turbulent patch after the September 11 terrorist attacks.

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Contributing Editor, Kiplinger's Personal Finance