Southwest Airlines 2013 Annual Report Download - page 45

Jackson Atlanta International Airport and Orlando International Airport. AirTran also leases a warehouse and
engine repair facility in Atlanta. During 2013 the Company completed construction of a new, owned, energy-
efficient, modern building designed to house certain operational and training functions, including its 24-hour
operations. This additional headquarters building is located across the street from the Company’s current
headquarters building on land owned by the Company. Construction was completed in late 2013.
As part of the Company’s expected future international service, the Company has agreed with the City of
Houston (“City”) to expand the existing Houston Hobby airport facility. Pursuant to the agreement, the Company and
the City have entered into an Airport Use and Lease Agreement to control the execution of this expansion and the
financial terms thereof. This project provides for a new five-gate international terminal with international passenger
processing facilities, expansion of the existing security checkpoint, and upgrades to the Southwest ticketing counter
area. Construction began during third quarter 2013 and is estimated to be completed during the second half of 2015.
Additional information regarding this project is provided below under “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” and in Note 4 to the Consolidated Financial Statements.
In December 2013, the Company entered into an agreement with Broward County, Florida, which owns
and operates Fort Lauderdale-Hollywood International Airport to oversee and manage the design and
construction of the airport’s Terminal 1 Modernization Project. In addition to significant improvements to the
existing Terminal 1, the project includes the design and construction of a new five-gate Concourse A with an
international processing facility. Construction is expected to begin in 2014. Additional information regarding this
project is provided below under “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” and in Note 4 to the Consolidated Financial Statements.
During 2008, the City of Dallas approved the Love Field Modernization Program (“LFMP”), a project to
reconstruct Dallas Love Field with modern, convenient air travel facilities. Pursuant to a Program Development
Agreement with the City of Dallas and the Love Field Airport Modernization Corporation a Texas non-profit “local
government corporation” established by the City of Dallas to act on the City of Dallas’ behalf to facilitate the
development of the LFMP), the Company is managing this project. Major construction commenced during 2010.
New ticketing and checkin areas opened during fourth quarter 2012, and 11 new gates and new concessions opened
in April 2013. Another new gate opened in July 2013, and full completion of the project is scheduled for second half
2014. The project consists of the complete replacement of gate facilities with a new 20-gate facility, including
infrastructure, systems and equipment, aircraft parking apron, fueling system, roadways and terminal curbside,
baggage handling systems, passenger loading bridges and support systems, and other supporting infrastructure. The
LFMP is discussed in more detail below under “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” and in Note 4 to the Consolidated Financial Statements.
As of December 31, 2013, the Company operated seven Customer Support and Services call centers. The
centers located in Atlanta, San Antonio, Chicago, Albuquerque, and Oklahoma City occupy leased space. The
Company owns its Houston and Phoenix centers. The Company opened its new expanded Customer Support and
Services center in San Antonio in June 2012, replacing an older facility and creating more than 300 local jobs. In
2013 the Company consolidated its former Atlanta, Savannah, and Carrollton, Georgia call centers into a new
Atlanta call center, located in leased space.
The Company performs substantially all line maintenance on its aircraft and provides ground support
services at most of the airports it serves. However, the Company has arrangements with certain aircraft
maintenance firms for major component inspections and repairs for its airframes and engines, which comprise the
majority of the Company’s annual aircraft maintenance costs.
Item 3. Legal Proceedings
A complaint alleging violations of federal antitrust laws and seeking certification as a class action was filed
against Delta Air Lines, Inc. and AirTran in the United States District Court for the Northern District of Georgia
in Atlanta on May 22, 2009. The complaint alleged, among other things, that AirTran attempted to monopolize
air travel in violation of Section 2 of the Sherman Act, and conspired with Delta in imposing $15-per-bag fees for
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