All language subtitles for business wars

Speaker1:
It is the spring of 1966 in steamy San
Antonio, Texas, two men with booming voices

are talking business over whiskey at the bar
of the St.

Anthony Hotel. Thirty 35-year-old Rollan
King pushes his glass forward.

I'll have another Scotch rocks.

King runs an investment company and he's
drinking with Herb Kelleher, whose law firm

represents Kings business interests.

Kelleher taps his glass in the wild.

Turkey rocks for me, please.

Both men are tall and athletic and
transplanted to Texas.

King gets to the point.

I want to talk to you about this airline
idea we discussed the other day.

Oh, come on, Bill, let's not.

You've already gotten creamed in the airline
business.

Three years earlier, King bought Wild Goose
Flying Service and rebranded it Southwest

Airlines, the charter service shuttle, San
Antonio businessman around the state.

But it failed and King is salvaging what he
can.

After I ditch those Beechcraft, I want to
build an all jet service operation that will

compete with Braniff and Texas International
and American Airlines.

Kellers used to King's oddball business
ideas, but this one tops them.

All those fellows might give you a stake on
board, for their flights are canceled half

the time, and the other half they lose your
bag.

But what if we build an airline?

That'll be just for three cities.

San Antonio, Dallas and Houston.

Forget the stakes will be no frills.

We'll win on price, convenience and service.

Are you kidding me, Rollin?

The regulators will never allow air travel
in 1967 is in its golden age Mad Men, where

their best business outfits and sit in big,
comfortable seats as smiling stewardesses

serve plates of prime rib and refresh their
highballs.

Airlines can offer all this thanks to the
Civil Aeronautics Board.

The federal agency controls everything where
and what they can fly and what they can

charge for everything from a mixed drink to
a seat.

Most importantly, it allows airlines to
charge very high fares.

But King might have found a loophole.

There's this outfit, Pacific Southwest
Airlines.

They only fly intrastate only within the
boundaries of California.

That means that the feds have no
jurisdiction over them.

We can do that here in Texas, too.

But if we're going to get this thing off the
ground, I need you on board, Herb.

You're connected. What he means is that
Keller's wife is connected.

She's from one of the biggest landowning
families in all of Texas.

And that's saying something.

Rollin, Braniff and the others will flatten
you.

And how am I supposed to sell this to a
bunch of people who know their way around

money? Well, Herb, you're my lawyer, so you
figure it out.

Kelaher gulps the last of his drink.

As he walks away, he's thinking, no way this
airline is ever going to fly.

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to 500 500.

From Thundery, I'm David Brown, and this is
business was.

In our six part series, Southwest versus
American Airlines, we'll look at how the

bruising dogfight between the more
established airlines and the scrappy upstart

would not only change the way we fly, but
send some airlines crashing to their deaths.

You are listening to episode one, Clearing
the Runway.

Rollin King's phone is ringing, it's just a
few days after his meeting with Kelaher and

those many glasses of Scotch, Kelaher is on
the line.

I've been looking into your airline idea and
check in federal and state regulations.

And I got to tell you something.

Yeah. Herb, what is it? Rallen, you're
crazy.

Your airline idea is crazy.

Now, let's do it anyway.

Keleher sober as a judge days after that
hazy meeting at the St.

Anthony Hotel Bar is finally convinced that
King is right.

If a low cost, low frills carrier can
operate without interference from federal

regulators in California, then they can do
the same in Texas.

And if the fares are cheap enough, Kelaher
figures Texans would rather fly than drive

long hauls between Texas cities.

First, though, Kelaher has to convince some
of the state's richest men to invest in air

southwest. That proves to be easier than
expected.

The investors agree that there's a need in
the Texas market for what he's proposing.

They also like the idea of owning a company
that flies jets.

Plus, everyone really likes Herb, who's
always ready with a wisecrack in whiskey.

Kelaher starts looking for backers by
calling John Merchiston, co-founder of the

Dallas Cowboys and an old pal.

Hello. Hey, John, it's Herb Rollin King.

And I have this idea for an airline, sort of
a commuter airline for Texas, all jets, all

intrastate, no federal interference.

Dallas, Houston, San Antonio with very
frequent low fare flights.

We're raising money. You interested?

Hell yes. Herb Ivone in Beijing and Kelaher
bring on some of the biggest names in Texas

business. They raised five hundred forty
three thousand dollars and incorporate on

March 15th, 1967.

About a year later, the Texas Aeronautical
Board certifies air southwest to fly within

Texas. But the next day, four major airline
competitors launch a legal assault to stop

that from happening. Apollo 10 is
transmitting

the first color pictures of Earth from space
before landing on the moon as protesters

occupy the streets.

President Nixon pledges to bring back 25000
troops from Vietnam.

A confrontation between gay rights activists
and police outside the Stonewall Inn, a gay

bar in Greenwich Village, New York City,
escalates into a riot.

Excuse me. And at a farm in Bethel, New
York.

The Woodstock Music Festival features
legendary acts of Santana, the Grateful Dead,

Janis Joplin

And Jimi Hendrix.

These events helped define an era and they
also speak to the mood in the country.

People want to throw out the rules and
challenge the establishment.

In some ways, it's the perfect climate for
an upstart like Southwest, if only it can get

in the air. It's been grounded for more than
a year, thanks to the lawsuits brought by

Braniff, Trans Texas and Continental.

They have plenty to protect to.

Braniff Airlines has a monopoly on flights
between the big cities in Texas.

Texas International dominates air service
between smaller cities and continental flies

wherever the other two don't.

They're all hemmed in by federal regulation,
but not air southwest.

With that advantage, Southwest should be in
a position to soar past competitors.

That would be a whole lot easier if
Southwest actually had some planes to fly.

Trouble is, the airline is burned through
most of its half a million in seed money

fighting lawsuits. King summons his board
for a meeting.

The mood is glum.

John Merkerson speaks first.

Gentlemen, we fought a good fight, but these
other airlines are set on bleeding us to

death and we don't have much blood left.

Most in the room nod in agreement.

Kelleher does not listen.

Everyone, I know this looks bad, but this is
a legal battle.

I'm convinced we can win on appeal and we
need to win.

All we're trying to do is offer Texas
superior air transportation at a low price.

Kelaher knows he's asking his backers to buck
the establishment to break the airline's grip

on Texas. But that's the zeitgeist in
America at the time.

Our competitors think thing tied up with
lawsuits.

That's a perversion of what America's
supposed to be about.

I want free enterprise to work.

I want to win.

Now, if you agree to let me keep trying, I
work for free.

I'll pay the court costs right out of my own
pocket until we do win the board votes.

Air Southwest will fight 18 long legal
months later, Kelaher wins a ruling from the

Texas Supreme Court.

The bigger carriers appeal to the U.S.

Supreme Court, but in December 1970, it
declines to overturn the Texas ruling.

Southwest wins.

It's a remarkable legal battle, but it could
be a Pyrrhic victory.

Southwest has one hundred forty three
dollars in the bank and owes more than

hundred thousand dollars.

Still, it is in business, at least
theoretically.

They need a team. The recession of the 1970s
put a lot of good people out of work and word

is out that Southwest is open for business.

By January 1971, Lamar MEUs, an airline
industry veteran, is president of Air

Southwest. Mieux, puts fifty thousand
dollars of his own cash into the company and

raises more than two million dollars.

He also renamed the company Southwest
Airlines.

And then the mad dash begins.

It's early spring of 1971, Southwest is
supposed to launch its first flight within

two months, a mechanic has just arrived at
his new job, having just been laid off like

many early Southwest employees by bankrupt
Purdue Airlines, the mechanic and a team are

trying to open the doors at the lone hangar.

Southwest is leased at Love Field.

The company made a strategic decision to
operate from a not so busy airport, just a

short drive from downtown Dallas.

What in the world?

The hangar is a relic from the 1940s.

The mechanic is pushing on the doors, but
they don't budge.

This thing is rusted shut.

The tracks are full of sand.

It takes two days to pry open the building's
40 foot tall doors.

Meanwhile, another former Purdue airline
employee is having a different kind of

problem training stewardesses.

There aren't any.

So Muse runs a print ad aimed at a woman
Playboy has been pursuing for years.

It's titled An Open Letter to Raquel Welch.

The newspaper ad reads, Miss Welch, you
typify the girls.

We're looking for warm, personable and great
looking and hot pants if you know of any

other girls like you.

At least 20 years old.

20/20 vision without glasses between five
two and five seven one hundred to one hundred

thirty five pounds who are high school
graduates, preferably with college training.

Would you please ask them to send us a brief
statement of qualifications and a recent

photograph? 100 applications pour in for
just 38 available jobs.

On June 15th, 1971, Muse meets with a
reporter to crow about what they've

accomplished within just three months, we
bought three planes, leased gates at three

airports, contracted with jet fuel and other
supplies, launched an ad campaign and hired

and trained 21 pilots, 40 to support
personnel, nine ramp agents and 38 hostesses.

And I'm probably forgetting something that's
impressive.

But what are you planning to do about the
new restraining order that Braniff has

obtained against you, huh?

What restraining order?

The one that says you won't be allowed to
fly on June 18th.

This is breaking news to the Southwest
president.

He abruptly ends the interview and speeds to
love Field, where Kelaher will be arriving

from Washington before flying on to San
Antonio.

He spots Kelaher in the crowd and rushes to
her.

You've got to get to Austin. There's another
injunction and we go into service on the

18th. What?

I don't even have a change of clothes,
Lahmar.

OK, fine.

I need to get a ticket on Braniff to Austin.

No, you don't. One of our planes is on the
tarmac right now.

You get on that wheel, route it to Austin,
get yourself in front of the Supreme Court

there and come up with some damn thing to
tell them.

OK, Lamar, I'll figure it out.

I hope you will. But Herb, if it doesn't
work, if the sheriff shows up here on the

18th with some kind of restraining order,
what do you recommend we do?

Lamar, if the sheriff shows up, you push
that first flight out on top of him, roll

right over that son of a bitch and leave
tire marks on his back.

It's been four years.

This is going on long enough.

Just get the damn plane in the air.

After a night at the law library, Keller
doesn't come up with much legal fodder.

So he just reminds the court that they've
already ruled in Southwest's favor.

That works.

19 hours later, the captain and first
officer are shaking hands with Dallas deputy

mayor on the tarmac at Love Field.

This is all the pomp and circumstance the
inaugural flight will see.

There are no marching bands, no banners, no
champagne corks popping, but also no sheriff,

three flight attendants aboard the Boeing
737.

They're just two paying passengers and one
piece of checked luggage in the cargo hold.

The near empty plane takes off at seven a.m.

right on time.

Southwest Airlines is finally aloft.

The owners and crew are ecstatic, but the
excitement is short lived.

It won't be long before the airline hits
serious turbulence.

Speaker2:
Hi, I'm Brooke, and I'm Erica and where the
hosts of Even the Rich, so I want you to

imagine you're about to go on stage and
perform in front of 30000 cheering fans.

You, papa, cough, drop, take some deep
breaths.

Tell yourself you can do this.

And that's when your brother steps into your
dressing room.

He tells you the police are here.

Either you clean up your act or you'll get
arrested.

Oh, wow. OK, yeah.

But you just laugh and say good, because the
you in this story is Madonna.

You're going to give the police a moment
they'll never forget.

Oh. So what happens next?

If you want to find out, you'll have to
listen to the newest season of Even the Rich,

The Making of Madonna.

Follow an Apple podcast, Amazon Music, The
Wonder App or wherever you're listening right

now, join Wonder E-Plus in the Wonder app to
listen ad free.

Speaker3:
I'm Marcus Lemonis and I run a multibillion
dollar company.

I also hosted one of the most successful
business shows on TV on my new podcast, 100

Percent. I'm going to talk with exceptional
entrepreneurs about their businesses and how

they got started. It's a little bit of
master class, a cocktail party and a Sunday

drive all wrapped into one on this show.

I'm going to dig deeper to uncover the
stories behind these companies.

And my celebrity friends will drop by for
some inspiration and some advice.

Kristen Bell, Gayle King, Howie Mandel,
Charles Barkley, Jillian Michaels and a bunch

more. So join me on this journey each week
as we meet some of the most creative,

innovative, passionate minds in business
that's doing things my way, 100 percent, 100

percent. With me, Marcus Lemonis is
available on Apple podcasts, Amazon music, or

wherever you get your podcasts.

Speaker1:
It's the Sunday after the inaugural flight,
and Rollin King is in the co-pilot seat for

the first morning flight from Love Field to
Houston, one three zero zero zero cleared for

takeoff over Muse's three month sprint to
get Southwest Airlines operational.

King has changed titles to allow news more
freedom to run the company as he sees fit.

King is no longer CEO, but executive vice
president of operations and a board member on

Executive 651.

He's also become certified to co-pilot, a
737 and has decided to work on a regular

flight crew. Thirty six King sitting in the
first officer seat, flips a couple of

switches and the Pratt and Whitney engines
spin to row roar.

In the early morning Texas heat, the ground
crew guides the plane to the runway.

The pilot pushes the throttle forward and
the plane speeds ahead.

King calls out the pre-flight checklist to
the captain Rusick, 80, not the one rotate.

The flights in the air, so the plane is
yanked to the right like a dog on a leash.

King shouts reverse thruster deployed and
it's creating a huge aerodynamic drag on one

side of King's plane.

It's like having one engine push forward
while the other pulls it back.

If the thruster can't be closed, the plane
can't climb the pilot, contact the control

tower. Mayday.

We've got a malfunctioning thruster.

Can you please clear runway?

The plane turns back quickly, land safely.

And no one has heard the reverse thrusters
checked.

It was deployed during maintenance the night
before, closed manually and not fully locked

in place. It is an inauspicious start,
Southwest's director of flight operations, an

American Airlines veteran, responds by
ramping up all the airline safety procedures.

Just months after King scare in August of
1971, MEUs King and the board meet to vote on

a plan to accept delivery of a fourth Boeing
737 200.

Boeing is giving them a million dollar break
on the plane, as it did with the airline's

first three planes, but it's still a big
risk for a money losing air carrier mieux

pushes the long view.

We're losing money at this point, but a
fourth aircraft at a cost of four million

dollars will allow us to offer more frequent
service between Dallas and Houston.

These men are pretty unflappable, but one
oil man is shaking his head.

We're losing our shirts already, Lamar.

We're averaging 17 passengers per flight at
20 dollars per passenger.

We need 38 paying customers on each flight
to break even.

But we can't even do that.

And now you want to buy another plane?

Man, it makes no sense.

I won't be a party to it.

The rest of the board likes the idea of more
frequent service and votes in favor of buying

the new plane. The oil man, which the board,
the fourth plane arrives in October.

Southwest's finances immediately go into a
tailspin.

There just aren't enough passengers to cover
the costs of four planes by April 1972.

The situation is dire.

Mieux comes up with a desperate solution.

Southwest can sell one plane to make
payroll.

It can serve its current schedule with just
three planes if it can turn its planes at the

gate, meaning unload passengers, then load
new passengers and refuel much faster.

How fast? Ten minutes.

Other airlines, after a whole lot of
tinkering, have whittled their turnaround

time down to 25 minutes.

Everyone is thinking the same thing.

It's impossible.

Bill Franklin, the airline's gruff forty
five year old vice president of operations,

believes it can be done.

He explains his plan to an incredulous
ground crew.

OK, our planes will pull up near the gate,
but far enough away that they can simply

drive away without being pushed by a tug.

Instead of gate bridges, passengers will
board and deplane using stairs at both the

front and the rear of the plane.

Departing passengers will be lined up on the
tarmac even before the plane arrives.

So soon as one group gets off, another one
gets on.

Bags will be unloaded and reloaded.

Even before all the arriving passengers are
off the plane, tires and systems will be

checked while fuel is being added.

And as soon as the last new passengers on
board, whether they're seated or not,

hostesses will close the cabin doors and the
plane will taxi.

Bill, that's insane.

There's no way all of that can be done in
ten minutes.

Oh, yeah. Well, if you can't turn these
planes in ten minutes, I'm going to fire all

of you. Then I'll go out and hire another
group of guys.

And if they can't do it, I'll fire them,
too.

I'll keep on firing people until I find
someone who can do it.

This is the only way to save Southwest
Airlines.

Ladies and gentlemen, Southwest Airlines
welcomes you to Houston, will be at our gate

momentarily. There will be two stairwells
today that you'll use to deplane.

One is at the front of the aircraft, the
other at the rear.

There's a moment of confusion among
passengers who aren't accustomed to exiting

in two directions.

OK, so here's your bag head.

Right that way. Sandra, I've got to get
these seats cleaned.

Can can you get those seat belts crossed?

Captain, can you toss this trash in?

That being passengers get off in record time
and so do the passengers getting on.

Within weeks of nailing that 10 minute turn,
Moos checks the stats on line departures are

improving. Its first flight had two
passengers by the end of 1972.

The airline board's 300000 passengers.

Southwest is finally on a clear path toward
profitability.

Its rivals see the threat Southwest poses
and begin circling the fledgling airline

looking for its weak spot.

They know Southwest's reserves are growing,
but the company still can't match their war

chests. On the next episode, Southwest's
competitors try to shoot their new rival out

of the sky with rock bottom fares.

Southwest's response?

Well, let's just say for a while, Southwest
Airlines was fueled by booze.

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A quick note about the conversations you've
been hearing.

We can't know exactly what was said, but
this dialogue is based on our best research.

I'm your host, David Brown.

Joseph Quinto wrote this story.

Karen Lowe is our senior producer and
editor.

Ginny Louris, our producer, sound design by
Bay Area Sound.

Our executive producer is Marshall Lui.

Our program was created by Ernan Lopez for
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Speaker4:
Hey, they're wondering, listeners, this is
Justin Long and I host another one free

podcast called Life is Short with Justin
Long with my brother, Christian Long.

Anyway, each week I talk with celebrities,
musicians, actors, all different types of

artists and thinkers about how they get the
most out of life.

And I ask the really hard hitting questions
like, what is your favorite emoji or what

snack food would you eat for the rest of
your life?

But seriously, we do sometimes get real on.

Life is short. We get into it, we get a
little real, we get in depth and it's a lot

of fun. Over the past two years, we've had
some amazing guests on the show, like Matthew

McConaughey s Wrightman.

He talked about his book.

He talked about how he just keeps living.

We had Kristen Bell, who I don't do an
impression of, but I love and I'm sure you

do, too. We had Anthony Mackie, Vince Vaughn
and many more.

Listen to the latest episode of Life Short
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