Southwest Airlines: Where is the LUV? Rivals have advantages as labour relations crumble

At the turn of the century it would have been heresy to describe Southwest Airlines as embattled. The venerable low cost airline was a perennial passenger favourite, and its employee relations were the most positive and successful among US airlines. But during recent years the company's admirable relationship with labour has soured, culminating in the recent declaration by Southwest's union leaders that the company's top two executives should vacate their positions.

The labour discontent and years-long negotiations have not only damaged management's credibility in the eyes of many employees, but have also prevented Southwest from taking important steps to create more outlets to generate revenue - including establishing potentially valuable codesharing relationships. As Southwest moves closer toward having the proper technology to support those partnerships, the likelihood that labour groups will approve codeshares is decidedly low as rifts between management and employees deepen.

Southwest had reached an inflection point in its frayed labour relations. Its golden image has tarnished, and the longer that contract talks drag on, the more that scrutiny over management's ability to mend the strained relationships will continue to intensify.