#35 William Swelbar: How Airlines Became the Ultimate OR Playground

Yeah.

I, you know, it was, uh, believe it or not, it was the Jimmy Carter administration that deregulated the industry.

Um, and, uh, you know, it was at a time when, when air travel was very expensive.

You know? It was only enjoyed by those, uh, of relative wealth.

Um, and, uh, you know, the view was is that, um, you know, it, it, the industry was, uh, highly regulated, and it was a, it was a, an agency called the Civil Aeronautics Board that, uh, was, was responsible for assigning TWA the ability to fly between Minneapolis and Las Vegas.

And the government would pick and choose which airlines would fly where.

The government was involved in pricing.

And deregulation was all about overnight freedom of entry and exit, and the ability to price, you know, based on, you know, your, your, your cost structure and how it is that you would compete.

And, uh, so for the first through 1985, the Civil Aeronautics Board remained around, but it was more to just kinda oversee a few things, uh, its sunset.

Um, and, uh, you know, it was, the goal was to democratize air travel.

Um, you know, when you think back to where we were in 1978, um, you know, on a per capita basis, probably, you know, it was about 1.5 passengers, 1.5 trips per capita took place.

Um, by the time where it is that we sit today, the, uh, average consumer or the average number of trips is five.

Um, and so yes, the, uh, we truly democratized travel.

You know, up and down nearly 85% now of the population has flown at least one time.

Um, and, uh, yeah, I mean, it, it, it did what it is it needed to do.

It was not without a lot of tumult, um, and, uh, you know, disenfranchisement and, you know, some really rough roads, but, um, yeah, it's been a, it was an amazing industry to get to grow up in, to be in the middle of, um, you know, because it's impacted by the economy, it's impacted by politics, it's impacted by the weather.

I mean, you know, nothing's predictable.

And, and so, yeah-

Right

...

I mean, it was just, just a, a really cool industry to learn, um, in an industry that absolutely was required to remain agile and nimble and innovative in order to live to fight another day.

Um, and that's why we're here.

Let's drill down on that.

So suddenly, you're saying, Bill, overnight airlines could choose their own routes, set their own prices.

So, so what changed right away, and, and what was the most surprising thing that was happening back then?