> And since Southwest can't grow by adding capacity to current routes (we kn... | Hacker News

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		ryanricard on Sept 29, 2010 \| parent \| context \| favorite \| on: Southwest's acquisition of AirTran: Why they're do... > And since Southwest can't grow by adding capacity to current routes (we know the negative cycle that creates), they must find new markets. I don't think I "know the negative cycle that creates." Could I trouble someone to explain it to me?

pchristensen on Sept 29, 2010 [–]

I'm guessing higher capacity => over supply => loss of pricing power => lower revenue and higher costs

dartland on Sept 29, 2010 | [–]

Exactly.

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