Southwest Airlines Loses Bid to Maintain Lease at San Antonio Airport
On September 30, a U.S. federal judge ruled against Southwest Airlines’ request to keep its expiring lease agreement with San Antonio International Airport (SAT) in place, marking a significant turn in an ongoing dispute regarding future terminal locations and gate allocations. The airline sought an injunction to extend the current contract while it pursues a federal lawsuit against the city of San Antonio.
Effective October 1, Southwest Airlines will no longer operate under the existing lease, which has now been signed by eight other airlines, including American Airlines and Delta Air Lines. These airlines have agreed to a new 10-year lease that outlines gate assignments and costs, set to take effect as planned after Judge Xavier Rodriguez’s ruling.
If Southwest chooses not to sign the new agreement, it will have to operate as a non-signatory airline at SAT, a situation that is unusual for an airline with such a large presence. Currently, Southwest commands nearly 40% of the market share at SAT, and the carrier had anticipated being part of the new 17-gate, $1.7 billion Terminal C, which is scheduled to open in 2028. However, SAT has assigned Southwest to remain in Terminal A, which is currently undergoing renovations.
Despite approximately $200 million being invested into improvements at Terminal A, Southwest argues that these renovations will not meet its operational needs compared to the new Terminal C, where American and Delta will be located. The new terminal will cover more than 850,000 square feet, featuring 41,000 square feet of concession space and 29,000 square feet dedicated to premium lounges.
In its federal lawsuit, Southwest claims that the airport assured it that the majority of its 10 gates would be located in Terminal C by 2028. The airline contends that SAT “unjustly discriminated” against it by allowing American and Delta access to the new terminal while relegating Southwest to the older Terminal A. This decision, Southwest argues, effectively gives it a secondary status at the airport, despite the fact that it has served SAT for 53 years.
If the airline does not sign the new lease, it would operate under non-signatory status, which could result in increased operational costs and a lack of long-term guarantees for both the airline and the airport.
In response to the ruling, San Antonio City Manager Erik Walsh stated that the court’s decision to deny the injunction was made after careful consideration. He added, “Southwest’s customers are our customers, too,” indicating that plans for the transformation of Terminal A would begin immediately.
A Southwest spokesperson noted that while the judge did not rule on the merits of the case, the airline does not intend to sign the new lease agreement in its current form. “We believe the city’s gate-allocation methodology discriminated against Southwest,” the spokesperson remarked, expressing hope for a thorough discovery process in the ongoing federal lawsuit.
Southwest Airlines emphasizes its desire to maintain a strong relationship with San Antonio, stating that it seeks a plan that accommodates its future growth and treats it equitably with other carriers. The airline’s historical connection to San Antonio—where it was founded in 1967—underscores the significance of this ongoing dispute. As the situation unfolds, both parties hope to find a resolution that upholds the long-standing relationship and benefits travelers in the region.
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