Southwest Airlines is taking legal action with the city of San Antonio as a long-term lease agreement goes into effect very soon. The airline wants the Alamo City to either undo or revise changes made in the agreement before they're set in stone.

Spurring On Change

Southwest Airlines has filed a lawsuit on Thursday against the city of San Antonio and San Antonio International Airport (SAT) Director Jesus Saenz. The Dallas-based airline is accusing the city and Saenz of discriminating against the company over "fundamentally flawed" airport terminal assignments. The new lease term is said to go into effect this Tuesday, October 1.

Originally, Southwest Airlines and the city of San Antonio reached an agreement to have the airline be moved to SAT's brand-new Terminal C, which is said to be twice as big as Terminals A and B combined. Southwest officials have claimed that the airport promised that once the new terminal was built most of all of Southwest's ten gates at the airport would move to the new terminal.

However, a change in the 10-year lease agreement, which Southwest officials claim is an "unlawful bait-and-switch," allegedly took place in May. The new terms reportedly state that Southwest would stay put in Terminal A at SAT, while other competing airlines would move into the new terminal. Both parties have since reached an impasse, and the lawsuit states that Southwest has no realistic option other than to turn down signing the new lease.

Southwest has been trying to get the lease deadline delayed and to have the original terms restored where they're guaranteed a large presence at Terminal C once again. The lawsuit is also requesting a judge to file a restraining order to keep seven airlines from entering the lease and taking Southwest's place at the airport.

On Tuesday, Mayor Ron Nirenburg and City Manager Erik Walsh went to Southwest headquarters in Dallas to meet with Southwest CEO Bob Jordan, COO Andrew Watterson, and a group of attorneys. 

While Southwest was threatening legal action if the lease deadline wasn't delayed, the city officials reiterated that Terminal C plans would be pushed back. Nirenburg and Walsh tried to convince Southwest to stay in Terminal A, assuring business will grow with a $200 million renovation, then later upping the amount to $300 million. The proposed Terminal A renovation plan would involve Southwest and the seven other airlines at the terminal paying 50% of the costs, while the city would pay for the other 50%.

Southwest officials wouldn't budge, citing that they needed to be sure that the investments to improving Terminal A will be "sufficient" enough. Officials have feared that staying in Terminal A over the long-term would be detrimental to the airline's growth at the airport. Both sides left the meeting without coming to terms on the agreement.
 

What This Means For Southwest

The new lease agreement is still going to move forward towards the October 1 deadline. If Southwest doesn't sign by then, the airline would be considered a "non-signatory airline" and receive an increase in leasing rates compared to the airlines that have signed.

Southwest, however, stated it's not interested in leaving San Antonio. Spokesperson Chris Perry had this to say about the airline's relationship with the Heart of Texas:

"Southwest Airlines values its relationship with San Antonio and remains hopeful that the airline and the City can agree on a plan that accommodates our future growth and treats us equal to the other carriers...We are encouraged by recent conversations with City leaders and look forward to reaching an expeditious and realistic solution."

Walsh sent a memo on Wednesday to verify that Southwest executives want to continue doing business in San Antonio and that additional meetings between the parties on Friday and next Monday weren't off the table.

Southwest's 18-page lawsuit is available to read online courtesy of San Antonio outlet KENS5.

Excluding the year 2020, San Antonio International airport attracts around 10 million passengers yearly, reaching an all-time high of 10.6 million in 2023.