Business Wars

Everyone loves Herb Kelleher—even FAA regulators. The onetime corporate counsel-turned-CEO is coming into his own at the helm of Southwest. But his latest challenge is coming up with a way to skirt the FAA’s pesky “slot” system, designed to limit air traffic by rationing takeoffs and landings. Kelleher has a business to run. So he embarks on a crazy plan to snag a few extra slots for Southwest. It may not work, but one thing’s certain: it will be a whole lot of fun. 

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As deregulation dawns, Southwest Airlines’ founder and CEO are locked in a power struggle. In the middle is Herb Kelleher, Southwest’s corporate attorney. And after 18 months serving as a punching bag for the company’s top brass, he’s had enough. 

But as Southwest deals with a succession crisis, American Airlines is facing another emergency. It needs money, fast. The company is cash-poor after investing in its proprietary online reservation system, SABRE. The situation is so dire CEO Al Casey turns to a drastic option — moving the company’s headquarters from its homebase in New York City to Dallas. 

Just as American is getting a financial lift, Southwest takes a nosedive. Deregulation has the company eyeing expansion routes, but the powers that be will do anything to stop it. 

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The computer age is on the horizon, and American Airlines has a secret weapon: SABRE. Sure, the airline is top of the heap under the current pen-and-paper reservation system — the one where travel agents use a massive phonebook to look up flights, then call individual airlines to book a ticket. But they’re tired of playing phone tag. The American Society of Travel Agents has plans to roll out a new electronic system, one that could force American to lose its unofficial preferred status. The company has to get its system to market first — and its leaders have to convince the travel agencies to get onboard. 

But there’s a much bigger threat looming on the horizon, one that could give a big boost to upstart rivals like Southwest Airlines. Deregulation is coming, and when it does it will change everything. 

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Baniff and Southwest battled in court for domination over the skies. Southwest came out on top for a little while, but Baniff pushed back with prices Southwest just couldn't beat. The only way Southwest could fight back was to give the mostly male, mostly businessmen clientele something they couldn't refuse: free booze. For the first time ever, Southwest is in the black. With Baniff tamed, there's more turbulence. This time, it's a national airline. American Airlines is here to play.

Please note, this episode originally aired in 2018.

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In Texas in the 1960s, Rollin King had a crazy idea. He wanted to create a no-frills airline service that served San Antonio, Dallas and Houston. All he and his lawyer had to do was convince the Federal Regulations Bureau that they had no jurisdiction on flights that never left Texas. Of course getting Southwest off the ground would have been a lot easier if they had any planes…

Please note, this episode originally aired in 2018.

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In the wake of the unexpected jolt of the COVID-19 pandemic, food delivery app businesses are looking for stability and profitability any way they can find it. With Uber’s purchase of Postmates and DoorDash buying Caviar, consolidation has become all the rage. 

And the apps are diversifying into prescription fulfillment, groceries, and third-party logistics. But the razor-thin profit margins, rising costs of doing business, and withering relationships with labor and restaurants are taking their toll.

We’re joined by Preetika Rana, a technology reporter at The Wall Street Journal to discuss how these app companies plan to be the last one standing in the food fight.

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It's July 2019. DoorDash is finally bigger than Grubhub, but it's coming under fire for pocketing tips from its drivers. Now DoorDash needs to rehab its image, or risk losing customers to its competitors. 

When a California proposition threatens to alter how food delivery companies classify their drivers, DoorDash and Uber join forces to fight it. Six months later, the pandemic marks a boon for food delivery companies, but can the boost last?

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It's December 2014, and Grubhub's Matt Maloney is feeling the heat. Competitors are eating away at his market share, so he decides to change direction. Grubhub finally starts delivering food with its own drivers. But will it be enough to outpace the other fast-growing upstarts?

DoorDash, meanwhile, struggles to raise funds at a steep valuation. And the company comes under fire for some less than savory business practises. Postmates has cornered the high-end market and Uber Eats expands from an Uber feature to a standalone app. But angry drivers threaten the entire food delivery business model. 

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It's 1990 in Champaign, Illinois, and 15-year-old Tony Xu is washing dishes in the Chinese restaurant his mother manages. He wants to help people like his Mom, but it'll be many years before he hits on his solution for small businesses. 

Across the Atlantic, Bastian Lehmann forgets his snowboard while moving house. He can't find a way to get it shipped to him cheaply, and the idea for Postmates is born. Meanwhile, Grubhub founders Matt Maloney and Mike Evans have decided local pizza should be as easy to find online as apartments. And eventually, Uber’s Travis Kalanick will recognize that food delivery is the next logical step in his booming transport empire.

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It's December 2011 in San Francisco. Bastian Lehmann is getting ready to launch his courier app, Postmates. But when he and his co-founders discover people want food delivered, not objects, they pivot to a business already cornered by Grubhub. 

Meanwhile, 30 miles away in Palo Alto, a business school student called Tony Xu is trying to figure out how to help a small macaroon shop fulfill delivery orders. His solution? DoorDash. Along with UberEats and Postmates, it will help pioneer the gig economy—and change the restaurant business forever. 

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