Southwest Kicks Off a New Era With International Flights

Get ready for the new Southwest Airlines, which isn't only the largest U.S. domestic carrier, but an airline that flies internationally, too.

Southwest kicks off its international service July 1 with a flights from Baltimore Washington International Airport to Aruba and Nassau; Atlanta to Aruba and Montego Bay, Jamaica, and Orlando to Montego Bay.

Bolstered by the AirTran acquisition and a new international reservations system built by Madrid-based Amadeus, Southwest plans to add service to Cancun and Los Cabos in August, and Mexico City and Punta Cana, subject to government approval, in November.

Southwest has grand international ambitions, and could be flying to 50 cities beyond the continental U.S. over the next decade, possibly as far as northern destinations in South America.

In a CNBC interview, Southwest CEO Gary Kelly says the airline will build a five-gate international terminal in Fort Lauderdale.

By late 2015, Southwest will operate out of four of the five gates at a new international terminal at Houston Hobby.

The 700-aircraft Southwest will be adding long haul 737s, and could order an additional 100 planes over the next 10 years to handle international and other expansion.

Through AirTran, international service only accounts for 2% of Southwest's system today, but that will clearly be increasing.

And, so far at least, the first two bags on these flights are flying free.