The nearly two-year dispute between the San Antonio airport and its biggest carrier has come to an end.
On Thursday, officials with the San Antonio International Airport (SAT) and Southwest Airlines released a joint statement saying they had reached a settlement over the lease and use agreement and the new terminal project.
The signed settlement agreement obtained by the San Antonio Report gives Southwest what it wanted in the first place — guaranteed access to a new terminal when construction is completed in 2028.
The city also gets what it is owed in airport use fees and a long-term commitment from Southwest.
“What we have done here is give everybody a win-win situation,” said Director of Airports Jesus Saenz. “We all want what’s best for the city, for this airport and for this region. Southwest has had a very long presence here in San Antonio, and we want that to continue, and they want to continue that as well.”
In September, Southwest Airlines lost its year-long lawsuit over the City of San Antonio’s decision to leave the airline out of its new $1.4 billion San Antonio International Airport terminal.
Southwest filed the lawsuit in September 2024 after the city announced that Delta Airlines, American Airlines and other international carriers would be housed in its planned new Terminal C.
But Southwest would stay in aging Terminal A, slated for $200 million in upgrades sometime after 2028.
Southwest responded by saying the airport was using subjective criteria to choose carriers for the new terminal, against rules of the Federal Aviation Administration, and discriminating against the airline.
The Dallas-based, low-cost carrier also declined to join other major airlines in signing a new lease agreement.
Southwest, which regularly accounts for more than one-third of the passengers who use the San Antonio airport, appealed the judge’s decision. Since then, the case has been delayed by both parties agreeing to extensions.
In early December 2025, city officials and Southwest representatives met at U.S. Department of Transportation headquarters in Washington, D.C., to work on resolving the issue.
More recently, in April, the city filed another motion for more time on the case, allowing for settlement talks to continue.
Under construction since late 2024, the $1.68 billion new terminal is expected to be completed in 2028, increasing the existing airport’s 27 gates to 40.
Design renderings show a bright and modern airport terminal bigger than, at 850,000 square feet, SAT’s two existing terminals combined, with spacious waiting areas and 29,000 square feet of club lounge space, and an open-air courtyard.
The new terminal is the city’s costliest development project to date and also the most expensive component of the 20-year, $2.5 billion airport strategic development plan approved in November 2021.
Settlement documents state the airport’s new lease and use agreement with Southwest assigns six gates to the airline in Terminal A until it can be relocated to the new Terminal C facility.
Southwest then will be assigned three gates in Terminal C (at C18, C14 and C13) and three gates in Terminal B (at В3, B5 and B7), which it will share with United Airlines.
The two terminals will be connected and a concourse built to link them with Terminal A.
An illustration in the agreement documents shows four of the new terminal’s 18 gates assigned to Delta, six to American, three to Southwest, four unassigned, and one designated for the City of San Antonio. That leaves the airport with flexible “common use” gates for future growth.
“In the everyday world of airports, there is always a gate management plan in place where we are constantly working to make things happen,” Saenz said. “So we have to have the ability to shift aircraft around and … as we launch new air service, we’ve got to have space available for those opportunities.”
Both Delta and American are moving forward with their development of lounges in Terminal C, he said.
Assistant City Manager Jeff Coyle also called it a mutually advantageous settlement.
“They wanted a presence in the new terminal, they’ve got it,” Coyle said. “We wanted our largest carrier to be signed on to the long-term to help support the expansion.”
The 15-year lease agreement is a $3 million commitment from the airport’s signatory carriers, or major airlines, and Southwest’s portion of that is about one-third of that amount, he said.
To resolve the payment dispute over gate fees Southwest owed the airport, both parties agreed to a compromise that splits the difference.
The legal agreement calls for Southwest to make up for the difference between what it would have paid in fees as a non-signatory airline starting in October 2024 to now — a higher fee — and the amount it would have paid if it had signed the initial use agreement.
Southwest has agreed to forego the revenue sharing that signatory airlines participated in during that period and the city has agreed to allow Southwest to pay the lower rates that signatory airlines paid during the past 18 months.
Airport officials say a new facility planning study will be undertaken to accommodate Southwest.
Southwest will be included in discussions related to the study, according to the agreement, along with planning for the renovations in Terminals A and B.
“We have a lot of work to do in Terminal A,” Saenz said. “We want the passenger experience to be the same in all of our terminals.”
He plans to give a briefing to City Council about terminals A and B in the coming week.
