The company is now upgrading its reservation system to accommodate all the new international flights. With its purchase of AirTran ( AAI), Southwest also will inherit a Bermuda service beginning next spring, if the merger is approved. The longer-range plane will enable Southwest to extend its route network to Hawaii, Alaska, Canada, Mexico, Central America and the Caribbean. The first delivery of the 737-800s is scheduled for March 2012.
In a speech to the Wings Club, an aviation group, Kelly announced that Southwest plans to substitute 20 of the 737-700 aircraft it has ordered from Boeing ( BA) with longer-range 737-800s. We ought to be able to modernize our air-traffic-control system." Kelly also supports the use of alternative fuels, which he called "a much longer undertaking, but in the long run, the right thing to pursue."Īs it tries to save fuel, Southwest also is expanding its routes. "All of the tools are there, they simply need to be implemented, 's all within our grasp," he says. And it has changed pilots' flying habits to get higher efficiency.Ī proposed modernization of the air-traffic-control system, which the airlines back but hasn't yet found funding, could reduce the industry's fuel usage by 15% more, Kelly says. It also uses blended winglets - devices that attach to wingtips to reduce drag, thereby reducing fuel consumption - and electric, instead of fuel-burning, ground equipment. carrier, also has cut its fuel expenses by retiring less efficient aircraft. Southwest, which flies more passengers than any other U.S. Southwest hedges its fuel purchases: Kelly says the carrier has contracts to buy about half of its fuel through 2014 at prices "roughly equivalent to the current market, somewhere around $90 per barrel." In the past decade, similar hedging activity has saved Southwest $4 billion, equivalent to the cost of 125 airplanes, Kelly adds. "It is very, very difficult to respond in the short term to a fuel-price spike." They have "the potential to change rapidly and to very rapidly destroy profitability," Kelly (pictured) says. Representing one-third of Southwest's total expenses, fuel costs are a major factor for the consistently profitable low-cost carrier. During a trip to New York this week, where he met with aviation executives and airline analysts, the chief executive of Southwest Airlines ( LUV) called jet-fuel costs his greatest concern for next year. The price of jet fuel is high on Gary Kelly's mind. Isom is heir apparent to American Chief Executive Doug Parker.Southwest Airlines's CEO Gary Kelly says jet-fuel prices top his list of concerns for 2011. Kirby landed at United from American Airlines (AAL.O) in 2016 after the board passed over him as a potential leader.įollowing Kirby's departure, American elevated Robert Isom, then chief operating officer, to the role of president. Rival United Airlines (UAL.O) last year named insider Scott Kirby to succeed Oscar Munoz to the top job. This is the latest transition at the top at a major U.S. "We’ll continue to stabilize the company coming out of this pandemic and be ready for what I hope will be a really strong 2022 with a lot of momentum," he said. Southwest did not consider any external candidates for the job, Kelly said. "There’s a lot to step into," Jordan said, adding that his first areas of focus will be ensuring a stable transition and getting out with team members. The stock has more than tripled in value during Kelly's tenure.
Southwest's shares were down 0.8% at $55.32 in early afternoon. REUTERS/Lucy Nicholsonĭuring the pandemic, he played a key role in reducing the airline's labor costs and avoiding layoffs and furloughs, the company said. A Southwest Airlines Boeing 737-800 plane is seen at Los Angeles International Airport (LAX) in the Greater Los Angeles Area, California, U.S., April 10, 2017.
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