SWA pulling out of four cities

I'm fortunate to work with three former WN network planners, and we had a lively discussion this morning about the carrier and its NP strategy.
 
Roger Roger said:
Welcome to modern capitalism, the long term doesn’t matter, make big decisions based on one quarter’s performance. Gotta crank that shareholder value!
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Are you Sirius? :)


Southwest and Alaska have historically done well and route plan what they think is best. Two investment grade airlines. When Covid started, there was a chart by (WSJ I think) that showed how long each carrier could survive in a zero cash environment. AA was about 5 days. Delta was about 12 months. Southwest and Alaska were the longest bars in that chart, at 15 months.

Did you see the Q1 losses? I do that think rah rah capitalism is the answer here.
 
JordanD said:
Alright, I gotta kinda throw the BS flag on this one. An airline exists to make money, it makes no sense for them to keep flying a route that isn't doing that for them.
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Yeah, respectfully, @Roger Roger, I gotta agree with Jordan on this one. Airlines need to fly routes that make money. We aren't the only ones re-shuffling the deck on routes.

You would think BUF was Mecca given how much flying we're doing there in May.
 
JordanD said:
Alright, I gotta kinda throw the BS flag on this one. An airline exists to make money, it makes no sense for them to keep flying a route that isn't doing that for them.
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Yep, can''t expect them to keep flying unprofitable (or at least less profitable- the article implies the cuts are mostly due to delayed aircraft deliveries) routes. Not unless you're going to subsidize those routes or resurrect airline regulation. And after all the bailouts airlines received during the Pandemic, at this point I wonder if some form of airline re-regulation might actually be a good idea.
 
It just seems like an overreaction to losing money in one quarter, the same quarter that is often a money losing one for airlines, historically. But hey, we fly to Bellingham and IAH never really made sense for SWA anyway.
 
One of the most powerful tools that airlines have at their disposal is that their most valuable capital assets are mobile. If you realize your brand power just isn't carrying you or there just isn't a market somewhere you can just put the planes somewhere else. Can't do that with a factory.

You explore every city pair that you have a hunch might work knowing some won't.
 
Haven't they already blamed Boeing for this due to a bunch of unexpected new plane deliveries?
 
The MAX delivery issue arguably hits SWA the worst. They had -7s on order and who the hell knows when they get those. AS took delivery of a -9 a few days ago and we get 5 more MAXs by the end of May. How many are SWA getting this year now? I would imagine they were heavily relying on deliveries for their fall schedule. Sucks to see this happen :(
 
Boeing is already teetering on collapse, maybe Southwest should consider Airbus? Nope, they don't have any new airplanes immediately available either. What I don't understand is these airplanes are built to work almost 24/7/365 for a very long time, if they've been operating these routes with fairly modern airplanes why just drop routes, close stations and lay off 2000 people because they aren't getting their brand new jets? When was the last time they operated a 737-200? I know absolutely nothing about airline economics. I have a list of domestic airlines I won't fly on, Southwest is not on that list.
 
Constellation said:
Didn't even know SWA touched IAH - always assumed HOU was their only Houston presence.
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That was a weird gain a few years or so back? I was wondering when they’d enter DFW, instead of just DAL, when they did the IAH gain.
 
knot4u said:
Boeing is already teetering on collapse, maybe Southwest should consider Airbus? Nope, they don't have any new airplanes immediately available either. What I don't understand is these airplanes are built to work almost 24/7/365 for a very long time, if they've been operating these routes with fairly modern airplanes why just drop routes, close stations and lay off 2000 people because they aren't getting their brand new jets? When was the last time they operated a 737-200? I know absolutely nothing about airline economics. I have a list of domestic airlines I won't fly on, Southwest is not on that list.
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Boeing teetering on collapse? That’s a bit much.

Great buying opportunity right now :)
 
Cherokee_Cruiser said:
Boeing teetering on collapse? That’s a bit much.

Great buying opportunity right now :)
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There's no guarantees in stocks. You have some so you are what I'd call a forced optimist, I'm not saying you're not a savvy investor. I'm just saying the company is in real trouble right now, senior management folks might be facing criminal charges. I'll happily get on a 737 (even a -8 MAX or whatever it is) without a second thought. But the truth is they seem to have gotten less engineer driven and more board room driven over the last few decades and it's showing. Your stock might be worthless sooner than you think.
 
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