Southwest CEO: We May Not Be an All-737 Carrier 'Into Perpetuity'
Southwest Airlines has long been synonymous with the Boeing 737, but could that be set for a change?
It may remain a long shot, but Southwest CEO Gary Kelly at least left the door open to that possibility in the wake of the grounding of Boeing’s 737 MAX variant.
"We're an all-Boeing 737 carrier," Kelly said in a Thursday interview with CNBC. "That doesn't mean that we’ll be an all-737 carrier into perpetuity."
Kelly’s comments come against the backdrop of the airline’s quarterly earnings report, in which Southwest said it has been forced to cancel more than 10,000 flights since the MAX variant of the 737 was grounded in March. Southwest has 34 737 MAX jets in its fleet of about 750 total aircraft; all are versions of the 737.
Southwest’s fleet has been comprised almost exclusively of Boeing 737 jets ever since the low-cost carrier launched in 1971. There were briefly some 727s in the company’s fleet in the 1970s and 1980s while Southwest inherited an AirTran fleet that included Boeing 717s when that carrier was acquired in 2010. Southwest subsequently sold those 717s to Delta Air Lines. Kelly’s comments also come after a report in Jon Ostrower’s The Air Current industry website said Southwest representatives “visited an Airbus A220 operator in Europe, kicking the tires on the aircraft” and learning more about the operator’s experience with the single-aisle jet.
Ostrower’s report, which cited an unnamed “person familiar with the trip,” ran under a headline reading “737 Max grounding tests Southwest’s relationship with Boeing.”
Still, it’s not clear how much reading between the lines there is to be done on Kelly’s "perpetuity" statement.
While he told CNBC that “we’re not happy about this MAX situation,” he did follow with praise for 737 MAX.
“When we launched (the) MAX airplane, we felt like it was the best single-aisle airplane in the world, and we still feel that way,” he said to CNBC.
Further, Reuters notes “It is not the first time Southwest has hinted about fleet changes, which could benefit Boeing's European rival Airbus, but such a decision would mean abandoning Southwest's long-held practice of flying only one type of jet, which reduces maintenance and pilot training costs.”
Reuters talked to an unnamed “source familiar with Southwest's thinking” who said Boeing could instead consider a different Boeing model. "It makes more sense to ease into any transition with the same manufacturer," the source said to Reuters, though it’s not clear what other Boeing model might be a good fit for Southwest.
Aside from the 737, the only other commercial airplanes currently in production by Boeing are widebody aircraft typically used on overseas flights.
Elsewhere in Southwest’s earnings report, the carrier said Hawaii would be Southwest’s primary focus for expansion through 2020.
After years of anticipation, Southwest began flying to Hawaii just last month, launching the first of several routes to California.
More is coming, Kelly said.
“Our interisland service is scheduled to begin on April 28th, with service between Honolulu and Maui, and between Honolulu and Kona on the island of Hawaii on May 12th,” Kelly said in a statement accompanying Southwest’s earnings. “More service is planned for the previously announced gateways of San Diego and Sacramento, and for Lihue on Kauai. We are very pleased with our Hawaii performance, thus far, and expect Hawaii to be the key expansion focus in 2019 and 2020."