Southwest Airlines Reports Loss

[contrail67]

With the price of oil where it is....it is a level playing field now. The squeeze is about to begin.

 

[YourPilotFriend]

With the price of oil where it is....it is a level playing field now. The squeeze is about to begin.

The price of oil means nothing when credit companies won't fund vacations......

 

[contrail67]

"An up and coming airline can't have industry leading wages."

Maybe not...but they can have Industry Standard wages.

Funny, but start-ups manage to pay Industry Standard rates for airframes, insurance, parts, spares, gates, infrastructure, taxes, fees etc.

Yes, they negotiate breaks here and there and receive some incentives now and again...But Pilots are the ONLY ones who will fall for the ridiculous argument that 50% or less is what is necessary to accept as a wage to "help" the airline get started or, in the case of harsh economic times, to survive.

YKMKR

Don't forget...having to pay/get your 737 type to get hired too.

 

[PulluP]

Southwest Airlines Cuts Capacity, Reports Fuel Hedges Lost $2 Billion in Value

After reporting its first loss in 17 years last week, Southwest announced it is cutting capacity 5% to 6% in early 2009. The ongoing economic crises and volatility in oil prices are creating “an environment where it makes no sense to be growing,” said Southwest CEO Gary Kelly.

In a quarterly filing to the Securities and Exchange Commission on Monday, Southwest also reported its fuel hedging contracts have lost $2 billion in value, falling from $2.5 billion on Sept. 30 to $550 million as of Oct. 15.

 

[GuppyWN]

Don't get me wrong, the other airlines are in way worse shape. However, I don't see how SW will be able to cut costs without selling off a major portion of the airline, or going into bankruptcy. This is reality, demand for air travel is going down. Ticket sales into next year are already down 50% in some sectors.

Dude. Do you even know what you're talking about or are you guessing?

Our unit revenue is UP 11% over last year. Our CASM vs. our peers is much lower. We have over 6 BILLION in the bank.

2009 bankruptsy huh? Okie Dokie.

Gup

 

[contrail67]

Southwest Airlines Cuts Capacity, Reports Fuel Hedges Lost $2 Billion in Value

After reporting its first loss in 17 years last week, Southwest announced it is cutting capacity 5% to 6% in early 2009. The ongoing economic crises and volatility in oil prices are creating “an environment where it makes no sense to be growing,” said Southwest CEO Gary Kelly.

In a quarterly filing to the Securities and Exchange Commission on Monday, Southwest also reported its fuel hedging contracts have lost $2 billion in value, falling from $2.5 billion on Sept. 30 to $550 million as
of Oct. 15.

Sound of chirping crickets.....

 

[GuppyWN]

Chirping crickets? The 6% reduction was announced 3 months ago - when fuel was $150 a barrell. Let's wait till January and see what happens.

...... and about the hedges. Mr. Kelly was the first one to say that lower fuel prices help us much more than they hurt us. We are quick and nimble. And we have orders on the books.

Gup

 

[contrail67]

Dude. Do you even know what you're talking about or are you guessing?

Our unit revenue is UP 11% over last year. Our CASM vs. our peers is much lower. We have over 6 BILLION in the bank.

2009 bankruptsy huh? Okie Dokie.

Gup

The airline's revenue rose about 12 percent to $2.9 billion. The company ended the quarter with $3.4 billion in cash and short term investments.........over 6 Billion? Not what this article says. Who is right?

 

[contrail67]

Chirping crickets? The 6% reduction was announced 3 months ago - when fuel was $150 a barrell. Let's wait till January and see what happens.

...... and about the hedges. Mr. Kelly was the first one to say that lower fuel prices help us much more than they hurt us. We are quick and nimble. And we have orders on the books.

Gup

But airlines are worried that they are merely trading one big problem for another, as global financial markets sag and indicators point to recession in the U.S.
"The main thing now is the recession and the impact on travel demand," said Southwest CEO Gary Kelly. "We haven't seen any impact yet. My biggest concern now is January

Even Gary is not looking forward to Jan.

 

[Dude]

It is funny when people talk about a level/fair playing field. It's like you challenged a 300 lb. lineman to an a$$kicking contest and after your pounding you protested the contest wasn't fair because the lineman was stronger than you.

Southwest has been a leader in minimizing costs and controlling its balance sheet so that it can, if an opportunity arises, take advantage of opportunities like a hedging program. It's no different than AA or any other legacy partnering with credit card companies for mileage and loyalty programs. We just capitalized on our financial health. Sorry if that upsets you.