Southwest CEO remains adamantly opposed to baggage fees

[SpauldingSmails]

So he wont increase obvious revenue but instead takes it out on labor.

Mergers, flying International..push for pay cuts.....yep you luv Warriors are in our legacy airline world now! Good Luck.

"We take the costs out of our employee's paychecks and pass the savings along to you, the customers."

Sounds like a legacy to me.

 

[Kharma Police]

Herb never lived in his Mom's basement. Did he?

Well he never would have put up with with this stuff!

I was referring to Piggy aka, "The AirTran Village Idiot", not Herb or Gary. If you have to ask who I'm talking about then you probably don't need (or care) to know.

 

[Luv2BFlyin]

Herb never lived in his Mom's basement. Did he?

Well he never would have put up with with this stuff!

And you'd probably still have round dials on your DU's.

What would wouldn't he put up with?

 

[SWA Bubba]

I used to think this guy was pretty smart. Not so much anymore. He's just the typical dooshy airline manager who would be kicked out of any significant management position in another industry.

I beg to differ.

He would most definitely NOT be kicked out of any other industry's "significant management position," controlled by a board of directors and stockholders. They (the board) would love to have GK or someone like him. In a little more than a year, he has more than quadrupled the company's stock price, and not only has he always made a yearly profit, even in the leanest years of the recession, but he has recently overseen multiple consecutive quarters with record profits. That's what stockholders and board members care about. They don't generally give a rat's a$$ about alienating customers and employees, as long as you consistently make money. And by God, he does.

Now his employees, on the other hand, may have a different opinion. If you had said that, I might have agreed with you.

Bubba

 

[waveflyer]

We need a new CEO!!!

We do?

Please elaborate

 

[waveflyer]

No bag fees and record profits. hmmmmm

This^^^

 

[jackjack]

When polled, overwhelmingly the pilots said job security was #1!

 

[HowardBorden]

No bag fees and record profits. hmmmmm

Absolutely!

The legacy carriers used bankruptcy to attempt to level the cost playing field and yet most still lag behind in CASM.

Although most in the industry are realizing record profits, much of that profit comes from hugely increased ancillary fees contributing greatly to the bottom line. SWA has done so without tapping the fee spigot.

I will admit I have been skeptical on the baggage fee issue now that it has become a regularly accepted cost that will clearly never go away, however the numbers don't lie and he is showing record profits without the fees everyone else is using.

In the end I see bag fees as a "get out of jail free" card. If and when financial hard times hit at SWA, they have an accepted revenue stream to tap in order to weather the storm. Rest assured if a financial storm hits, it will effect all carriers in similar ways and most don't have a back up plan to roll out if needed.

 

[PCL_128]

It doesn't matter if you're beating your own records when everyone else is blowing you out of the water. Richard Anderson looks at SWA's "record profits" and giggles.

 

[HowardBorden]

It doesn't matter if you're beating your own records when everyone else is blowing you out of the water. Richard Anderson looks at SWA's "record profits" and giggles.

I couldn't care less what Richard Anderson giggles at.

My point is that most of the legacies have given "everything" they have to maximize profitability, the bankruptcy courts slashed their cost structure and ancillary fees have padded the bottom line to reach the current profit margins. Southwest is making record profits without using these methods. When hard times hit (and they will) SWA has a lot of flexibility left in their playbook to remain profitable in a down market.

 

[PCL_128]

The mantra about the legacies abusing bankruptcy to right-size costs is complete BS. The legacies were around for half a century before SWA first showed up, and they had regulation-era cost structures to fix that SWA never had to deal with. Bankruptcy was a necessity for them, and the fact that you avoided it is not surprising since you weren't saddled with what they were from the days of regulation. Now they've handled that, and SWA no longer has an advantage. Sure, you're sitting on a pile of cash, but that's just because Gary is too incompetent to know what to do with it.

 

[General Lee]

The mantra about the legacies abusing bankruptcy to right-size costs is complete BS. The legacies were around for half a century before SWA first showed up, and they had regulation-era cost structures to fix that SWA never had to deal with. Bankruptcy was a necessity for them, and the fact that you avoided it is not surprising since you weren't saddled with what they were from the days of regulation. Now they've handled that, and SWA no longer has an advantage. Sure, you're sitting on a pile of cash, but that's just because Gary is too incompetent to know what to do with it.

Well stated. Howie will change his tune when his boss starts asking for givebacks. And he's used bag fees at AT since the merger to help pay for it, something the Corndogs seem to forget conveniently....


Bye Bye---General Lee

 

[freightdogfred]

The proof in the pudding is 1st quarter results 2015. No more Airtran, bag fees, inefficient 717's, what have you. We shall see. .

 

[waveflyer]

It doesn't matter if you're beating your own records when everyone else is blowing you out of the water. Richard Anderson looks at SWA's "record profits" and giggles.

Go work for him then.
You haven't figured out that SWA cycles less than the legacies?
You really have a very young view of the industry.
The cocksure just makes you that much more do^chy

 

[PCL_128]

No, wave, you just haven't figured out that your past is not a reliable indicator of your future. You'll learn soon enough, though.