Southwest to remove 717s by beginning of 2015

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Southwest Airlines plans to remove the last of its Boeing 717-200s by the first quarter of 2015, says chairman and chief executive Gary Kelly.

The move will allow the Dallas-based low-fare carrier to optimise its operations following its 2010 acquisition of AirTran Airways, he said at the monthly Wings Club luncheon in New York on 12 December.

It is also well ahead of Southwest’s end-of-2015 deadline to transition the 717s to Delta Air Lines.

Atlanta-based Delta is scheduled to take 717s from Southwest at a rate of three per month with the last aircraft arriving at the end of 2015, under a lease agreement for the 88 aircraft that the airlines reached in May 2012.

“We will continue to that the aircraft as originally scheduled,” says Delta. This includes 36 aircraft in both 2014 and 2015.

The 717s will “ remain inactive” when they are removed from service until they transition to Delta, says Southwest. The cost of parking the aircraft is included in the $550 million anticipated AirTran integration and acquisition expenses, it adds.

The carrier will replace the exiting aircraft with deliveries of seven Boeing 737-700 and 33 737-800 aircraft in 2014. It has an additional five -700 and 19 -800 deliveries scheduled in 2015.

Southwest will be able to realise many of the operational benefits of its merger with AirTran once the 717s are out of its fleet. The aircraft, as well as its inability to operate international flights, have kept Southwest from completing the integration.

“Those two things, the 717 retirement and the launch of the international, will facilitate the final conversion of AirTran to Southwest,” says Kelly. “Each one of those are important and will put us in a position to optimise our network and our schedule.”

Southwest’s international plans will be announced in January 2014, he says.

International operations are likely to include existing AirTran routes to the Caribbean and Mexico as well as new flights from gateways at Fort Lauderdale-Hollywood International and Houston Hobby airports, where new international arrivals facilities for Southwest are either planned or under construction.

Kelly called the ongoing integration an “earnings drag” during Southwest’s third quarter earnings call in October. The airline reported an operating profit of $390 million on $4.55 billion in operating revenue and $4.16 billion in operating expenses during the quarter.

Southwest has hired Amadeus to implement its Altea reservations system in 2014. This will allow it to operate international flights.