Southwest’s plan to keep fleet static caps new market growth

Washington DC
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Southwest Airlines is to keep its fleet growth static until the end of 2011, limiting its ability to add a significant amount of new markets to its network in the near term.

Southwest is crafting its route expansion through optimising its flight schedule rather than fleet growth, says chief executive Gary Kelly. The carrier has no plans to expand its fleet for at least 18 months, perhaps longer. "Although it is too early to commit, at present, we have no plans to grow the fleet in 2012," he says.

Although the carrier has exercised 25 737-700 options for delivery from 2011 through to 2016, it intends to keep its fleet count flat by shedding more of its Boeing 737 Classics than previously planned. Southwest has also increased its purchase rights until 2021 to 98 versus a previous total of 54 through 2018. Flightglobal's ACAS database shows that Southwest operates 543 737s, a mix of Classics and Next Generation aircraft.

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 © Southwest Airlines

Kelly explains that next year, "I don't think we can add anymore new cities other than the two in South Carolina". Earlier this year Southwest unveiled plans to introduce flights from Greenville-Spartanburg and Charleston, South Carolina in 2011.

Kelly says he would like Southwest to add a couple of new cities in 2012, "and we certainly have a long list that we're contemplating and we are working a lot of those opportunities".

The Dallas-based airline posted net income of $216 million for the second quarter of 2010, up from $59 million for the previous year. Operating revenues rose 21% to $3.2 billion as expenses grew 12.5% to $2.8 billion, while operating income rose 195% to $363 million.