Another US investment firm with a stake in Southwest Airlines is calling for wholesale changes to the carrier’s leadership team and strategic direction. 

Hedge fund Elliott Investment Management, which owns an 11% share of Southwest’s outstanding stock, recently wrote a searing letter to the company’s board of directors, arguing that a leadership overhaul is overdue and that the C-suite – and board – should add more executives with outside airline experience. 

Milwaukee-based Artisan Partners followed up with a letter of its own on 12 June. The global asset manager holds nearly 11 million – or about 1.8% – of Southwest’s shares. 

”We note with great interest the recent announcement by Elliott Investment Management regarding their position in the company, their assessment of the company’s current management team and their call for dramatic change at Southwest, including new leadership,” the firm says. 

“We have made many of the same points to the company’s executive chairman over the past several months.”

Southwest Airlines Boeing 737

Source: Southwest Airlines

Southwest Airlines has been defending its leadership team and strategic direction from the pointed critiques of a pair of US investment firms 

Without naming them specifically, Artisan Partners seems to express dissatisfaction with executive chairman Gary Kelly and chief executive Bob Jordan. The letter urges Southwest’s board to ”reconstitute itself and upgrade the company’s leadership”, adding that it believes “this process needs to commence immediately”. 

The Dallas Morning News reports that Jordan is not planning to resign despite the pressure from the investment firms, and is planning to follow a new strategic plan. 

Southwest has pushed back against criticism that it is too slow to adapt to the modern airline industry. Elliott said in its 10 June letter that the carrier’s current position is defined by “a rigid commitment to an approach developed decades ago”. 

”We are confident that Southwest Airlines has the right strategy, the right plan and the right team in place to drive long-term value for our shareholders,” Southwest said in response. 

Southwest had been exploring major changes – such as potentially abandoning its single-class cabin – prior to investors urging the airline to take a bold new direction. It promises to reveal more of its long-term strategic plan in September.